There's a lot of buzz around Blockchain, Is Blockchain the next” Big Thing" in the IT industry? It certainly looks to have a huge impact in finance, but it could also have far reaching effect in many other industries as well
• What is Blockchain
• Elements of Blockchain
• Blockchain benefits
• Future Aspects
• Oracle Blockchain solution
Remember the movement around 'digital transformation' that started a while ago and redefined
several paradigms? It changed the way we shopped, traveled, transacted, communicated, and ran
our daily functions backed by innovative technologies like IoT, AI, Augmented reality, Gamification,
Beacon, blockchain etc.
There's a lot of buzz around Blockchain, Is Blockchain the next "Big Thing" in the IT industry? It
certainly looks to have a huge impact in finance, but it could also have far reaching effect in many
other industries as well.
Hence it is imperative of Business to understand key drivers and enablers to embark on paradigm
shift with blockchain technology.
A Network of so-called computing nodes make up blockchain
A blockchain is fundamentally a distributed ledger that allows multiple authorized parties to make
changes in an agreed upon manner.
Since it relies on both cryptography and private/public encryption to validate transactions,
Blockchain is generally regarded as being highly secure. "Public-key encryption provides record-level
security of data and there is no single point of failure as the network is resilient against attacks on
• To achieve temper-evidence in the
ledger, blockchain exploits
cryptographic hash functions.
• In simple terms, hashing means
taking an input string of any length
and giving out an output of a fixed
• Blockchain use SHA-256 hashing
algorithm, no matter how big or
small your input is, the output will
always have a fixed 256-bits length
6. What makes it Unique
• Small change in input will make change in output
hash, this is a critical function because this
property of hashing leads to one of the greatest
qualities of the blockchain, its immutability.
• Each transaction or contract between two (or
more) members in the network requires
verification or validation by the network itself,
without going through an independent arbitrator.
This is achieved by incorporating a verification
scheme in the protocol.
• The blockchain technology is flexible enough to
accommodate a suitable form of decentralized
appending process, known as mining in general.
Note that the mining and consensus schemes
constitute the backbone for any blockchain
protocol, and hence should be chosen carefully.
7. Elements to the Blockchain technology
There are four essential elements to the Blockchain technology.
• The Distributed Ledger Technology – this is a database that is consensually shared, replicated, and
synchronized across a network that is spread across multiple sites, institutions, and geographies.
• The Smart Contracts – it is code that is capable of facilitating, executing, and enforcing the
negotiation or performance of agreement (i.e., contract) using the Blockchain technology. It runs
on the nodes and invokes a request to the Consensus.
• The Consensus Protocols – the Blockchain is updated via a Consensus protocol. It ensures an
unambiguous ordering and validation of transactions and guarantees the integrity and
consistency of the Blockchain across geographically distributed nodes. Some Consensus protocols
are decentralized/permission less, and some are permissioned (think Byzantine). Other
Consensus protocols are Raft, Paros, Sieve, etc.
• The Messaging Service – this enables inter-node communication among blockchain peers.
8. Blockchain Example – Bitcoin technology
Let us illustrate the generic structure of a permission less blockchain architecture by taking the pioneering
blockchain application–Bitcoin–as an example.
• Block: A Bitcoin block contains the hash of itself, the hash of the previous block, the Merkle root of the
transactions that are included in the block, a nonce that is used by a miner to solve the Bitcoin
computational hash-puzzle, and the time at which the block was created
• Verification: Verification of Bitcoin transactions is performed through scripts, implemented in a Turing
incomplete stack based scripting language
• Mining: Bitcoin follows a competitive mining scheme, based on a hash-puzzle. The miners have to
compete with one another, using the computing resources at their disposal, to append a new block to
the blockchain ledger
• Consensus: Bitcoin follows a standard majority consensus, where each miner may choose which block
in the chain to append to, and eventually the longest chain sustains.
10. Blockchain Technology Benefits
Because decentralized applications run on the blockchain, they benefit from all of its properties.
• Immutability – A third party cannot make any changes to data.
• Corruption & tamper proof – Apps are based on a network formed around the principle of
consensus, making censorship impossible.
• Secure – With no central point of failure and secured using cryptography, applications are well
protected against hacking attacks and fraudulent activities.
• Zero downtime – Apps never go down and can never be switched off.
• Transparency – Data is embedded within network as a whole, it can be public or specific to a
11. • Supply chain Management
Blockchain can be used to monitor costs, labor, and even waste and
emissions at every point of the supply chain. This has serious
implications for understanding and controlling the real environmental
impact of products. The distributed ledger can also be used to verify
the authenticity or fair trade status of products by tracking them from
• Banking and Payment
It can be used to give access to financial services to billions of people
around the world, including those in third world countries who don’t
have access to traditional banking. Bitcoin allows anyone to send
money across borders almost instantly and with relatively low fees.
Digital currency like Bitcoin has already taken world by storm though
not accepted in India for now.
