Distributed Ledger Technology: All about Blockchain

The technological architecture and protocols that allow simultaneous access, validation, and record updating in an immutable way across a network that spans numerous entities or places are referred to as Distributed Ledger Technology (DLT). DLT, also known as blockchain technology, was popularised by Bitcoin and has since been a buzzword in the IT world due to its potential in a variety of industries and sectors. In simple terms, the DLT pits a "decentralised" network against a traditional "centralised" mechanism, and it is expected to have far-reaching consequences for industries and entities that have traditionally relied on a trusted third-party.

The Process

Each node in a distributed ledger processes and validates each item, resulting in a record of each item and an agreement on its authenticity. Static data, such as a registry, and dynamic data, such as financial transactions, can both be recorded in a distributed ledger. DLT (Distributed Ledger Technology) is a protocol that allows a decentralised digital database to run securely. The necessity for a central authority to maintain a check on manipulation is eliminated with distributed networks. Using encryption, DLT provides for the secure and accurate storing of any information. Using "keys" and cryptographic signatures, the same can be obtained. Once the data is saved, it becomes an immutable database that is subject to the network's rules.

The concept of a distributed ledger isn't entirely new, and many businesses already store data in multiple locations. Each location, on the other hand, is usually connected to a central system that updates each of them on a regular basis. Because a central entity must update each remotely situated note, the central database is vulnerable to cyber-crime and prone to delays.

Security

Because all of the copies kept across the network must be attacked at the same time for the attack to be successful, a decentralised ledger is impervious to cyber-crime. Furthermore, the simultaneous (peer-to-peer) sharing and updating of records speeds up, improves, and lowers the cost of the operation. DLT has the ability to completely transform the way governments, institutions, and businesses operate. It can assist governments with tax collecting, passport issuing, land registry and licence recording, and the distribution of Social Security payments, as well as voting procedures. Finance, music and entertainment, diamonds and other precious assets, art, supply networks of various commodities, and other businesses are all benefiting from the technology.

Big Forces

Many large corporations, such as IBM and Microsoft, are experimenting with blockchain technology in addition to startups. Ethereum, Hyperledger Fabric, R3 Corda, and Quorum are some of the most prominent distributed ledger protocols.

Interest in distributed ledger technology developed dramatically in the decade following the 2009 debut of bitcoin, a cryptocurrency based on blockchain technology that was the first to show that the technology could not only work but also scale and remain secure. Organizations across industries began experimenting with DLT and how it may be used in enterprise processes from that point forward. Early leaders included the financial services, healthcare, and pharmaceutical industries, with supply chain management being a common use.