Blockchain Beyond Cryptocurrency

TABLE OF CONTENTS

1. INTRODUCTION
2. DEFINITION OF BLOCKCHAIN
3. TYPES OF BLOCKCHAIN
   1. PUBLIC BLOCKCHAIN
   2. PRIVATE BLOCKCHAIN
   3. HYBRID BLOCKCHAIN
   4. CONSORTIUM BLOCKCHAIN
4. BLOCKCHAIN BEYOND CRYPTOCURRENCY
   1. SUPPLY CHAIN MANAGEMENT
   2. VOTING SYSTEMS
   3. INTELLECTUAL PROPERTY
   4. HEALTHCARE
   5. FINANCE AND BANKING
   6. GOVERNMENT AND PUBLIC RECORDS
   7. REAL ESTATE
   8. ENERGY SECTOR
5. CURRENT TRENDS
6. CONCLUSION
7. REFERENCES

Introduction

Imagine a record book, not owned by a single person, but shared among everyone who uses it. This record book is constantly being updated, and everyone can create updates, see and verify the changes made.
This is the basic idea of blockchain, a super secure powerful technology that no one can cheat and oh, that goes beyond cryptocurrencies! It is like the engine that powers a car; cryptocurrencies are just one kind of car that uses the engine.

Definition of blockchain technology

A blockchain is essentially a distributed database of records or a public ledger of all transactions or digital events that have been executed and shared among participating parties. Each transaction in the public ledger is verified by consensus of a majority of the participants in the system. And, once entered, information can never be erased. The blockchain contains a certain and verifiable record of every single transaction ever made.
Here's how it works:

• Shared Record Book: Instead of a single person or company controlling the record, everyone using the system has a copy. This makes it very hard to cheat or change information.
• Verified Transactions: Think of each entry in the record book as a transaction verified by the majority of people using the system, like a digital vote of approval.
• Unchangeable History: Once a transaction is added and verified, it's like permanent ink - it can't be erased or altered. This creates a clear and reliable history of everything that's ever happened.

Types of blockchain technology

• There are various types of blockchain technology which includes the following:

1. Public blockchain

• A public blockchain is a decentralized network that is freely accessible to anyone is not controlled by any single entity.
• Due to its non-restrictive and permission-less state, anyone with internet access can sign on to a blockchain platform to become an authorized node. Users can access current and past records, conduct mining activities, the complex computations used to verify transactions and add them to the ledger. No valid record or transaction can be changed on the network, and anyone can verify the transactions, find bugs or propose changes because the source code is usually open source.
• Examples include the Bitcoin and Ethereum blockchains.

Advantages

• Independence- they are completely independent of organizations, so if the organization that started it ceases to exist the public blockchain will still be able to run, as long as there are computers still connected to it
• Transparency- As long as the users follow security protocols and methods fastidiously, public blockchains are mostly secure.

Disadvantages

• Public blockchains can get sluggish as more users join, leading to slower transactions and potentially higher fees.
• Security risks include vulnerabilities to hacking and the theoretical possibility of a powerful attacker manipulating the network.

Use Cases

• Cryptocurrency
• Document Validation

2. Private Blockchain

• A blockchain network that works in a restrictive environment like a closed network, or that is under the control of a single entity, is a private blockchain. While it operates like a public blockchain network in the sense that it uses peer-to-peer connections and decentralization, this type of blockchain is on a much smaller scale. Instead of just anyone being able to join and provide computing power, private blockchains typically are operated on a small network inside a company or organization. They're also known as permissioned blockchains or enterprise blockchains.

Advantages:

• Access Control: Organizations can set permission levels, security protocols, and who can access or modify data. This allows for controlled sharing of sensitive information.
• Performance: Private blockchains typically offer faster transaction speeds and scalability compared to public blockchains.

Disadvantages:

• Centralization: Some argue private blockchains aren't "true" blockchains due to their centralized nature. A single entity controls the network, which goes against the core idea of decentralization in public blockchains.
• Trust: Since a central authority validates transactions, achieving complete trust in the information can be challenging.
• Limited Auditability: Private blockchains often use closed-source code, making it difficult for users to independently verify its security.

