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Transparency: The transactions on the blockchain are available for anyone with permission to check for accuracy or to audit for authenticity. The blockchain ledger can be checked from any internet-connected digital device very conveniently.
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Security: In order for a transaction to be recorded on the blockchain all participants must agree on its validity. Once all agree the transaction is encrypted and incorporated into the new block which is then incorporated into the previous block. The information cannot be tampered with and therefore is secure.
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Traceability: Transactions can be traced very quickly on the blockchain without need for expensive auditors. All information related to a transaction is immediately available without having to dig through paper records or having to access mulitple databases.
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Increased efficiency and speed: Because the transactions are able to be recorded directly to the blockchain without intermediaries they can be accomplished seamlessly, quickly and efficiently.
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Reduced cost: Cutting out intermediaries, auditors, and mulitple databases is less costly. Also, elimination of paper trails and filing, and filing errors, leads to more efficiency and less cost.
Transparency: On a distributed ledger all participants share one document versus having an individual copy of that said ledger. Because all participants share the same ledger on the blockchain they must come to a consensus of transactions being posted to the ledger thus making the ledger more accurate, transparent and easily verifiable. Because the information that is posted to the ledger is in a final state it cannot be modified or altered without the consensus of the network users.
Security: Transactions must be agreed upon before being posted to the blockchain. Before the transaction is posted it is first encrypted and then linked to the previous transaction. This along with the fact that the ledger is hosted across a variety of computers versus just one computer makes it difficult for hackers to manipulate previous transactions and any transactions going forward.
Improved traceability: When transactions are recorded to the blockchain you end up with an audit trail that shows where and when a transaction was posted. The historical transaction data can help to prevent fraud by verifying the authenticity of said transaction.
Increased efficiency and speed: Streamlining and automating processes with the blockchain network allows for transactions to be completed faster and more efficiently. Since everyone is sharing one ledger on the blockchain it then becomes instantly verifiable because you are trusting not just one person with the information. Everyone must come to a consensus before a new transaction is approved and posted, making it easier to trust each other without the numerous intermediaries interferring.
Reduced cost: You wonât need as many intermediaries interfering to make guarantees because you will know the data on the blockchain has been verified before posted. You wonât have to go through so much paper documentation to verify a transaction as truthful because it has already been verified before being posted to the blockchain.
Explain with your own words, why these are the benefits of using a blockchain.
Transparency: For the first time humans would have the ability to verify and follow where transactions are spent. This would be huge when talking in the context of how government funds are allocated and spent.
Security: By spreading the ledger to every node on the network, this removes a central point of failure (a server, company or government) so that the network will always be up and running. It also makes it more secure by relying on protocols and algorithms to ensure the net work is running vs relying on a central entity to keep the system running.
Improved trace-ability; Because it is a public digital ledger, anyone can audit it, track any bit of it, and because its digital it makes accounting much easier.
Increased efficiency and speed: Unlike traditional systems, blockchain runs 24/7/365, and can be globally used. It isnât affected by boarders, and because a new block is mined every ten minutes, your transaction can now happen anytime to anywhere, and if you pay the correct fees you will be included in the next block.
Reduced cost: blockchains don not require all the infrastructure, like the traditional systems. they do not need to pay a ceo, shareholders or other rent seekers. Miners charge for the amount of space you take up in a block,not a % of the transaction. Therefore, blockchains are able to perform the same task for a cheaper cost.
Transparency: nothing is hidden, which benefits all.
Security: It protects from scammers/fraud. Eliminates getting taken advantage of.
Improved traceability: replaces trust with verification.
Increased efficiency & speed: eliminates the middle-men and human error.
Reduced cost: less paper and labor.
Explain with your own words, why these are the benefits of using a blockchain.
