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The blockchain is a technology that enables secure, non-manipulable transactions in the network and is therefore also interesting in isolation from Bitcoin. The aim is to create transparency along the entire food supply chain, from the producer to the processor, trader, retailer and consumer. All parties involved are permanently provided with a common data set with access rights and up-to-date information on the food system. 

What are the advantages and disadvantages of block chain?

The decentralization of IT in general and block chain in particular has some advantages and disadvantages. Some of the advantages are
  • Based on the Distributed Ledger (general ledger), each transaction is securely documented and transparent for all parties involved. Updates are only possible if everyone agrees. Data stored in a block chain is therefore accurate, transparent and consistent. They can be accessed by all authorized persons. The modification of a single transaction record would require the modification of all subsequent records and the approval of the entire network.
  • Security is a major advantage of the block chain. Transactions must be agreed upon by all parties before they are recorded. Once the approval process is complete, the transaction is encrypted and linked to the previous transaction. Because the information for this is not located on a single server but in a network of computers, it is virtually impossible for hackers to compromise transaction data. This makes the block chain theoretically suitable for all scenarios in which different parties exchange critical information - i.e. not only for food producers, but also for banks, logistics companies, public authorities or even health care companies.
  • One argument in favor of the block chain is the traceability and thus also the authenticity check of products. An insight into historical transaction data can help to verify the authenticity of products and assets and prevent fraud. Companies can therefore not only detect weak points in branched supply chains, but also trace articles back to their origin and producers. This can go so far that consumers know which farmer harvested their mango and when.
  • The block chain enables more speed in traditional business transactions. Anyone who uses paper or e-mail-based processes knows about the duration and error-proneness of complex transactions involving many parties. Errors often result in lengthy mediations or legal proceedings. A "centralized digital accounting", as made possible by digital ledger technology, ensures less frictional loss and disorder. It becomes easier to trust each other, so that clearing and settlement can take place more quickly.
  • In fact, a significant reduction in costs for administration and internal and external financial transactions and reporting is also expected. Those who rely on the block chain do not need so many third parties or other entities to provide guarantees. Trust in the trading partner no longer plays a role, one can fully rely on the data of the block chain.
The disadvantages are as follows
  • With each block the block chain grows and with it the memory requirements. If data in the terabyte range were to accumulate, it would have to be stored on every node in the network, which is hardly realistic, especially since the Internet connection would be extremely heavily loaded. It is therefore necessary to play through exactly which transaction scenarios can be mapped and which cannot.
  • Blockchain technology is not easy to integrate into existing IT landscapes, especially when many legacy applications are running. This is why it is a real challenge for IT departments.
  • What happens if there is no agreement among the peers and some reject a software update while others support it? In extreme cases, the block chain splits and two independent new block chains with the same history are created.
  • The block chain is also not 100% tamper-proof. If a participant manages to control more than half of the participant nodes (which de facto never happens), he can theoretically change the transaction history.
  • The performance of a block chain is not even remotely close to that of a central database. The verification of transactions and their synchronization take time. Furthermore, transactions in the network must be processed independently by each node.

Why can industries benefit from the blockchain?

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The decentralization of communication already began with the Internet, each person was given more control over the information they consume. In the next step, in addition to communication, computing power and storage will also be decentralized (cloud computing), and with the block chain a further element is now being added. The block chain fires up ideas to control not only crypto currencies such as Bitcoin via decentralized networks, but also other digital content such as art, music, texts or photos. We have compiled the first concrete practical examples of the use of block chains in various industries in the article "Blockchain in use".

What do the block chain offers of the large IT groups look like?

Irrespective of the above examples, it can be stated that large IT groups are jumping on the blockchain train and working on software and service ecosystems around the technology. Thus, within its cloud offers developers the opportunity to set up their own block chains. For this purpose, it provides the hyperledger code on which the Bitcoin block chain is based. Through the simultaneous integration of the container service, it is "now possible for developers to get their own mini-blockchain up and running within a sandbox in twelve seconds," as underlined by Bitcoin, which is responsible for the blockchain offerings, when the services were presented in February 2020. "And just one minute later the first complete block chain application is live." She, too, has long since recognized the benefits and launched the project in the cloud under the umbrella of "Ethereum Blockchain as a Service". In the near future, various middleware tools are to be launched to extend the business benefits of Blockchain. For example, "Blockchain as a Service" primarily addresses developers. The technical tools used in the solutions are so-called "block chains", which allow users to enter external data into a block chain without destroying its security and integrity. These cryptlets can be developed in any programming language and run within a secure container, similar to the IBM offering. He sees the benefit of the block chain technology especially in security-relevant topics such as identity management and encryption and has already integrated corresponding services in Project.

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