4 advantages of Blockchain Technology outside Cryptocurrency

Blockchain is a resourceful and farsighted invention of the human. The technology is viewed to bring meaningful and significant changes in the system of finance. Its decentralized, independent and transparency features make it more reliable and easily accessible for the users. Blockchain stores all the information and the records between the parties as a distributed ledger that can be easily accessed by them at any time and any place they want. 

Many cryptocurrencies or digital currencies are already based on Blockchain technology. Apart from digital currencies, it is also in use by some industries such as business, government, and healthcare, etc. It is helping the industries in improving their techniques of working, functioning and hence in performing better. It makes the organizations and users achieve accessibility, transparency, security, better functioning, and many such things at a very minimal cost.

Let us see how Blockchain will transform the industries and organizations for their enhanced performance by changing their functionalities.

Smart Contracts

Contractual transactions are time-consuming as well as a bit risky. In addition to that, it also lacks transparency, because contracts require the third party undertaking. It requires a third party to come in between or become a mediator between the two parties when they are signing a contract. 

Smart contracts are digital or virtual contracts. It does not need a third party and can perform without them. Smart contracts control the transfer of digital currencies or assets between parties but with certain conditions. A smart contract does not only include the rules, regulations, and penalties related to an agreement just the same way a traditional contract does, but it can also automatically execute those commitments. It is transparent and also accessible to both parties. None of the party can tamper it and even if they try to then the other party will automatically get informed.

Reduced Costs

Some financial institutions that provide cross-border exchanges, charge high transaction costs. It also involves middle-men or mediator to monitor and keep a check on the operations.

With blockchain, you do not need a third person to monitor and it will not even matter that you trust the other party because there is no room for any kind of fraud with this technology. The removal of middlemen leads to a reduction in costs.

Quality Assurance  

Blockchain assures quality providing the facilities of safety and security. It is very much essential for the organizations and industries to work efficiently, without any error or mistake, to maintain and upgrade their functioning. If any fault or error is found,
Blockchain will be able to trace it from the starting and after researching, necessary steps could be taken to fix it.

Efficient Accounting

Blockchain is virtual, where all the transactions are recorded automatically. This feature of Blockchain eliminates the chances of any human error. Records automatically get verified and this is how the chances of any mistakes lessen or even gets eradicated. This way it makes the transactions and accounting more accurate and also highly traceable.  

Conclusion

Despite the fact that Blockchain was initially explored for digital currencies or digital assets, it is in use and can be used in other different sectors and industries as well.

Moving from finance to fintech : What you need to know

We are living in the 21st century where things change like seasons! The financial sector has evolved rapidly over a decade (thanks to technology) software, as well as cloud-based technology, revolutionize the way the industry operates. 

Before moving ahead let us know what Fintech really is 

Basically financial technology, aka “Fintech”, is a unique combination aiming for the traditional financial methods in the delivery of financial services.

It is one of the emerging industries that promotes technology to improve activities in finance specifically. The use of smartphones for mobile banking, investing service & even for the cryptocurrency are a few examples of such technologies.

Wondering how can you shift without much effort?

Here are the few steps which you must keep in your mind:

Recognize your transferable skills

Just like any other job in the market which demands certain skills that are also transferable across multiple disciplines, moving from finance to Fintech is also similar. 

The 1st step in order to do that is to look at the skills you developed in a couple of years which are needed by Fintech firms.

 Although it might be true that coding, data analysis is like the bread & butter of Fintech, nonetheless there is still a need for more traditional skills in order to survive in this industry.

Understand thy expectations

Now since you know the skills which you can actually offer, it is crucial to analyze landscapes to see what practical prospects with them really are. 

For example, choosing between a role where you can work on a particular task all day long or working on more generalist role for business are 2 different things.

Having the skills for former won’t have any kind of shortage of jobs, except for the fact that you might be competing against some of the top programmers out there. 

On the other hand, opting for latter & also getting involved with a Fintech start-up is a great way to bring fresh insight into the business.

Know how to sell yourself

Once you get a good understanding of what your goals are & also what you can provide, you can combine them accordingly. 

Plenty of the Fintech companies would jump at the opportunity to hire a financial professional with loads of experience & qualifications, irrespective of their technical knowledge. 

Network and retrain

Whenever it comes to switching jobs or industries getting help from others is always favorable. You must have got a large network of colleagues, clients, industry friends that you’ve built up over the years, use them. Look for folks who have made a similar switch and succeeded. In case Fintech hasn’t affected your career already, it soon will. 