Transparency:
The historical ledger of the Bitcoin blockchain with all of its transactional data is permanently distributed and is made visible to those with permission to view those records within the blockchain. These ledgers have the potential to be highly available, 24/7 365 from redundant decentralized sources throughout the blockchain network. If an attempt is made on the blockchain to submit unverifiable data to the blockchain, that data will be ignored. This is due to the specifics of the protocols that are required when processing data within the blockchain. These protocols require that all data must be verifiable and validated before it can be committed to the blockchain. The parameters of the Bitcoin blockchainâs data protocols, its decentralized design, and its unique encryption architecture were developed with many specifications that will simply not allow any data that is unverifiable to be validated and committed to its ledger. Blockchain technology is highly available and very resilient for a variety of reasons and one of those reasons is due in part to the mining component of the blockchain. The mining component of the blockchain incentivizes the computers that validate the data on the blockchain. Because miners are being incentivized to process the data submitted to the blockchain this means that if a computer on the blockchainâs network becomes unavailable or goes offline, then there will almost certainly be others to take its place. Another potential benefit of data being stored on a decentralized blockchain is the potential for that data to be practically immutable when compared to some other methods of data storage such as; paper, hard drives, cloud computing or other more traditional & centralized methods of record keeping. Additionally, Bitcoinâs immutability has the potential to be even greater than other blockchain technologies. This could be the case if you were to compare the Bitcoin blockchain with another blockchain technology that was developed in a more centralized manner. As previously mentioned, Bitcoinâs blockchain records are distributed to multiple decentralized computers which each contain the full ledger of every transaction that has been recorded to its ledger. The data in its ledger is validated by what is referred to as, âconsensusâ, which involves Bitcoinâs verification protocols running amongst each of its many decentralized computers that contain its ledger within the blockchainâs network. Part of Bitcoinâs consensus protocols require each of those data sources to match and verify each other and the ledger they contain before validating, encrypting and committing any new data to its ledger. Because Bitcoin miners are incentivized this promotes Bitcoinâs decentralization.
A new paradigm of data has now been initiated within the technologies of blockchain. As data is processed through a decentralized blockchain network that produces highly encrypted, secured, and validated data from many readily available sources that are all in consensus with each other, that data then enters a new paradigm of trustlessness. The paradigm of trustless data is remarkable because one is no longer required to trust anyone to validate what they say is true concerning a transaction within the blockchain. Within the technology of the blockchain one no longer has certain limitations that often come along with traditional methods of data processing that require you to trust in centralized or limited sources of data. The data in the Bitcoin blockchain becomes trustless because one is no longer required to trust what people say, instead all that is required for trust in the blockchain is the trust in the protocols of the blockchain. With the advent of Bitcoinâs blockchain technology and itâs new data processing protocols, a whole new era of transactional data systems and new financial worlds with untapped possibilities for data and financial ecosystems has been initiated. These blockchain systems offer so many untapped avenues and benefits that have yet to be realized. Already, the blockchain offers highly available, visible, verified, validated, efficient, secured, transparent and trustless data. Plus Bitcoin blockchain data is arguably stored in a much more reliable way when compared to other traditional or centralized means of record keeping. When data is stored with Bitcoins blockchain protocols it is much more reliable because it is verifiable, validated and immutable. These features also create the potential for much more transparency if needed, when compared to traditional means of record keeping. Within traditional or centralized means of record-keeping, one cannot necessarily trust, verify or rely upon a limited set of records that could potentially be subjected to multiple points of failure. For instance, centralized records might be kept in a limited set of locations or may be controlled by a limited number of custodians. Furthermore, those limited locations & custodians may not necessarily be as capable, trustworthy, or have the same ability to produce reliable, verifiable and valid data at the same level as that of a decentralized blockchain. Within the old paradigm of central or traditional record-keeping, there are just too many potential points of weakness. Some of the potential points of weaknesses include; trust, reliability, security, inefficiency, and corruption. All of these inherent points of weakness in traditional methods of record keeping are threats that could potentially lead to the comprise, loss, limitation, and availability of data. Such compromises leave traditional records susceptible to occlusion relative to the blockchainâs Inherent traits of transparency. Some of the traits inherent to Bitcoinâs decentralized methods of record keeping that make its data more transparent include; visibility, validity, affordability, availability, security, auditability, efficiency, and speed. All of these traits enable Bitcoin to be transparent for use cases that require it. Bitcoin has been developed with characteristics that promote its decentralization, which many of its proponents aspire to keep. Due to the blockchainâs decentralized and auditable nature, its potential for its developers and end-users to harness it for use cases that require traceability and transparency is great.
