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Wednesday, December 27, 2017
2017 Word of the Year - blockchain
Word of the Day
Daily updates on the latest technology terms |December 27, 2017
The 2017 Word of the Year is Blockchain!
Blockchain is a type of distributed ledger for maintaining a permanent and tamper-proof record of transactional data. A blockchain functions as a decentralized database that is managed by computers belonging to a peer-to-peer (P2P) network.
Each of the computers in the distributed network maintains a copy of the ledger to prevent a single point of failure (SPOF) and all copies are updated and validated simultaneously. Because information is shared and continually reconciled by thousands, even millions of computers, it is almost impossible to corrupt a blockchain. If one node goes down or becomes corrupt, it's not a problem because all the other nodes have a verified copy of the ledger.
In the past, blockchains were commonly associated with digital currencies, and Bitcoin in particular. Today, blockchain applications are being explored in many industries as a secure and cost-effective way to create and manage a distributed database and maintain records for digital transactions of all types.
A blockchain ledger consists of two types of records: individual transactions and blocks. The first block consists of a header and data that pertains to transactions taking place within a set time period. The block's timestamp is used to help create an alphanumeric string called a hash.
After the first block has been created, each subsequent block in the ledger uses the previous block's hash to calculate its own hash. Before a new block can be added to the chain, its authenticity must be verified by a computational process called validation or consensus. At this point of the blockchain process, a majority of nodes in the network must agree the new block's hash has been calculated correctly. Consensus ensures that all copies of the distributed ledger share the same state.
Once a block has been added, it can be referenced in subsequent blocks, but it cannot be changed. Should someone attempt to manipulate the data in a block, the change will automatically alter the hashes for previous and subsequent blocks, which disrupts the ledger's shared state and breaks consensus. When consensus is lost, no new blocks can be added to the chain until the block that is preventing consensus has been identified and discarded.
Blockchain platforms can be either permission-less or permissioned. In a public, permissionless blockchain like Bitcoin, every node in the network can conduct transactions and participate in the consensus process. In a private, permissioned chain like Multichain, every node might be able to conduct transactions, but participation in the consensus process is restricted to a limited number of approved nodes. Choosing which consensus algorithm to use is perhaps the most important aspect of selecting a blockchain platform.
Quote of the Day
"I predict that Blockchain will prove to be the architecture for machine-to-machine (M2M) transactions and allow a surprisingly diverse number of internet-connected devices to exchange currency autonomously, as well as data." - Margaret Rouse
Blockchain for Dummies In this excerpt from chapter five of 'Blockchain for Dummies,' author Tiana Laurence covers Ethereum, decentralized autonomous organizations and smart contracts.
IT goals for 2018: Five CIO must-dos There are a number of new and interesting technologies that deserve a look. We are looking at blockchain to overhaul our approach to identity management and data privacy.
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