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Overview and Importance of Blockchain Technology and Examining Blockchain Architecture | Ministry of Industry and Technology of Turkiye

Overview and Importance of Blockchain Technology and Examining Blockchain Architecture | Ministry of Industry and Technology of Turkiye

“Overview and Importance of Blockchain Technology and Examining Blockchain Architecture” is the first session.

Blockchain technology has gained significant attention in recent years due to its potential to revolutionize various industries. In this article, we will cover the fundamentals of blockchain technology, its importance in different sectors, and delve into the intricate details of blockchain architecture.

Introduction to Blockchain Technology
Blockchain technology can be defined as a decentralized, distributed ledger technology that securely records and verifies transactions across multiple participants. Unlike traditional centralized systems, blockchain operates on a peer-to-peer network, where participants, known as nodes, connect and collaborate to maintain the blockchain. Each node has a copy of the entire blockchain and participates in transaction validation and block creation.

The core principles of blockchain technology are decentralization, transparency, security, immutability, consensus, and smart contracts. These principles form the foundation of blockchain’s functionality and distinguish it from conventional systems.

Overview of Blockchain Architecture
Blockchain architecture is the underlying framework that enables the functioning of a blockchain system. Let’s explore the basic components and architecture of a blockchain system:

Network and Nodes:
A blockchain operates on a peer-to-peer network, where participants connect and collaborate to maintain the blockchain. Each node has a copy of the entire blockchain and participates in transaction validation and block creation. Nodes communicate and agree on the validity of transactions and blocks using the chosen consensus mechanism. Through consensus, a shared view of the blockchain is maintained, ensuring consistency and trust among participants.

Public vs. Private Blockchains:
Blockchain networks can be categorized as public or private, depending on their accessibility and permissioning.

Public Blockchains:
Public blockchains are open to anyone who wants to participate and contribute to the network. Examples of public blockchains include Bitcoin and Ethereum. They offer decentralization, transparency, and security. However, they face scalability challenges and have limited privacy features.

Private Blockchains:
Private blockchains are restricted to specific participants who have permission to join and validate transactions. Examples of private blockchains include Hyperledger Fabric and Corda. They offer efficiency, enhanced privacy, and selective access. However, they may be more centralized compared to public blockchains.

Importance of Blockchain Technology in Various Industries:
Blockchain technology has immense potential to transform various industries. Let’s explore some of its applications:

Finance:
Blockchain technology has disrupted the financial sector by enabling faster and more secure transactions. It facilitates peer-to-peer transfers of digital assets, eliminating the need for intermediaries like banks. Additionally, blockchain-powered cryptocurrencies provide decentralized and transparent alternatives to traditional fiat currencies. Blockchain also offers solutions for cross-border payments, remittances, and smart contract-based lending, making financial processes more efficient and inclusive.

Supply Chain:
Blockchain has transformed supply chain management by increasing transparency and traceability. It enables the creation of an immutable record of every step in the supply chain, reducing fraud, counterfeiting, and unauthorized products. By tracking and verifying the origin, quality, and movement of goods, blockchain technology improves efficiency, ensures ethical sourcing, and enhances consumer trust.

Healthcare:
Blockchain has the potential to revolutionize the healthcare industry by providing secure storage and sharing of patient data. It allows patients to have control over their medical records, granting access to healthcare providers as needed. This decentralized approach improves data security, interoperability, and privacy while reducing administrative costs. Additionally, blockchain can facilitate clinical trials, supply chain management for pharmaceuticals, and the tracking of medical devices.

Government:
Governments are exploring the use of blockchain technology to enhance transparency, security, and efficiency. Blockchain can facilitate secure voting systems, streamline administrative processes, and improve the distribution of welfare benefits and aid. It offers a decentralized and trustless approach, reducing the risk of corruption and improving public services.

As the technology continues to evolve, it is expected to drive further innovation and transformation, revolutionizing how industries operate in the digital age. The implementation of blockchain has shown tangible benefits in terms of cost savings, efficiency improvements, and enhanced trust and security. Understanding the differences and use cases of public and private blockchains is crucial in selecting the appropriate type based on the specific requirements of a given application or industry.