Use Cases

• Supply chain management, asset ownership and internal voting.
• Asset Ownership

3. Hybrid Blockchain

• It is a type of blockchain technology that integrates elements of both private and public blockchains. It enables organizations to establish a private, permission-based system alongside a public, permissionless system, giving them control over who can access specific data on the blockchain and what data will be publicly available.
• In a hybrid blockchain, transactions and records are typically not public but can be verified when necessary, for instance, by granting access through a smart contract. Confidential information remains within the network but is still verifiable. Although a private entity may own the hybrid blockchain, it cannot modify the transactions.

Advantages

• Access Control
• Performance
• Scalability

Disadvantages

• Transparency- This type of blockchain isn't completely transparent because information can be shielded.
• Upgrading- Upgrading can also be a challenge, and there is no incentive for users to participate or contribute to the network.

Use Cases

• Medical Records- The record can't be viewed by random third parties, but users can access their information through a smart contract.
• Real Estate
• Governments could also use it to store citizen data privately but share the information securely between institutions.

4. Consortium blockchain

• The fourth type of blockchain, consortium blockchain, also known as a federated blockchain, is similar to a hybrid blockchain in that it has private and public blockchain features. But it's different in that multiple organizational members collaborate on a decentralized network. Essentially, a consortium blockchain is a private blockchain with limited access to a particular group, eliminating the risks that come with just one entity controlling the network on a private blockchain.
• In a consortium blockchain, the consensus procedures are controlled by preset nodes. It has a validator node that initiates, receives and validates transactions. Member nodes can receive or initiate transactions.

Advantages

• Access Control
• Scalability
• Security

Disadvantages

• Transparency- Consortium blockchain is less transparent than public blockchain. It can still be compromised if a member node is breached, the blockchain's own regulations can impair the network's functionality.

Use Cases

• Banking- Banking and payments are two uses for this type of blockchain. Different banks can band together and form a consortium, deciding which nodes will validate the transactions.
• Research -Research organizations can create a similar model, as can organizations that want to track food.
• Supply chain- It's ideal for supply chains, particularly food and medicine applications

BLOCKCHAIN BEYOND CRYPTOCURRENCY

Cryptocurrency gets a lot of attention, but blockchain is much bigger. Here's what blockchain can do:

1. Supply Chain Management
Blockchain can revolutionize supply chain management by providing a transparent and immutable record of the journey of goods from origin to consumer. This transparency helps in:

• Reducing Fraud: Each step of the supply chain is recorded, making it difficult for fraudulent activities to go unnoticed.
• Improving Efficiency: Automated processes can reduce delays and errors, enhancing overall efficiency.
• Ensuring Authenticity: Consumers can verify the authenticity and origin of products, especially important in industries like pharmaceuticals and luxury goods.

2. Voting Systems:

• Ensures accurate voting that can easily be checked by the general public by avoiding cases where the computer system can be altered. Such tasks include: a) Registration of voters b) Electronic voting whereby people use the digital ballot to cast their vote. c) The orator will cast a vote for a candidate after encrypting the said vote and this vote is recorded on the blockchain system.
• The identity of each voter does not reveal, which assures maximum anonymity of voters. Rather than storing the raw values of the National ID numbers or the voting card numbers in the blocks, it is more secure to do a hash of these numbers through a hash function such as SHA 256. This makes it possible for each voter to develop a singular and unchangeable identity as a unique voter and each vote is a separate transaction on the blockchain, for;
• Recording
• Storage
• Verification
• Counting results

3. Intellectual Property:

• Creating and safeguarding a system of IPR to enable creators to register their work effectively for public use and monitor the extent of usage. This includes a number of processes which are: This includes a number of processes which are:

a) Intellectual property rights – today, people have registered their web addresses where they leave electronic footprints.

b) Ownership documents: data that can still be accessed but cannot be altered or deleted within the record and also a public identification which allows users to confirm the existence and ownership of properties.
c) Smart contracts for licenses and royalties- if artists and other content creators depending on their work being used to generate royalty payments then the smart contracts for license can provide solutions by automating the licensing process, hence removing the need for middlemen of payment and thus paying creators instantly when their works have been used.
d) Reducing counterfeiting- through record keeping on the blockchain, any counterfeit that has been produced will be easily discerned for it will be an unlawful infringing of record ownership and licensing terms.