Security:
Not only are transactions encrypted they must be agreed upon and in consensus before being approved. Once approved they are linked to all of the transactions which were all previously validated in the chain. The previous transactions were also required to go through the same consensus and encryption protocols. Because the blockchainâs protocols require it to verify, encrypt, and to reach a consensus from multiple sources containing the entire ledger of the blockchain; this makes the blockchain highly secure in comparison to traditional methods of data encryption. It would be very difficult for someone to hack the blockchain because they would not only need to hack into a few machines to alter data. They would have to hack into many computers on the blockchain network and hack the blockchain ledger on the majority of the computers that contained the blockchainâs ledger. Within blockchain technology, nothing short of massive scale collusion of the network can produce occlusion.
Improved traceability:
Because a blockchainâs history can be audited, the blockchain can be beneficial for tracing the complex transactional interactions of items within a supply chain. This auditable historical data can be beneficial to a supply chainâs traceability. When all of the items in a supply chain are processed throughout their lifecycles on a blockchain, and all of those items in that supply chain have their interactions and transactional data recorded by the blockchain; then all of those items and their interactions within the supply chain can be historically traced throughout their lifecycle. This auditable historical transactional data recorded by the blockchain has the potential to make it easier to trace the often complex historical journeys of items within a supply chain. Also, transactions are verifiable on the blockchain therefore all of those items within that supply chain can be validated and verified for authenticity.
Increased efficiency and speed:
Using blockchain technology can automate aspects of some of the processes involved in settling transactions and can streamline components of the steps involved in the settlement of transactions between parties. Settlement can be reached more quickly when operations in the steps to settlement are automated within the blockchainâs protocols. This can reduce human errors such as the errors that may occur when multiple parties are required to reconcile multiple ledgers or when intermediaries are used throughout the processes of contractual business operations. Time may be saved when the blockchainâs protocols are leveraged to simplify and programmatically automate what may traditionally have been complex contractual business interactions in which the confirmation that specific events have transpired are required to move forward with operations or before settlements can be reached.
Reduced costs:
On the blockchain, there is no need for each party involved in a transaction to trust that what each other say is true before settling a transaction.
This is because the transactional data stored on Itâs cryptographically secured blockchain ledger is trustless. The transactions committed to the blockchain ledger have already been verified and validated by the blockchain. When participants are no longer required to trust that what each other say is true, this speeds up operations by speeding up the process of deliberation when settling transactions.
By removing the requirement to trust those involved in a transaction and by using the blockchainâs protocols to programmatically automate the settlement of transactions; one may potentially reduce costs by increasing efficiencies and reducing the time & effort required to conventionally validate and settle trades, transactions, or contracts between parties. Also, as previously mentioned, when participants have permissioned access to one immutable version of data that they both trust then they are no longer required to trust any other parties to process their transactions. When all parties can simply rely on the protocols and the data on the blockchain, they should no longer require or incur the same costs associated with third-party middlemen that are sometimes used to confirm, guarantee or make agreements before settling upon transactions and contracts.
This all can add up to significantly reduced costs when making many types of transactions on the blockchain which means that participants trading, doing business, and making all sorts of transactions on the blockchain may be able to proceed much more quickly and smoothly when compared to some traditional methods because settlements, transactions and all sorts of contracts can be automated, validated, secured, and settled with comparative ease.
Transparency:
The transaction history of a blockchain is immutable and verifiable by anyone with access.
Security:
Transactions must be agreed upon by multiple actors (consensus) before entering the ledger, then they are encrypted and linked to the previous transaction. Each additional transaction secures the ledger further as it becomes exponentially more difficult to change an earlier transaction as more and more are chained together in this way.