CONCLUSION 

Moving to a new place is a tough task and requires lots of guts for it. But when you know what your destiny is and how you are going to reach there, nothing seems to feel like a hindrance.

Top 5 Myths Surrounding Blockchain

Blockchain Technology has increasingly gained importance over the past years. From disrupting the working of industries to changing the way we live our day-to-day life, this technology has seeped into everything. This transformative technology is seen by many as the ultimate solution to all our modern-day problems. 

No wonder, people refer to blockchain as the genie of the 21st Century. However, with this blockchain has developed a mystical aura. It is surrounded by both believers and skeptics. These skeptics have spread a number of myths about blockchain. These blockchain myths have spread around the globe. 

But before going further, let us understand what is blockchain:

Blockchain technology is a distributed ledger that offers a way of recording transactions or any other kind of digital interaction. It stores and records everything in a secure, transparent and efficient way. The blocks in a blockchain are made up of pieces of information that are entirely digital in nature. These blocks secure the information with the help of cryptography which is almost impossible to break. 

To give you an insight into this emerging technology, here are the top 5 myths about Blockchain technology that you should be aware of:

  • Blockchain and Bitcoin are the same: The popularity of Bitcoin has overshadowed the stage for Blockchain. This has spread the confusion that both blockchain and bitcoin are the same. Blockchain is the technology that provides an open and distributed ledger that records everything in a transparent method. On the other hand, Bitcoin is a cryptocurrency that was built on Blockchain. Hence, blockchain can exist without bitcoin and it has disrupted a number of industries. However, Bitcoin or any other cryptocurrency cannot exist without blockchain. 
  • Blockchain can only be used in the world of finance: No doubt, the first sector blockchain stepped in was finance. With the birth of cryptocurrency, the financial world witnessed a wave of change. However, the technology itself has transformed a number of industries. Today, blockchain has found its utilization in a number of fields like healthcare, real estate, etc. Furthermore, it has also transformed the working of governments. 
  • There is only one type of Blockchain: In today’s tech-powered world, there are majorly three types of blockchains: 
  • Public Blockchain: In this kind of Blockchain, anyone can read and write on the blockchain
  • Private Blockchain: Here there is one in charge who manages and regulates the blockchain. Hence, it is not open to everyone to see and edit. 
  • Consortium Blockchain: In this type of blockchain, there is one in charge with a group of people or a company which together makes a decision which best suits the blockchain. 
  • Cryptocurrencies are volatile hence, blockchain is also unreliable: This myth was spread due to blockchain’s initial association with cryptocurrency. However, blockchain has a number of other applications except for bitcoin and cryptocurrency. Hence, one must not associate the reliability of blockchain with cryptocurrency. 
  • The information present on the blockchain is not publically available: One of the most common misconceptions surrounding this technology is that it is completely secretive. In contrast, most blockchains are public and traceable. 

Like any other innovation taking shape in this world, blockchain has a number of initial misconceptions and myths. However, with time, these misconceptions will find their way out and turn the skeptics of the technology into its believers.

Understanding the Types of Blockchains

The term Blockchain does not need any introduction now as you must be aware of this term by now. But if you are new then let us give you a short introduction. Blockchain is an open distributed ledger that records each and every transaction between two parties. Many industries have started using blockchain and enjoying its advantages. In sectors such as government, education, medical and real estate, this technology is providing transparency, security, accountability and improving the industries’ efficiency and functioning.

Now let us see the different types of Blockchain.

Types of Blockchain

Depending on the need and use of the application, Blockchain can be divided into 3 types:

  • Public Blockchains
  • Private Blockchains
  • Consortium Blockchains

Public Blockchains:

Public Blockchain, as the name says, is accessible to the public and has no restrictions on who can participate. No one has complete control over the network in Public blockchains. Anyone can participate in reading, writing or auditing the blockchain. This helps in immutability and ensuring data security as a single person cannot exploit the blockchain. This allows users from around the world to interact with the blockchain and perform or see transactions until they are connected with the blockchain network. 

The authority and power on the blockchain are equally divided among each node in the network. This makes the Public blockchains fully distributed. Also, this blockchain is open and transparent so anyone can see anything at any point of time. Such blockchains bring anonymity which provides privacy to its users. Cryptocurrencies like Bitcoin, Litecoin, and Ethereum mainly use Public Blockchains.