Blocks:
Data Structure: Data in a blockchain is structured into blocks, with each block containing a batch of transactions. Depending on the blockchain’s purpose, these transactions can include various types of information.

Unique Identifier: Each block in the blockchain is assigned a unique identifier called a hash. This hash is generated using cryptographic algorithms and serves as a digital fingerprint for the block.

Hashing:
Cryptographic Process: Hashing is a cryptographic process where data from a block is converted into a fixed-length string of characters, known as a hash. This process is one-way, meaning it is computationally infeasible to derive the original data from the hash.

Chain Structure:
The hash of each block is included in the subsequent block, creating a chain-like structure. This linkage ensures the integrity and immutability of the blockchain. Any alteration in one block would result in a change in subsequent block hashes, making it evident that tampering has occurred.

Consensus Mechanisms:
Consensus mechanisms are methods used to achieve agreement, trust, and security across a decentralized computer network. They play a vital role in maintaining the integrity and consensus of the blockchain. Two popular consensus mechanisms are proof-of-work (PoW) and proof-of-stake (PoS).

Proof of Work (PoW):
This consensus algorithm is famously used in the Bitcoin blockchain. Miners compete to solve complex mathematical puzzles, requiring significant computational power. The first miner to solve the puzzle and validate the block of transactions is rewarded with newly minted cryptocurrency. PoW ensures that the majority of participants agree on the state of the blockchain.

Proof of Stake (PoS):
In PoS, the right to validate blocks is determined by the participants’ stake or ownership of cryptocurrency. Validators, known as “stakers,” are chosen randomly or based on the amount of cryptocurrency they hold. PoS consumes less energy compared to PoW and aims to reduce the computational power required for consensus.

These are just a few examples of consensus algorithms used in blockchain networks. The choice of consensus mechanism depends on factors such as security, scalability, energy efficiency, and the specific requirements of the blockchain network.

In conclusion, blockchain technology holds immense potential to reshape industries by providing decentralized, transparent, and secure solutions. Its architecture, consensus mechanisms, and applications are paving the way for a future where trust and efficiency are paramount. Embracing blockchain technology can unlock new possibilities and create a more inclusive and trustworthy digital ecosystem.

This video is part of a consultation session on “Technical Expert Service on Improvement of Public Sector Efficiency Using Blockchain-based Database”. The implementing organizations include the Ministry of Industry and Technology of Turkiye and the Asian Productivity Organization. The event was held in Ankara and Bolu, Turkiye, from 4–7 July 2023.

 

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

The importance of an open metaverse

The importance of an open metaverse

Digitisation has progressed and grown from Web1, the first worldwide web built on open source technologies and open standards such as HTML/HTTP. These protocols served as the foundation for technological giants such as Amazon, Microsoft, and Apple. Then came the Web2 shift; the technology was primarily focused on user-generated content; the most significant innovation brought about by this progression are social networks such as Facebook/Meta, Twitter, and many more.

Notably, the majority of Web2 technologies were based on the same open and standard Web1 technology. The internet on which the web is built was the result of work from the 1960s to 1990s from research labs and universities largely in the public sector. As not-for-profit, they focused on establishing open standards for ease of information sharing. The only difference is that user-generated content and information on Web2 platforms are contained within siloed ecosystems. Today the internet Web2 giants such as Amazon and Google come from the foundations laid in the internet era.

We are once again at a crossroads in the evolution of the Web into a new decentralised iteration known as Web3. Through features such as value exchange and decentralization, Web3 aspires to shift the paradigm of previous iterations. Users will now be able to get value in exchange for the content value they contribute, and decentralised systems will be built to empower users. In another sense, however, Web3 is an attempt to return to the earliest visions of the open web, built on a common neutral network.

As the inventor of the World Wide Web, Tim Berners-Lee said: “The web was designed to be decentralised so that everybody could participate by having their own domain and having their own webserver and this hasn’t worked out. Instead, we’ve got the situation where individual personal data has been locked up in these silos. […] The proposal is, then, to bring back the idea of a decentralised web.”

With Web3, who we are online as individuals is becoming increasingly significant, and it will become even more so in the future. Most significantly, Web3 contributes to the development of a framework and infrastructure for the metaverse, an activity-based immersive ‘always on’ digital environment. Therefore, in this article, we will investigate the concept of the metaverse and the importance of interoperability to enable a sustainable digital world.