Improved traceability:
The historical transaction data leaves a clear audit trail from beginning to end.
Increased efficiency and speed:
When all record keeping is kept in one place (the blockchain) you do not have reconcile multiple information silos (traditional databases) and it becomes easier for parties to âtrustâ the each other because of the immutable nature of blockchain.
Reduced cost:
Third parties and middlemen are often no longer required because you do not need to trust your trading partners. Costs can also be reduced because all of the required documentation of transactions exists on the transparent, immutable ledger.
Hi,
1, Imagine the whole world uses blockchain for companies, politicians, and people- the whole financial system would be very transparent. It would be difficult to do scams, fraud or bribery.
2, Blockchain technology is extremely hard to breach- first it verifies if transactions make sense, then itâs encrypted and added to the block. Even the slightest change in any previous transactions would change the whole blockchain which would result in the need to re-mine all blocks after this transaction.
The whole system is decentralized- there is no single point of failure except the internet/electricity - net or electricity need to fail for all miners and nodes (the whole world).
3, Because all transactions are publick- everyone can check and trace them.
4, Because the whole system is not based on banks or some central power- the system is very fast and cheap. I can send money through crypto to the other side of world in a matter of seconds. But with FIAT it can take even a week. Also, I donât need to pay fees to banks (my pay will go through several of them). The guy on the other side of the world can check in real-time how my transaction to him is going.
5, Accounting and transactions are on the same layer. Audits can be done automatically and in real-time.
There is no need for contracts between partners or need for 3rd party- because transactions are visible to all, immutable and in the blockchain of Eth type it can be programmed to do very specific think- like you will get your payment only after I confirm that I received service/goods ordered. And because service/goods can be tracked in blockchain too then you donât need to trust me that ill not lie or scam you.
Transparency in real life is rare, so lets transfer it to digitised mathematical formula. Every person or node has the same version of an online distributed ledger, each node must agree with any change that takes place. The ledger itself allows public access, the mathematical formula governing the ledger has public access.
Security is therefore improved, once additional data is added or changes made it is encrypted and connected to all parts/nodes of the ledger. Means hackers have a hard time, they have no single point of attack.
Security is also vastly increased by improved traceability. Every point of a objects journey and every point of exchange, be it digitised information or a physical commodity, can be recorded on the blockchain, providing an unchangeable audit trail.
A highly secure real time audit trail can be provided available to all participants at any one time in the form of a single digital ledger. This requires far less third party mediation and far quicker verification/confirmation. Resulting in increased efficiency and speed.
As a result of increased efficiency and speed and the need for far less third party verification costs are much reduced
Transparency: Transparency is necessary and built in. All participants share the same documentation and they must agree with each other, if this is to be changed.
Security: Information is stored across a network of computer, making an attack more difficult. New transaction must be agreed on and verified by the network before it is linked to earlier transactions.
Improved traceability: Blockchain allows for following an audit trail in complex supply chains where all the inputs and outputs at the difference steps in the chain can be verified and traced.
Increased efficiency and speed: One ledger is used instead of many. This means less clutter and higher speed and efficiency.
Reduced cost: Third parties and middlemen are to a large degree superfluous and not needed. Elimination of layers in the the chain means reduced cost.
Transparency: Everything on the ledger is there to see for all. It has been agreed upon by consensus and then recorded. You do not have to trust any one person, authority or organization, it is decentralized.
Security: The security is managed by the entire network. There is no one service, system, person, authority or organization responsible for it, so it is in everyoneâs best interests for it to be correct and immutable.
Improved traceability: Any digital data that is put on to the blockchain can be tracked from itâs origins and followed through until its end point. It cannot be deleted, changed, or manipulated.
Increased efficiency and speed: The blockchain is the one and only intermediary that facilitates peer to peer transactions without the hold ups of third parties.
