Blockchain technology started in 1991 to store and secure digital data. Blockchain is an open ledger that several parties can access at once.
The main components of blockchain technology are a digital ledger and a network of computers (« Mining nodes »). Each node has a copy of the digital ledger updated continuously based on the transactions. In blockchain technology, transactions between any two users go into this digital, decentralized ledger. One of its primary benefits is that the recorded information cannot be modified, as Blockchain is an immutable public digital ledger: each new record becomes – in fact – a block with a unique, identifying hash. Linking the blocks into a chain of records forms a blockchain.
All the transactions in blockchain technology are transparent, meaning that every node in the blockchain network is informed about every trade and updated accordingly.
Blockchain helps verify and trace multistep transactions needing verification and traceability.
This trust is built on blockchain’s enhanced security, greater transparency, and instant traceability. Beyond matters of trust, blockchain delivers even more business benefits, including the cost savings from increased speed, efficiency, and automation. By greatly reducing paperwork and errors, blockchain significantly reduces overhead and transaction costs, and reduces or eliminates the need for third parties or middlemen to verify transactions.
Let’s better see the main benefits of Blockchain:
Your data is sensitive and crucial, and blockchain can significantly change how your critical information is viewed. By creating a record that can’t be altered and is encrypted end-to-end, blockchain helps prevent fraud and unauthorized activity. Privacy issues can also be addressed on blockchain by anonymizing personal data and using permissions to prevent access. Information is stored across a network of computers rather than a single server, making it difficult for hackers to view data.
Without blockchain, each organization has to keep a separate database. Because blockchain uses a distributed ledger, transactions and data are recorded identically in multiple locations. All network participants with permissioned access see the same information at the same time, providing full transparency. All transactions are immutability recorded, and are time- and date-stamped. This enables members to view the entire history of a transaction and virtually eliminates any opportunity for fraud.
Blockchain creates an audit trail that documents the provenance of an asset at every step on its journey. In industries where consumers or customers are concerned about environmental or human rights issues surrounding a product — or an industry troubled by counterfeiting and fraud — this helps provide the proof. With blockchain, it is possible to share data about provenance directly with customers. Traceability data can also expose weaknesses in any supply chain — where goods might sit on a loading dock awaiting transit.
Traditional paper-heavy processes are time-consuming, prone to human error, and often requires third-party mediation. By streamlining these processes with blockchain, transactions can be completed faster and more efficiently. Documentation can be stored on the blockchain along with transaction details, eliminating the need to exchange paper. There’s no need to reconcile multiple ledgers, so clearing and settlement can be much faster.
Transactions can even be automated with “smart contracts,” which increase efficiency and speed the process even further, reducing human intervention as well as reliance on third parties to verify that terms of a contract have been met. Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met: once pre-specified conditions are met, the next step in transaction or process is automatically triggered.
BEFORE BLOCKCHAIN VS. AFTER BLOCKCHAIN: SOME EXAMPLES
Earlier, cyberattacks were a significant threat to the public. Several organizations were developing an effective solution to secure the data against unauthorized access and tampering.
Blockchain quickly identifies malicious attacks due to the peer-to-peer connections where data cannot be tampered with
Every single piece of data stored on the blockchain network is verified and encrypted using a cryptographic algorithm.
By eliminating the centralized system, blockchain provides a transparent and secure way of recording transactions (without disclosing your private information to anyone).
Due to the lack of transparency, supply chain management often had its challenges like service redundancy, lack of coordination between various departments, and lack of reliability.
A product can be tracked with blockchain technology by facilitating traceability across the entire Supply chain. This becomes even more important as supply chains become more complex.
Blockchain gives the facility to verify and audit transactions by multiple supply chain partners involved in the supply chain management system.
Blockchain records a product's transactions (history, timestamp, date, etc.) in a decentralized distributed ledger.
Each transaction is recorded into a block.
With blockchain, anyone can verify a product's authenticity or status.
Within the STARS project, the partners have developed the “STARS Blockchain network & service”, to enable the SMEs participating in the project to start using the technology for their business with our support. The partners of the STARS project are the “Mining Nodes” of the STARS Blockchain network. Discover it here: Stars4Trace Tracking Service.
Of course, the Blockchain and DLT (Distributed Ledger Technologies) networks are several, each with features that suit specific use cases. The STARS partners will help you understand more about this world and will boost your knowledge and skills to make the most of this powerful technology.