4. Healthcare
The focal areas of the heath care industry where blockchain can respond to problems include data protection and the privacy of individuals. Key benefits include:

• Secure Medical Records: It is apparent that the use of blockchain technology is innovative because it can provide the storage of patient records with the added feature of being exclusive to those with appropriate permissions.
• Interoperability: It means that different providers of health care services will be able to exchange information or data about the patient for better care planning.
• Clinical Trials: Certain clinical applications of Block chain are that it helps in avoiding issues related to the integrity and trust of records of clinical trials.

5. Finance and Banking

• Efficiency in inter-bank operations, decrease of frauds and optimization of operations in an organized secure B2B network involving a trusted group of banks. Banks utilize blockchain technology in several ways: Banks utilize blockchain technology in several ways:

i) Trade Finance: Helping the businesses to minimize their risks through insurance and making other promises via making advance payments.

ii) KYC and AML: As for AML (Anti-Money Laundering), it can be explained as a procedure for stopping money laundering criminals from becoming clients and detecting and reporting the doubtful transactions. From KYC stands for (Know Your Customer), it is a procedure that entails identifying the customer, conducting screening, and assessing the risks the customer poses to the business.

iii) Regulatory Compliance: This includes compliance with legal requirements and statutes, rules, policies, and procedures governing the organization’s operations. Penalties for non-compliance include federal fines, legal consequences, contract ramifications, and fines and penalties for departments within the institutions.

iv)Syndicated Lending: A single credit deal by a large number of lenders, which consolidate the funds to provide a borrower.

v) Payment Settlement: It involves the payment made by the issuing bank directly to the acquiring bank through the use of a payment gateway deducted from the total amount of funds in the cardholder’s account.

The benefits of blockchain in finance are as follows: The benefits of blockchain in finance are as follows:

- Enhanced security: Since the platform that underlies blockchain technology is very secure, it gives it a very low level of probability to be fraudulent and has a very low propensity to have errors.
- Transparency and traceability: Whenever two persons make a transaction, it becomes recorded in the blockchain, thus making the auditing of the transaction or monitoring of the trust between two persons easily done.
- Improved Efficiency: Firms should adopt the strategy of reducing or even eliminating the middlemen and automate many processes since it is possible to increase efficiency in many sectors including trade finances.
- Faster and cheaper blockchains: Due to the decentralized nature of the blockchain, it has the ability to augment the overall process of cross-boarder payment with less time required to complete the transaction than what would take with other systems and also entails lower charges than what is incumbent on other systems.

6. Government and Public Records
Blockchain technology offers significant advantages for managing sensitive public records, such as land titles and personal identification. Here’s a brief explanation:

• Enhanced Security: Blockchain’s decentralized nature and cryptographic security ensure that public records are tamper-proof and secure from unauthorized access or alterations.
• Improved Transparency: Every transaction or update on the blockchain is recorded and visible to all authorized parties, providing a transparent and immutable history of changes.
• Efficient Management: Blockchain can streamline the process of managing public records by reducing the need for intermediaries, speeding up processes, and reducing administrative costs.
• Privacy and Control: Individuals can have greater control over their personal data. Blockchain allows for secure sharing of personal information, ensuring that only authorized entities can access sensitive records.
• Reduced Fraud and Errors: The immutable nature of blockchain records minimizes the risk of fraud and errors, ensuring the integrity of public records.

7. Real Estate:
The real estate industry benefits from blockchain through increased transparency in property transactions, reducing fraud, and decreasing the time and costs associated with the property transfers.

• Tokenization of real estate assets (converting real estate properties to into digital tokens) has increased liquidity, streamlined processes and enabled digital ownership.
• Streamlining property transactions and maintaining records among a group of real estate firms, financial institutions, and government bodies.
• Access to global asset distribution-tokenization of real-estate assets can make it easier for investors to access global real estate markets.
• Data accessibility which has led to increased transparency and informed better investment decisions and portfolio management.