Reduced cost: With the blockchain as the only intermediary, there is very little costs involved. Data or funds donât have to go through several sets of hands (with all doing it for a price) to get from point A to point B, making it very fast.
- Transparency
In blockchain the entire ledger is shared and distributed to all the nodes in the network, all additions to the ledger need to be agreed on through consensus.
- Security
Blockchain utilises consensus, encryption and a decentralised network of computers to enhance its security.
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Improved Tractability
Every step in the supply chain can be recorded on the blockchain. Making for an easily traceable supply chain which can help prevent fraud and make for easier call backs etc. -
Increased efficiency and speed
The shared ledger makes for a much faster clearing and settlement. -
Reduced Cost
Less documentation and no need to rely on middlemen leads to a reduction in cost.
Transparency: All participants on the network share the same documentation. Changes can only be made through consensus which means everyone must agree on it, which can be very difficult.
Security: All transaction must be agreed upon before it is recorded on the blockchain. Information is stored across a network of computers making it difficult for hackers to compromise data helping to prevent fraud.
Improved traceability: Transactions recorded on the blockchain can be traced from its origin to its final destination. This helps to verify authenticity and prevent fraud.
Increased efficiency and speed: Blockchain helps to eliminate human errors and streamlines transactions which are shared by all participants on the network. You donât have to reconcile multiple ledgers causing less clutter and itâs easier to trust each other.
Reduced cost: Reducing cost is a priority. You eliminate third parties and mediation. You just have to trust the data on the blockchain. All participants have access to an immutable version on the ledger.
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Transparency: Everyone shares a data base that cannot be altered with, you can only add to it. This allows everyone to find a common truth by seeing everyone elses data and being able to imediatly call out false data since everything is visible and everyone has a copy of the blockchain.
Security: Since the data is shared with everyone, one could not alter the facts/data without other people being able to see it. Since everyone has a copy of the same data.
Improved traceability: Because every transaction is saved permanently, so one has the ability to go back and see every transaction if need be.
Increased efficency and speed: Since everyone can go directly to the same data base there is not as much need for building thrust and lenghty/costly procceses to analyse that every transaction is correct. The truth is in the pudding (math) and EVERYONE can see it.
Reduced cost: When everything is in one shared database you can fully thrust the system and donât need to spend money on getting acces and inspecting transactions/data from third parties to see if they are legit since the information can be found in the blockchain at anypoint.
- Transparency: All network participants have access to the same information instead of individual copies that can be manipulated.
- Security: Each transaction is linked to the previous transaction that has been agreed upon along with being linked to multiple servers instead of one centrally located server. everyone must agree on the transaction before it is recorded.
- Improved traceability: With blockchain you are able to trace the origin of where goods came from for example and how each transaction is linked to the one before and agreed upon by everyone.
- Increased efficiency and speed: With automation of the blockchain processes transactions are completed fast and more efficient
- Reduced cost: Not as big of if any need of third parties. One can rely on the data from the blockchain being accurate.
Transparency: any user at any time of the blockchain network can check and validate an information within
Security: all transactions are recorded in the network, each transaction is linked to previous block, cannot be amended/manipulated
Improved traceability: any transaction can be validated on blockchain without use of any 3rd party companies, quick, cheap, reliable
Increased efficiency and speed: no 3rd party included on transaction therefore is faster and more efficcient
Reduced cost: as its a blockchain ledger - you cut off the 3rd parties for audits/accounting etc making the cost less
Transparency: All network participants have access to the same documentation.
Security: Every transaction must be agreed upon, because it is held in a network of computers and not a single server the data cannot be altered.
Improved Traceability: There is an audit trail for every transaction with every stop its made.
Increased Efficiency and Speed: Transactions are faster and more efficient when everyone has access to the same information. Traditional paper is prone to human mistakes and third party involvement is needed.
Reduced Cost: The only trust you need is with the math within blockchain, no middle man is needed therefore fewer costs.