12. • Insurance
The global insurance market is based on trust management. The
blockchain is a new way of managing trust and can be used to verify
many types of data in insurance contracts, such as the insured person’s
blockchain smart contracts are useful for any type of insurance that
relies on real-world data, for example crop insurance
• Networking and the Internet of Things
Samsung and IBM are using blockchain technology for a new concept
called ADEPT, which will create a decentralized network of IoT devices,
Smart contracts make the automation of remote systems management
possible. A combination of software, sensors, and the network
facilitates an exchange of data between objects and mechanisms. The
result increases system efficiency and improves cost monitoring.
Devices would be able to communicate to each other directly to
update software, manage bugs, and monitor energy usage etc.
13. • Cloud Storage
Data on a centralized server is inherently vulnerable to hacking, data
loss, or human error. Using blockchain technology allows cloud storage
to be more secure and robust against attack.
Oracle has announced own Oracle Blockchain Cloud Service(BCS) at
Oracle OpenWorld 2017
• Private Transport and Ride Sharing
The blockchain can be used to create decentralized versions of peer-to-
peer ridesharing apps, allowing both car owners and users to arrange
terms and conditions in a secure way without third party providers.
The use of built-in e-wallets can allow car owners to automatically pay
for parking, highway tolls, and electricity top-ups for their vehicle. UBS,
ZF and Innogy are some of the companies developing blockchain based
14. • Voting
During recent Indian and US election certain parties were accused of
rigging election results. Blockchain technology can be used for voter
registration and identity verification, and electronic vote counting to ensure
that only legitimate votes are counted, and no votes are changed or
removed. Creating an immutable, publicly-viewable ledger of recorded
votes would be a massive step toward making elections more fair and
Common complaints in the charity space include inefficiency and
corruption, which prevent money from reaching those that are meant
to have it. Using blockchain technology to track donations can let you
be sure your money is going to end up in the right hands
15. • Public Benefits
The public benefits system is another sector that suffers from slowness and
bureaucracy. Blockchain technology can help assess, verify, and distribute
welfare or unemployment benefits in a much more streamlined and secure
The blockchain is also a good contender for implementing a basic income.
Government systems are often slow, opaque, and prone to corruption.
Implementing blockchain-based systems can significantly reduce
bureaucracy and increase security, efficiency, and transparency of
government operations. Dubai, for example, is aiming to put all its
government documents on the blockchain by 2020.
16. • Retail
When you shop, your trust of the retail system is tied to the trust of the
store or marketplace. Decentralized blockchain-based retail utilities work
differently: they connect buyers and sellers without a middleman and
associated fees. In these cases, trust comes from smart contract systems,
the security of exchanges, and built-in reputation management systems.
One of the challenges hospitals face is the lack of a secure platform to store
and share data, and they are often victims of hacking because of outdated
infrastructure. Blockchain technology can allow hospitals to safely store
data like medical records and share it with authorized professionals or
patients. This can improve data security and can even help with accuracy
and speed of diagnosis.
17. • Crowdfunding
Crowdfunding has become a popular method of fundraising for new
startups and projects in recent years. Crowdfunding platforms exist to
create trust between project creators and supporters, but they also
charge high fees. In blockchain-based crowdfunding, trust is instead
created through smart contracts and online reputation systems, which
removes the need for a middle-man. New projects can raise funds by
releasing their own tokens that represent value and can later be
exchanged for products, services, or cash.
• Real Estate
Some of the issues in buying and selling real estate are bureaucracy, lack of
transparency, fraud, and mistakes in public records. Using blockchain
technology can speed up transactions by reducing the need for paper-
based record keeping. It can also help with tracking, verifying ownership,
ensuring accuracy of documents, and transferring property deeds
Oracle just announced its own Oracle Blockchain Cloud Service(BCS) at Oracle Open World
2017. Oracle’s Blockchain Cloud Service(BCS) is an enterprise-grade distributed ledger
based platform designed to extend and scale ERP, SCM and SaaS and on-premise
applications. It is designed to perform secure and scalable peer-to-peer transactions
across a trusted network with tamperproof data.
Oracle has partnered with the Hyperledger Project (www.hyperledger.org), a consortium
focused on private (or permissioned) Blockchain-based distributed ledgers and solutions
across a variety of use cases and industries. The Hyperledger Fabric is an open source
code base, managed as a project of the Linux Foundation.
The Hyperledger supported solutions are also designed to run smart contracts through a
combination of a modular architecture and consensus protocols. Oracle has also
partnered with leading systems integrators and partners to deliver complete Blockchain
For more information on the benefits of Oracle’s Blockchain services, please visit:
19. Oracle Blockchain Cloud Service
• Oracle Blockchain Cloud Service is a network consisting of
validating nodes (peers) that update the ledger and
respond to queries by executing smart contract code—the
business logic that runs on the blockchain.
• External applications invoke transactions or run queries
through client SDKs or REST API calls, which prompts
selected peers to run the smart contracts.
• Multiple peers endorse (digitally sign) the results, which
are then verified and sent to the ordering service. After
consensus is reached on the transaction order, transaction
results are grouped into cryptographically secured,
tamper-proof data blocks and sent to peer nodes to be
validated and appended to the ledger.
• Service administrators can use the Oracle Blockchain
Cloud Service web console to configure the blockchain and
monitor its operation.