On Bitcoin and Litecoin blockchain networks anyone can perform the following things that make it truly public blockchain:

  • Can run Bitcoin or Litecoin full node and start mining.
  • Can make transactions Bitcoin or Litecoin on the chain.
  • Can review or audit the blockchain.

Private Blockchains:

As the word says, Private Blockchain is kept private within the group and access is given on permission. The private blockchain functions like a private property of an individual or an organization as it performs particular job functions specified by them. In private blockchain, there is an in-charge who looks after the communication within the network. Anyone cannot join the private blockchain network unless he/she has permission. 

The participants are invited from the network administrators’ side to conduct validations and perform transactions. The person will have the responsibility for giving access to read or write within the network. It is best for companies that are interested in conducting their particular functions under blockchain technology. Private Blockchains are mainly used in private organizations for storing sensitive data and information that is available only to certain people in the organization. As it is Private Blockchain, the data is within the organization and no external entities can access it. 

In this type of blockchain:

  • Anyone cannot run a full node and start mining.
  • Anyone cannot make transactions on the chain.
  • Anyone cannot review/audit the blockchain.

Consortium Blockchains:

Consortium blockchain has mixed properties and features of public and private blockchain networks. Consortium blockchain can be classified as partly public and partly private. It is public as the Blockchain is being shared by different nodes in the network and it is private as the nodes that can access the Blockchain are restricted. So, it is a hybrid of public and private blockchain.

Under the consortium network, the authority is semi-decentralized and not staying to a single authority. A consortium blockchain is working under a group and is responsible to implement restrictions on users’ reading, writing and auditing rights. This type of Blockchain can be used when organizations or companies are ready to share the Blockchain but restrict data access to themselves and keep it secure from public access. It is mainly used in the banking sector for its fast speed, better transaction privacies, and supreme scalability. 

In such type of blockchain:

  • Members of the consortium can run a full node and start mining.
  • Members of the consortium can make transactions/decisions on the chain.
  • Members of the consortium can review/audit the blockchain.

Each type of Blockchain provides different types of characteristics that benefit industries and organizations in large. When privacy and control is required, private and consortium blockchain will be a good option and when openness and censorship is required, public blockchain will be best. Depending on various use cases, one can choose the type of blockchain network.

Public key vs Private Key

The Public key and Private key are the cryptographic keys that are used to lock and unlock cryptographic functions including authentication, authorization, and encryption. Cryptographic keys are divided on the basis of the functions they perform, what properties it has and how it will be used. Like, a key might have one of the properties of Symmetric, Public or Private.

The keys can basically be grouped into two broad categories, symmetric (private or secret) key, and asymmetric (public) key. 

In Private key cryptography, users share a secret key among themselves which is used to encrypt and decrypt messages. The basic difficulty lies in securely distributing the secret key as the complexity and size of the network rises.

Public key cryptography includes the use of the pair of a public and private key. The user is free to distribute the public key but must always keep the private key secret. 

Private Key:

Private Key is used for encryption and decryption. It is symmetric as it is the only key that is shared with another party to decrypt the ciphertext or encrypted text. It is faster than public-key cryptography.

Public Key:

Two keys are used in the Public key. One key is used to encrypt and the other key is used to decrypt the ciphertext. The key used for encrypting the plain text to ciphertext or encrypted text is the Public Key. The key used by the receiver for decrypting ciphertext to read the message is the Private Key.

Let’s understand this with an example if Jack wants to send sensitive data to Jenny and also he wants to be sure that the data is able to be read by Jenny only. Here, he will encrypt the data with Jenny’s Public Key. Now, only Jenny has access to her corresponding Private Key. So, as a result, Jenny will be the only person with the capability of decrypting the encrypted data back to its original form.

Differences:

1.Symmetric and Asymmetric

  • The private key is symmetrical as there is only one key which is the secret key.
  • The public key is asymmetrical because there are two types of keys- a private key and a public key.

2.Secrecy

  • In Private key Cryptography, the key is kept secret.
  • In Public key Cryptography, one of the two keys is kept secret.

3.Speed

  • Private key is faster than the public key.
  • Public key is slower than the private key.

4.Encryption and Decryption

  • In Private key, the same key is used to encrypt and decrypt the messages.
  • In Public key, two keys are used- one key (public key) is used for encryption and another key (private key) is used for decryption.

5.Privacy

  • In private key Cryptography, the key is private.
  • In Public key Cryptography, public key is public and private key is private.