8. Energy Sector

• Blockchain technology is poised to revolutionize the energy sector by enabling innovative business models and enhancing efficiency. Here’s a brief explanation of its applications:
• Energy Tokens: Blockchain-based tokens can represent units of energy, facilitating new business models like energy crowdfunding and community-owned renewable energy projects.
• Energy Crowdfunding: Individuals can invest in renewable energy projects by purchasing energy tokens, providing the necessary capital for projects to get off the ground and promoting sustainable energy development.
• Community-Owned Projects: Blockchain enables communities to collectively own and manage renewable energy resources, such as solar panels or wind turbines. Profits and energy savings can be distributed fairly among token holders.
• Decentralized Energy Trading: Tokens can be traded on blockchain platforms, allowing individuals and businesses to buy and sell energy directly without intermediaries. This can lead to more competitive pricing and better utilization of energy resources.
• Energy Storage: Tokens can be stored in digital wallets, allowing users to accumulate energy credits for future use or sale. This promotes energy conservation and provides flexibility in energy consumption.

Current Trends

blockchain technology continues to evolve rapidly, and some current trends include
1. DeFi (Decentralized Finance):
DeFi platforms leverage blockchain to provide decentralized lending, borrowing, and trading services.
2. NTFs (Non-Fungible Tokens):
NFTs, representing ownership of unique digital assets, have gained popularity in the art, gaming, and entertainment industries.
3. Baas (Blockchain as a service):
cloud providers offer Baas solutions, making it easier for businesses to implement blockchain without significant infrastructure investments.

Challenges facing blockchain technology

While blockchain offers significant advantages, it also faces several challenges:
1. Scalability
Blockchain networks like Bitcoin and Ethereum have struggled with scalability issues, leading to slow transaction processing and high fees.
2. Regulatory concerns:
Governments and regulatory bodies are still developing guidelines for blockchain technology, leading to uncertainty in some sectors.
3. Energy Consumption:
Proof-of-work blockchains consume a considerable amount of energy, leading to environmental concerns.
4. Interoperability: Blockchain networks often operate in silos, making it difficult for them to communicate and interact with each other seamlessly. Interoperability standards and protocols are needed to enable cross-chain communication and data exchange, fostering a more interconnected blockchain ecosystem.
5. Technical integration: User Experience and Accessibility. Blockchain applications and wallets can be complex and intimidating for non-technical users, hindering mainstream adoption. Improving the user experience, designing intuitive interfaces, and providing educational resources are crucial for making blockchain technology more accessible to a wider audience
6. Security Concerns: While blockchain technology offers inherent security features such as cryptographic encryption and immutability, it is not immune to security breaches and vulnerabilities. Smart contract bugs, consensus algorithm flaws, and centralized points of failure pose risks to blockchain networks and the assets stored on them. Ongoing security audits, rigorous testing, and best practices for secure development are essential to mitigate these risks.

Conclusion

Blockchain technology has transcended its original purpose as the backbone of cryptocurrencies to become a transformative force across industries. It has potential to improve transparency, security, and efficiency, and continues to drive innovation and investment. Although challenges remain, ongoing development and adoption trends suggest that blockchain is here to stay and will play a key role in shaping the future of many sectors beyond cryptocurrencies

References

1. Pradeep Vaibhav Anasune, Madhura Choudhari, Pranali Shirke Prasad Kelapure, Halgaonkar. (2019). Online Voting: Voting System Using Blockchain.
2. Srhir, S. (2019). The Integration Of Blockchain Technology In The Supply Chain Management. T.C. Marmara University Social Sciences Institute Business Administration Masters Of Production Management With Thesis.
3. Ali, M., Nelson, J. C., Shea, R., & Freedman, M. J. (2016). Blockstack: A global naming and storage system secured by blockchains. In USENIX Annual Technical Conference (pp. 181–194).

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MEMBER ROLES
All members participated generally in the discussion, conducting research and gathering information relevant to the group’s objective. Individual roles are as follows:

1. Victor Kedenge:

• Created agendas and distributed them to the team.
• Scheduled and led the meeting.

2. John Brown, Beth Owala, Julius Gichure, Abdirahman Aden, Morris Kivuti:

• Conducted editing.
• Taking notes and typing.
• Attached necessary illustrations.
• Typesetting and formatting.

3. Sharon Imali:

• Concluded.