Our earlier blogs detailed out Dubai’s interest in Blockchain technology, the three pillars of blockchain implementation, and an understanding of blockchain model – today we intend to dig deeper into the types of blockchain.
The reach of Blockchain will go far beyond than what it was intended for. While banking is only the beginning, Blockchain will slowly introduce itself in the sectors like cybersecurity, healthcare, automobile, education, sports management and what not!
Blockchain establishes trust, accountability, and transparency, while streamlining business processes. It is a peer-to-peer distributed ledger technology for a new age transaction application.
So what are Open Blockchain?
According to the tech giant IBM, “Open Blockchain is a ledger of digital events, called transactions, shared among different participants, each having a stake in the system. The ledger can only be updated by consensus of the participants, and, once recorded, information can never be altered. Each recorded event is cryptographically verifiable with proof of agreement from the participants.”
Examples range from Bitcoins to Litecoins.
And what are Closed Blockchain?
Exactly opposite as the name suggests, a Closed Blockchain is a private network that maintains a shared record of transactions. The network is accessible only to those who have permission and transactions can be edited by administrators. Some also refer Closed Blockchain as Database.
Examples: Hyperledger, Ripple, Eris
The whole point of distributed ledger having maximum integrity is lost.
One of the core design principles behind a blockchain is that it’s immutable. However since a Closed Blockchain is edited by an administrator, it will be difficult to keep a track on the central actors since they rely on trust. Because of all these, it is going to be extremely critical on who you give access to.
But not even an Open Blockchain is absolute.
Having Blockchain Open (like Bitcoins) means you trust no human but trust computer algorithms and machine learning. So basically you believe in no-one which makes everyone trustworthy. Just like the internet. Where we need only basic permissions (like Logging in) to communicate or use Google for search.
The most striking thing about having Blockchain as an Open source is programmers can build programs and applications using them. Just like IFTTT (IF This Then That). They are a free web-based service that people use to create chains of simple conditional statements, called applets.
Andreas M. Antonopoulos, one of the most respected Bitcoin expert terms it as ‘Innovation without Permission’. In one of the Bitcoin meet-up group Milwaukee, WI Feb 2014, Mr Andreas said, “When was the last time you saw someone build a bank out of their garage, and disrupt the financial services system to its core? Never. Why? Because they’re not given access, because access has to be trusted. On bitcoin anyone can create an application, and can innovate, and create new financial instruments. And that is pretty radical.”
This debate of having Open Blockchain or Closed Blockchain is taking rounds in various start-ups and educational institutions lately. Fintech Valley Vizag is hosting global Blockchain gurus under one roof on 9-10 October 2017 in Novotel, Vizag at the first Blockchain Business Conference. It features Blockchain experts who are nothing less than the foundation for new value creation in this emerging field.
For more information on the conference, get in touch with Vijay Walter, Head of Production on [email protected] or +9176196 13563