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Public Key is made available to everyone by a publicly accessible repository or directory. On the other hand, the Private Key remains confidential to its respective owner. As the key pair is mathematically linked, whatever is encrypted with a Public Key will only be decrypted by its corresponding Private Key and vice versa.

Hence, we can say that both the keys play an important role in the security of any data, especially in Blockchain transactions.

Blockchain and Bitcoin: The Root and The Tree

Every digital information must be recorded as well as distributed, this was the aim when blockchain was invented. This might be difficult to grasp in the first place. So let us discover and understand how the first application of blockchain technology actually started.

THE BACK STORY:

Stuart Haber and W. Scott Stornetta sketched the blockchain technology back in 1991 for the very first time for the implementation of timestamps without alterations. 

It was just 2 decades later when blockchain showcased its real-world application- BITCOIN in Jan 2009.

WORKING:

The protocol which Bitcoin used was built on Blockchain. Pseudonym creator of Bitcoin SATOSHI NAKAMOTO introduced it as “a new electronic cash system that’s fully peer-to-peer, with no trusted third party”, in the white paper published by him.

Unlike fiat currencies which are regulated and authenticated by a central authority, usually a bank or government, the cryptocurrencies (like BItcoin in this scenario) are regulated and authenticated by a network of computers called Nodes.

Each time a person spends his/her Bitcoin to buy a commodity the computers on that Bitcoin network authenticate his/her transaction. At that time the user runs a program in order to solve a mathematical problem known as a hash to get his/her transaction verified on the Bitcoin network.

As soon as the hash problem gets solved, the algorithm simultaneously authenticates the block’s transactions. After that, the transaction is recorded publicly and stored as a block on the blockchain. Once recorded on the blockchain, the transactions are unalterable.

The miners who work to mine the hash, get rewarded with cryptocurrency for successful validation. 

It is important to note that all the transaction details are publicly recorded on the blockchain but the user information is not. To conduct transactions on the bitcoin network, one uses “wallets”. The details of the owner of the wallet are not stored on the blockchain. To access this wallet, one needs to have its public and private keys. 

To learn more about Public Kry and Private Key, stay tuned for our next Blog, Public Key VS Private Key. 

BLOCKCHAIN IN A NUTSHELL 

Blockchain is basically an open secure ledger that helps in transactions between peers.

This makes Bitcoin’s blockchain as Bitcoin’s ledger. Today Blockchain has evolved and is efficient enough to cater even the smallest transactions across varied industries.

BITCOIN IN A NUTSHELL

Bitcoin is a cryptocurrency which was basically derived from the Blockchain technology.  The main purpose of its invention was to boost cross border transactions and to decrease the governments’ control over the transactions thereby simplifying the entire process, without any type of involvement from the 3rd party intermediaries. 

Although it is not formally accepted yet people across the planet are using it willingly for several kinds of transactions. The fact that unlike fiat currency it’s not tangible makes it intriguing.

Both Blockchain and Bitcoin are interrelated terms. While Blockchain is the technology behind Bitcoin, Bitcoin in itself is just one of the several things that blockchain can do. 

Let us take a few minutes to understand the key difference between Blockchain and Bitcoin:

  • Adaptability is one of the key differences between Blockchain and Bitcoin. While looking at Bitcoin one see something that is rigid and just focuses on cross border transactions. Whereas a Blockchain has evolved itself with improvement over the years and is now catering to a hoard of industries not limited to the financial sector. 
  • Bitcoin is used for cross border transactions and to decrease the charges as well as the time of that transaction. While Blockchain works as a distributed ledger that allows peer to peer transactions in a safe environment. Blockchain also makes the transactions public and promoted transparency. 

Blockchain And Bitcoin – Final Thoughts

Both bitcoin and blockchain have their own strengths. While Blockchain is the technology Bitcoin is based on; Bitcoin is the first and key element derived from a blockchain. In this digital age, it is certain that more and more people looking to get the advantage of bitcoin and blockchain. 

Bitcoin and other altcoins like Ethereum, Feelium, Litecoin, etc. are gaining prominence in cross-border transactions. But blockchain technology has more applications in different sectors like Banking, Cybersecurity, Music Industry and more

Use of Smart Contracts for Revenue Sharing

Blockchain technology has proven to be one of the most innovative inventions till date. Blockchain is the technology behind the creation of Cryptocurrency. The banking and finance industry has been benefiting a lot from this technology. Especially when it comes to the use of blockchain Smart Contracts, this technology is becoming very useful. Blockchain acts as an unbiased third party that oversees each transaction.