What is the metaverse?

When you think of an HTML interface, you are looking at a product of the Web1. At the dawn of the internet, the HTML interface was a basic and straightforward way for individuals to engage with the digital world. With the introduction of video calls and other features, the second version of the worldwide web, Web2, resulted in a more sophisticated and social media-oriented way to use the internet.

In comparison the Web3 is a complete paradigm shift, bringing an improved interface that will expand to spatial computing, AR wearables, virtual reality, and other connected devices, enabling unprecedented levels of creativity and engagement. Our ability to connect more in the digital world of the metaverse will result in the formation of entirely new marketplaces and the emergence of new protocols and ecosystems. As metaverse guru Matthew Ball explained: “The Metaverse will not develop as the internet did. Public institutions, military research labs, and independent academics led the latter’s development because they were effectively the only ones with the computational talent, resources, and ambitions to build a World Wide Web, and few in the industry understood its commercial potential. None of this is true when it comes to the Metaverse.”

The importance of ‘interoperability’ in the metaverse

One of the most popular and most powerful Web2 platforms, Facebook, recently announced a rebranding as Meta, a metaverse-focused company. Meta and other Web2 juggernauts such as Amazon, Facebook, and Apple are developing and acquiring the technology and toolsets needed to build their ‘walled garden’ version of the metaverse.  These platforms all want to establish their own rules for what the metaverse should be like, but they refuse to give up their feeling of propriety ownership.

Gaming ecosystems such as Unity used to be the sole understandable concept of the metaverse, but as new standards are developed, there is bound to be more uncertainty about a metaverse built on open standards and easy interoperability. “For the Metaverse to thrive, we need developers to thrive. And this means making it as easy to take a virtual immersive educational environment or AR playground from one platform to another as it is to move a blog or newsletter,” argues Ball.

The rise of centralised Web2 platforms in the Web3 world may stifle the development of decentralised systems in the metaverse. The epitome of Web20 is siloed ecosystems, harvesting your data to turn a profit through hyper-targeted advertising; if each platform sets its metaverse standards, the risk is that Web3 will simply become a more hi-tech version of the current siloed ecosystems. As Epic Games CEO Tim Sweeney warned in 2016 when talk of the decentralised web was starting to become popular, the metaverse is going to be “far more pervasive and powerful than anything else. If one central company gains control of this, they will become more powerful than any government and be a god on Earth”.

The Digital Living Network Alliance (DLNA), created in 2003, is one alliance that has had a significant impact on the World Wide Web. It was a group of global companies who came together to make it simple to connect and enjoy photos, music, and video across networked consumer products, PCs, and mobile devices. This, according to the Alliance, meant that industry collaboration and standards-based interoperability resulted in attractive products. This collaboration resulted in the simple, innovative digital products that we now have on the market, including TVs, DVD and Blu-ray players, games consoles, and digital media players.

BigONE believes that a similar partnership for Metaverse companies would aid in the establishment of a common standard protocol for metaverse interoperability. The key challenge for such open standards to be fit-for-purpose for the metaverse is this: they need to offer a compelling financial incentive to developers above and beyond a ‘wall garden’ platform from a Meta or a Disney.

There are grounds for optimism. Take the example of venture capital platform Outlier Ventures which is working on an operating system called Open Metaverse OS, a decentralised set of tools and technologies designed to operate only through open standards and APIs. In addition, they’ve developed a framework for assessing metaverses and toolkits for creating “user-centric” metaverse solutions based on Web3 principles.

While Boson Protocol aims to provide a decentralised platform for commerce, “a peer-to-peer system which replicates the benefits of a market intermediary, without the disadvantages of centralised systems”. There is already an open standard that allows for inter-operability from the get-go, with a payments system that is metaverse-friendly: the blockchain and the cryptocurrencies that sit on top of it.

What lies ahead?

The world is starting to get a taste of what the metaverse can offer to our lives and businesses. People can now work in a foreign company from the comfort of their own home, blurring the divide between the physical and digital worlds. We have to understand that metaverse is another unit, another, another universe that we can play in and do a lot of things and activities together in a virtual space. If I wanted to order some fried chicken or pizza, I could do it in the metaverse and have it delivered to us.

