The groundbreaking database technology Blockchain overcomes the limits of the financial industry. Prevent recipe fraud, recharge e-cars, even marry – everything is now possible via Blockchain.
The Blockchain is a novel technique for storing data and allows the secure management of information of any kind. The Blockchain originated in the Internet currency Bitcoin, where the monetary value can be transferred without central bank instance. Elementary constituents of the blockchain are the transactions. Two parties exchange information with each other. Subsequently, the data is verified and validated, verifying whether a party has the appropriate rights for these transactions. This is followed by the mining (German: digging), in which after a certain time the transactions are combined into blocks and a hash value is formed above. Thereafter, the blocks are appended to the chain and via a peer-to-peer network distributed.
The blockchain technology can be considered absolutely tamper-proof because the blocks are hashed and copies of the file are distributed on the Internet. If you want to manipulate the content of the blockchain you would have to change at least 51 percent of the copies. This would involve such high costs that the manipulation of such a database is completely uneconomical.
The best-known and most promising application of blockchains are the Smart Contracts(German: intelligent contracts). Smart contracts are a new form of contract. These are web-based computer protocols that depict contracts and technically support the execution of a contract. These computer algorithms determine which conditions lead to which decision. It is advantageous in this automated processing of contracts that no lawyers or lawyers are needed when writing or executing. For example, these algorithms could monitor contracts in real time and automatically enforce the rights of contractors. Thus, the human factor becomes a source of errorlocked out. Furthermore, the profession of bailiffs is at risk. For example, if a customer does not pay the rate for their car, access to the vehicle may be automatically disabled.
In principle, blockchain applications are capable of executing code. First blockchains implement very simple operations such as setting a token. Meanwhile, established programming languages are used to make the complex calculations of hash values, so called mining. In many cases, the code is not executed in isolation but is part of a larger application. In addition, blockchain programs differ from classic software. So the program itself is recorded by the blockchain. If the program is executed, it can not be interrupted or otherwise disturbed by anyone . This technique ensures that the content of the contracts is fully implemented.
Smart contracts are particularly useful because these contracts can involve several parties who do not trust one hundred percent. The fulfillment of the contracts is completely automatic – including their monitoring. In many contracts, clauses are intentionally included to control a contract. In traditional contracts, compliance with clauses must be manually monitored. If, for example, the person monitoring is on vacation or sick, the implementation is delayed by the corresponding time span. The use of smart contracts greatly reduces the operational risk of the parties and the process is automated and trustworthy.
What’s up with Blockchain, Bitcoin and Co.?
Another cryptocurrency based on the blockchain principle. Provides a platform for programmable smart contracts. The “ethers” are regarded by fans as a legitimate successor to the Bitcoins (see also above picture).
Microsoft Azure cloud-built service that allows users to put external data into a blockchain without destroying their security and integrity. As an individualized middleware, cryptlets can also be developed by Azure users themselves – in any programming language – and build the bridge from the blockchain to new business services in the cloud.
Digital money, without coins and bills. Cryptography builds a distributed, secure and decentralized payment system. Does not require banks, but computing power and technical aids such as the blockchain.
A blockchain is a distributed database that maintains an ever-growing list of transaction records. The database is extended chronologically linearly, similar to a chain, at the lower end constantly new elements are added (hence the term “block chain” = “block chain”). If one block is complete, the next one is created. Each block contains a checksum of the previous block.
The blockchain technical model was developed as part of the cryptocurrency Bitcoin – a web-based, decentralized, public accounting system for all Bitcoin transactions ever made.
A globally available decentralized payment system and the name of a digital monetary unit. You do not need a bank to handle Bitcoin payments – everything is done through a peer-to-peer network of computers and the blockchain as the central database.
The open source software validates the entire blockchain and was released in early 2009 by a certain “Satoshi Nakamoto” under the name “Bitcoin”. Bitcoin Core was in C ++ soon to be programmed especially for Windows systems. A little later the porting to GNU / Linux followed. Because the developers are divided, there are now some derivatives of Bitcoin software, including Bitcoin XT, Bitcoin Unlimited or Bitcoin Classic.
The “scalable blockchain database” can manage up to one million writes per second, store petabytes of data, and still have a latency of less than a second – all managed in a decentralized manner and with the highest data integrity. The technical basis is blockchain technology.
Financial term for “distributed account management”. Bitcoin is a completely new technical approach to distributing information about specific assignments. There is no longer a classic account managed centrally at a bank, but “account management” is based on a network of communicating systems.
A computer log that can depict or review contracts or provide technical support for negotiating a contract. Could in future replace the written contract.
The startup R3 CEV builds the blockchain-based “Global Fabric for Finance”. With around 50 financial partners, the largest block chain in the world to be developed – a first test run with eleven banks, including Barclays, Credit Suisse, HSBC, UBS and UniCredit has already been successfully completed. R3CEV has entered into a strategic partnership with Microsoft to develop blockchain infrastructure and technology in the Azure Cloud.
A free software with which every user can develop their own blockchain application.
An open source protocol for a payment network – currently under development. P2P payment method and foreign exchange market in one, based on the cryptocurrency “XRP”. However, ripple users are not set to this one currency, but can use any currency – including euros, dollars or yen, for example.