In simple words, revenue sharing is the distribution of profits and losses among all stakeholders of the organization. Revenue sharing has become very popular as a form of income from the internet and Using smart contracts for revenue sharing is an excellent idea.  

Revenue sharing has been in use for a long time in industries like media, entertainment, sports, hospitality, government, etc. But recently it has come into people’s knowledge because of affiliate marketing. Affiliate marketing is an online sales strategy that lets the owner of a product increase the sales by allowing others targeting the same audience, also known as affiliates, to earn a commission by recommending the product to other people. People who earn money by revenue sharing platform or affiliate marketing want to ensure that they get paid for the hard work they do.

In revenue sharing, it is sometimes difficult to accurately determine who deserves the profit-sharing. Companies have to wait for days and weeks so that they can pay someone. Speed, transparency, and accuracy are the main problems in the revenue sharing model.

How Smart Contracts can be Used in Revenue Sharing?

Blockchain Technology and Smart Contracts provide a solution to all these problems. Smart contracts are agreements created using Blockchain Technology. These are executable programs that automatically execute the payment once all the pre-agreed-upon terms and conditions are satisfied. Use of Smart contracts ensures accurate, transparent and real-time revenue sharing.

There are obviously endless possibilities for how this technology will affect online profit-sharing. Groups and companies that use smart contracts in their revenue sharing platforms will experience advanced security, along with faster payments, accurate sales reporting and a variety of other benefits.

Let’s take a look at the points on how Smart Contracts will be beneficial in Revenue Sharing.

  • Accuracy: Smart Contracts updates the data that is fully approved and updates it at the actual time it took place. This improves the accuracy of the transaction getting saved.
  • Speed: With the use of smart contracts, there is no need to wait for the fully approved transaction details. Affiliate marketing companies have to wait in order to confirm that the money has been paid and also confirm that the transaction was not fraudulent. But with the smart contract people won’t have to wait long to get paid.
  • Transparency: Smart Contracts could eliminate fraudulence from revenue sharing. Smart contracts will ensure that the part your sharing in the revenue will get deducted by itself.
  • Middlemen: Everyone wants to get fully paid for their work in affiliate marketing, which is why they don’t want the involvement of middlemen. Smart contracts are attached to the automated, decentralized ledger of the Blockchain technology. This means that there will be no third-party involvement in the ledger. With this, everything will be deeply tracked and transparent. This eliminates the middlemen from revenue sharing. 
  • Security and Programme Maintenance Cost: As we know that computer software and apps need updates very often, which is very exhausting. Some companies are looking at how smart contracts could be used for revenue sharing upgrades. Smart contracts offer more accuracy and other securities without requiring any upgrade work as the normal cybersecurity technologies do. For revenue sharing platforms, this results in more security and less maintenance time to update. This results in lower operating costs.

Revenue Sharing platform could benefit in a variety of ways from Smart Contracts. This smart technology can create livelihoods for the right people. Technology such as this helps profit-sharing and affiliate work easy and trustworthy, making it a great advantage. Smart contracts create a win-win situation for all the parties involved in the revenue sharing.

Sharding & its use in Blockchain

When we compare transactions of Visa and MasterCard with bitcoins and Etherum it is found that transactions on these coins are not fast enough for day to day transactions. That’s why the developers of blockchains and cryptocurrency are trying to improve the speed of transactions in the blockchain and Sharding is one such method.

The promise of immutable record and decentralization makes blockchain one of the extremely powerful innovative technology in recent years. The famous cryptocurrencies like Bitcoin and Ethereum are its most prominent applications. The  Fintech companies were also quick to understand the value it can offer outside cryptocurrencies. During recent months, multiple companies outside of Fintech have understood the value of the blockchain. They are working on disrupting the industry verticals they are in with the help of blockchain technology

For blockchain to be universal;  Scalability, Latency and Low Throughput issues need to be addressed. Most of the public blockchains have a very secure means of ensuring data integrity. There is no possibility of deletion or modification in existing blockchains. In a permissionless public blockchain environment, Blockchain can only be updated by the addition of a new block and any computer in the network can do so. This all can be done with the help of a consensus mechanism. 