BigONE and I believe that there will be several metaverses or different types of personalised digital worlds where people can connect. Still, the most important thing is that there will be a standard and that these platforms will be interoperable in such a way that developers can profitably build new services. The metaverse may be still in its early stages, and there is much to learn, but one thing is sure: interoperability is required for an open metaverse to succeed.

 

Original Source: https://e27.co/the-importance-of-an-open-metaverse-20220106/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

What’s the importance of cryptocurrency payments going mainstream?

What’s the importance of cryptocurrency payments going mainstream?

A sign of the growing mainstream acceptance of cryptocurrency came recently with the announcement that US-based cinema chain AMC will soon be accepting cryptocurrency payments. It comes just a few months after PayPal decided to allow US consumers to use crypto to make purchases, and news that Mastercard would be supporting cryptocurrency payments across its network. The question is though, while use of crypto for financial transactions may makes sense, is buying your movie tickets and popcorn with Bitcoin worth the bother?

In August, AMC announced that it would for the first time accept Bitcoin as payment. This was followed by news that moviegoers could also pay for tickets online with Ethereum, Litecoin, and Bitcoin Cash. AMC’s CEO Adam Aron tweeted: “Cryptocurrency enthusiasts: you likely know @AMCTheatres has announced we will accept Bitcoin for online ticket and concession payments by year-end 2021. I can confirm today that when we do so, we also expect that we similarly will accept Ethereum, Litecoin and Bitcoin Cash.” One unexpected reaction to the news came from the Dogecoin community on Twitter, who see the meme coin as a more natural crypto payment coin.

Top DogeCoin YouTuber @Mark Wallace tweeted in reply to Aron: “You could have effortlessly had millions of new supporters by accepting #Dogecoin. No reason not to when you literally accept Litecoin which is also based off BTC. Selling all my AMC stock to buy more $Doge. Ridiculous.” The strength of reaction is perhaps not surprising considering that Shark Tank star and billionaire owner of the NBA team Dallas Mavericks, Mark Cuban, told US-broadcaster CNBC recently that not only is Dogecoin “a medium that can be used for the acquisition of goods and services,” but that also “the community for doge is the strongest when it comes to using it as a medium of exchange”.

Certainly, BigONE believes that mainstream cryptocurrency adoption is a key driver in the price of digital currencies earlier this year. This belief is supported by global finance executives polled by ‘Big Four’ auditors Deloitte. In Deloitte’s 2021 Global Blockchain Survey, 81% of the financial services executives believe that blockchain technology is “broadly scalable” and has achieved mainstream adoption. In the retail sector, Walmart and Amazon’s crypto recruitment announcements have raised awareness that these retail behemoths may be planning to open their doors to cryptocurrencies. It maybe a little ambitious to believe the giant online retailer Amazon will go as far as implementing Dogecoin for payment purposes, but that hasn’t stopped a petition titled ‘Doge4Amazon’ from picking up strong community support in 2021. Started three years ago with 20k supporters, in a sign if then times in the last 6 months its jumped from 75k, to 100k, and now to close to 250K signatures. Consumers can already use cryptocurrency to pay at other retailers such as Overstock, Best Buy, and Starbucks via third-party apps.

What’s the importance of cryptocurrency payments?

When Bitcoin was first introduced in January 2009, it promised to be the world’s first digital currency that did not require the support of a bank or government, its supporters claiming it promised a decentralized payment method that would change the world’s economic structure. With the emergence of more and more cryptocurrencies, the total market value has surpassed $2 trillion. Although blockchain technology is transforming many industries, cryptocurrency has yet to reach its full potential as a payment method.

One of the main factors influencing the adoption of cryptocurrency by both businesses and consumers as a payment method is its volatility. While Bitcoin’s price has risen by more than 50 million percent since its inception at $0.08, it has experience d many peaks and troughs in value along the way, making people wary of using it for consumption. For example, by the end of 2013, bitcoin had reached a fresh new high of US$1,164. But before reaching its 2021 peak, Bitcoin moved much lower before going higher — between 2014 and 2015, stagnation and volatility chipped away at the crypto’s value, reducing it to US$245 by October 2015, according to an analysis in Blockchain Investing News.