In June 2016, after three months of preparation, the world’s first Blockchain-based auctiontook place in Ukraine , selling state-issued licenses. The platform for technical implementation was Microsoft Azure Cloud Services . The aim of the government-led initiative is that bidders from all regions of Ukraine and abroad can participate in the auction. Due to the security aspects of Blockchain, no third party can take control of the system, resulting in a secure auction history. In addition, all transactions are transparent – there are no closed doors in these auctions, all information is publicly available and accessible to everyone, It is expected that Blockchain-based auctions will prove their worth worldwide.
Wedding ceremony by QR code
There are other interesting fields of application for blockchain technology. So it is already possible in the US to marry with Blockchain. Joyce and David Mondrus were the first couple to be married by Blockchain in October 2014. In principle, one can store any information in a blockchain, in this case it was the marriage. The ceremony was held via Skype. For the legally compliant marriage, the couple had to scan and confirm a QR code that was written directly into the Blockchain database . In this way, it is even possible to marry anonymously – that is, without knowing each other or has ever seen. Whether many couples prefer this service to a “real” wedding will be shown by the future.
Revolution in electromobility
Slock.it and RWE entered into an interesting cooperation in order to use the bitcoin version Ethereum for payment at charging stations of electric cars. With blockchain technology, companies want to create a single and cost-effective payment system that is independent of cashiers, coin slots or vandal-prone EC card slots. Behind the cooperation is the vision to revolutionize the distribution of electricity for cars – RWE, for example, introduces electric carsinduction charging while they wait at red lights. So the stationary shop in city traffic should become completely superfluous. The payment of the small amounts of money for the electricity then takes place via the cost-effective Ethereum.
“Permanent elections” for more democracy
Another keyword for the use of blockchain technology is the “Democracy 2.0” . This means that elections could take place via blockchain, also to increase general turnout. By using blockchains, governments would be able to give citizens more electoral rights. Instead of the four-year legislative period, which is valid in Germany, for example, a “permanent election system” could be set up in which parliaments are assembled in shorter periods at the will of the voters.
In addition, referendums are quick, flexible and inexpensive to carry out. Currently, the Federal Constitutional Court refuses this technique. The judge’s argument is that parties could manipulate the election with the help of vend machine manufacturers and software developers.
No more manipulated odometer readings
In the following two possible application scenarios for the Blockchain are presented, which are so far only thought games.
So is the manipulation of odometer readings in cars is a big nuisance and meets the facts of fraud in Germany. The damage adds up to around six billion euros per year. The counterfeiting of odometer stands is very easy and fast done with the appropriate technology. One approach to preventing these scams could be to write the mileage of all vehicles in a blockchain. It is conceivable that open Wi-Fi hotspotstransfer the odometer reading to the blockchain. Thus, the human factor is excluded in the transfer and he can not fake the entry. If the mileage in the car is lower than that in the database, the car was manipulated. The blockchain could end the criminal machinations of the tacho forgers forever.
Against recipe fraud
Also being cheated on a grand scale with manipulated health care billing . A big problem for the health insurance funds are so-called “air recipes”. These are prescriptions that are billed by the pharmacies, but the prescribed drugs were never sold. Most recently, the statutory health insurance found suspected air prescription frauds with a total loss of 16 million euros. The number of unreported cases is likely to be many times higher, since the fraud is very difficult to prove.
Remedy could be a blockchain. Any drug packaging that is dispensed must be clearly marked. This could be realized , for example, via a QR code . This code clearly identifies where the drug is located. This can be at the manufacturer, wholesaler, pharmacy or patient. If a drug is sold to the patient, the QR code is scanned and the drug is written as spent in the blockchain. Only when the drug is marked as spent, the pharmacy receives the money from the health insurance. The QR code may already be printed on the recipe. So the patient can be sure that he has received the right medicine.
Furthermore, the billing of medical services could be done using blockchain. Thus, the patient could be required to confirm the services provided by the doctor. Only when the performance has been confirmed by the patient and is registered in the blockchain, the health insurance company reimburses accordingly.
Conclusion: Blockchain first
The young, innovative database technology Blockchain will cause major changes in the field of IT and also in the various sectors of the economy and industry. Their biggest advantage over conventional databases is the data and manipulation security .
The use of blockchains threatens a whole range of business models. The cutback will be severe in the area of justice, since contracts can be concluded by smart contracts without the use of notaries and lawyers. Furthermore, part of the work of bailiffs will be canceled if, for example, access to unpaid goods is automatically blocked. There are also changes to be made in the real estate industry – the purchase and sale of real estate can be handled without brokers by supporting Smart Contract and save its lush commission. In the banking sector, blockchain will lead to major infrastructure slippage. Currently, it is estimated that the savings potential of the banks is 50 to 70 percent .
The future will show whether the future visions in connection with the blockchain will be fulfilled. Many applications are currently still in Alpha or Beta. It is unlikely that the “big players” such as Apple, Google, Facebook and Microsoft will be cut in their market power. It makes sense for many companies, now to deal with the blockchain, not to lose the connection to the competition.