Transparency: the very structure and nature blockchain has determine that every transaction (or exchange of information) that is registered and validated on it becomes accessible to every other member of the network. This makes it possible for everyone to analyze it and question its validity, but it also prevent it from being modified over time, leading it to become a transparent and immutable database.
Security: Consensus mechanisms, encryption, decentralization and every other technological feature on which blockchain relies when it comes to security determine that every activity performed on (and through) the blockchain is based on a substantial security level that cannot fail its members. This makes it possible to use this technology without fearing potential issues and risks in terms of its safety.
Improved traceability: This is another benefit that blockchain brings to its users, as it becomes possible to register and keep track of all the steps that led to a specific outcom at a certain time. It allows members to be able to verify the integrity of every step in the process, leading to more traceable and verifiable activities.
Increased efficiency and speed: since every information is accessible and verifiable by any member of the network, anything that happens on the network itself is quickly and easily certified as either valid or not. This makes it possible to improve both efficiency and speed as the time needed to make transactions (no matter the type of information) and validate them is reduced, as well as the time to check on their validity at any given time.
Reduced cost: For all the reasons explained above, Blockchain technology is basically a more transparent, safer, more traceable, more efficient and faster method to perform many tasks that businesses (or entities of any given kind) need to complete. This makes it more efficient (given the proper circumstances) and thus less costly.
Transparency is a benefit of using block chain because it allows data to be accurate and consistent since it can be verified by anyone who is authorized to view the data. Transparency also leads to greater security because while the entire block chain is visible, to anyone that is authorized, there isnât a way to change the information on it without consensus from the entire network. Blockchain is also more secure by requiring that all transactions be confirmed before being added to the blockchain. Also once a transaction is added to the blockchain it is linked to the previous transaction and stored on every computer in the network. This makes hacking very difficult. This practice of building a blockchain not only makes hacking difficult but also allows for improved traceability. Since every transaction is linked to previous transactions you end up with a complete audit of where a product or asset originated and anywhere it stopped along the way. With this audit we are then able to tell if the product or asset we have is authentic or valid. Blockchain also increases efficiency and speed while reducing costs. It does this by having everyone using a single ledger that is shared and stored by everyone participating. With everyone always having an accurate up to date ledger of every transaction, these transactions become faster, more efficient, and cheaper than traditional processes. There is no longer a need for intermediaries or reconciliation, both of these are costly to the user and create room for mistakes.
Benefits Of Using Blockchain
- Transparency
- All participants share the same documentation
- The Ledger can only updated through concensus
- Changing a single transaction requires altering all subsequent records and collusion of the entire
network. - A blockchain is more accurate, and consistant, making it more transparent
- The information is available to all permissioned users.
- Security
- All transactions must be agreed upon before they are recorded
- Once approved, a transaction is encrypted and link to the previous transaction and its stored on a
network of computers. This makes it incredibly difficult for hackers, or dishonest parties to
compromise data. - A network of nodes verifying the ledger can prevent fraud and unauthorized activity
- Improved Traceability
- When exchanges of goods are recorded on blockchain, an audit trail shows where an asset came
from, and every stop it makes. - Transaction data can verify authenticity and prevent fraud
- Increased Efficiency and Speed
- Streamlining and automating trading processes makes transactions faster and more efficient
- Automatic functions help prevent human error
- Uses a single shared ledger, rather than reconciling multiple ledgers from different parties.
- The single shared ledger is easier to trust
- Clearing and settling payments is much quicker
- Reduced Costs
- There are fewer middlemen and third party actors required to make guarantees
- Everyone can trust the data on the blockchain
- There is less documentation to review
Transparency on the blockchain is seen by all parties and stays there forever
Security is managed by the transactions being recorded on the blockchain and linked to the previous block cryptographically.
Improved traceability through the advantage of the blocks of transactions linked to the previous block.
Increased effeciency and speed through the completion of transactions on the blockchain quicker and visible to all in that particular community.
Reduced costs, as trust is no longer an issue and no third or counter party taking there cut leaves the blockchain technology far superior to any.