While there are certainly challenges in accepting Bitcoin for payments, especially when the price volatility is factored in, more and more merchants are looking to add crypto purchasing to their business. According to a survey last year by BitPay, “up to 40% of customers that pay with crypto are new to the merchant. Second, purchase amounts are twice that of credit card purchases. Third, crypto is less expensive than card cards, and lastly, there are no fraud-related chargebacks”.

Bitcoin has received a lot of attention as a store of value, which is why people like Mark Cuban consider it digital gold. Unfortunately, the use of cryptocurrency in daily payments has been hampered by high transaction fees and relatively slow transaction speeds. BigONE believes that now that AMC has decided to accept Litecoin, Bitcoin Cash, and Ethereum, the use of crypto will become more attractive to businesses. With Litecoin and Bitcoin Cash are designed to be faster and cheaper versions of Bitcoin, they could be better suited for digital payments going forward.

That said, the recent legalization of Bitcoin in El Salvador shows that adoption of BTC for payments can come from unexpected quarters. As reported in Cointelegraph the recognition of Bitcoin (BTC) as legal tender has opened up new payment options for its citizens, with fast-food empire McDonald’s accepting payments in the cryptocurrency through the Lightning Network. “Lightning Network will likely prove invaluable if El Salvador hopes to achieve the mass adoption of Bitcoin payments. Beyond immediate transactions, however, El Salvador’s Bitcoin gambit could prove successful by streamlining global remittances, increasing the wealth of its citizens and attracting crypto-focused entrepreneurs to the country,” the report concluded.

Is it worth using crypto to buy movie tickets?

Popular cryptocurrencies including Bitcoin, Ethereum, Litecoin, and Bitcoin Cash, are all available for purchased on the BigONE Exchange. The question is whether these are better suited for long term investment, than for everyday payment purposes? On the other hand, cryptocurrencies are not company stocks; some were intended to be used as a payment method from the outset. Therefore, improving the cryptocurrency industry’s practicality and adoption rate will be critical to its success in this regard. However, to use your digital currencies as a regular payment method, you should always consider transaction fees and cryptocurrency volatility.

A clear use case for cryptocurrency comes with international money transfers, for example, with low transfer fees and fast transfer speeds, and anyone can use it. “However, Bitcoin has become less attractive for remittances due to the increasing cost of Bitcoin transactions. Some competing cryptocurrencies, such as Ripple and Dash, are also targeting the remittance market with substantially lower fees,” suggested a recent report in Investopedia.

Another critical factor to consider in crypto payments is taxation. Many countries worldwide require cryptocurrencies to be taxed as property. In addition, the holder must report the cryptocurrency’s time of use and purchase and may be subject to capital gains tax. Thus, using your cryptocurrency is the same as selling it to the US tax authority, the IRS. Recording transactions may work for large purchases, but it could prove difficult and expensive for small payments, such as movie tickets. As reported in Forbes, this is because in the US crypto taxes are based on a 2014 ruling that determined cryptocurrency should be treated as a capital asset, rather than a currency like dollars or euros: “Let’s say you bought $20 worth of Bitcoin and held it as it rose in value to $200. If you used the bitcoin to buy $200 worth of groceries, you’d owe capital gains taxes on the $180 in profit you’d realized — even though it seems as if you spent the Bitcoin, rather than sold it. For the IRS, it’s the same thing.”

In simple terms how you use cryptocurrency depends on why you hold cryptocurrency in the first place. For example, if you believe in the wider benefits of decentralization, you are more likely to take advantage of AMC’s new payment option, to pay in crypto for the latest movies. However, you should also regard cryptocurrency as a long-term investment. Indeed, whether AMC’s move will be copied by its competitors remains to be seen. There’s also plenty of support on Twitter in response to the tweeted announcement. Twitter user @SackarisJames and self-proclaimed AMC stockholder posted: “Here come all the ‘why would I spend Bitcoin on movie tickets’ people but in the next breath ‘we need more places to accept crypto, so it becomes a form of currency’”.

 #anndyliansays

 

Shorten version can be found at: https://hackernoon.com/are-crypto-payments-going-mainstream-with-amc-news

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j