Proof of work(POW) algorithm mechanism is the widely used consensus mechanism. Hence a miner(a combination of powerfully designed hardware, special-purpose software and their user), can add a new block that too only after solving a complex cryptographical puzzle. A miner has to complete a large number of crunching operations at high speed, in a competitive environment and the POW algorithm requires the majority of the participating nodes to approve this transaction.

In a decentralized network, no one can steal the computing power of the majority of the nodes, making stealing blockchain economically non-viable. While the entire information on every node on the blockchain and the POW consensus algorithms make blockchain very permanent and secure. The design principles also impact scalability and transaction throughput adversely. As blockchains grow with a higher number of transaction there is an increasing node on each node. The increasing nodes and their participation in transaction validation makes the transaction process really slow. 

Sharding: Solving issues of scalability, latency and transaction throughput in Blockchain

Sharding is a concept used widely in databases, to make them more efficient. A shard is a horizontal portion in a database, with each shard stored in a separate server instance. This helps divide the load and make the database more efficient. In a blockchain, each node will have only a part of the data on the blockchain but not the entire information when sharding is implemented. 

To keep the decentralization in a shard, a shard maintains information only on that shard in a shared manner. Since each node doesn’t load the information on the entire blockchain, this helps in scalability.

Now, since each node will have information of only a shard that it belongs it. It will not feasible for that node to be involved in validating the entire transaction using PoW consensus. This is where Blockchain that uses Sharding adopt PoS algorithm. PoS refers to Proof of Stake which means that the designated nodes in the network have the responsibility to validate that transaction. These designated nodes are known as ‘Stakers’ because they keep some of their crypto tokens as stake to validate the transaction. Upon the transaction validation, the Staker may earn part of full of its transaction fees. Here, the more a Staker keep at stake, the longer will be the duration and the node gets to validate a higher number of transactions. 

PoS has the following advantages over PoW:-

  • The transaction is validated by Only designated nodes and not the entire network;
  • There’s no mining, hence, expensive special-purpose hardware is not needed, besides when the energy requirements are low;
  • It’s easy to identify validators with high loyalty by identifying the ones who have staked higher crypto tokens and have a longer duration.

Hence, PoS proves more fruitful when Sharding is used in Blockchain. 

Usage & Scope of Sharding in a Blockchain

Sharding is a somewhat new concept in the blockchain. Some projects that integrated the sharding concept include Shard Coin (SHARD). Telegram Open Network(TON), a potentially important project which was in the private token sale phase, has plans of using sharding to ensure the higher speed of transactions.

Sharding’s wider adoption requires the blockchain and crypto developers to work on an important aspect. While the communication between nodes within a shard is smooth,  the inter-shard communication is currently not an easy task and requires the development of a separate protocol. To address this key requirement will potentially result in wider adaption of sharding, and in turn, will help blockchain expand its scalability and have a higher transaction throughput.

Block Size, Explained

A block is just like a cluster of transactions, where each transaction needs to be validated before it is accepted by the network.

This blog is going to show you what exactly is block size, issues that arise in the absence of block size and the solutions to resolve them. 

Curious to know more, read the complete blog below:

What is a Block and a Block Size?

A block consists of any file in which data pertaining to the most recent transactions is recorded permanently on a network.  

Whereas one can understand block size as the highest limit of information that a block can store.  These transactions are added to the blocks after getting validation from the miners. The blocks are then further added to the blockchain. 

Now it’s the Miners who actually get to choose how much of a block can they want to fill with transactions. However, if anybody tries to fill the block with information that exceeds the block size limit, it is automatically rejected by the network.

Why Block Size was created in the first place?

The intention to create the block size was to counter with the “denial-of-service attacks” on a network. In theory, if there is no block size limit, an attacker can potentially bring the system to a halt by overloading the network with information. 

The block size limits the number of transactions a blockchain network can process per second. Thus, it restricts the network’s ability to scale. When a block is filled, the network can become congested and can lead to a hike in the transaction fees.

What are the issues that arise in the absence of Block size?

Ther major issues that a network can face due to a lack of defined block size includes:-

  • A slowdown in the network
  • Higher transactions fees

A slowdown in the network:  The lack of a defined Block Size can cause a slow down in the network. It could be due to the excess information that is getting added to a single block. Considering the fact that the block size remains consistent and there is an increase in the number of users transacting on the network, this will result in a slowdown of the network.

Higher transaction fees:  Ad transactions increase and reach near the block size limit, it becomes a race to get their transactions approved and on the blockchain for the users. One way to ensure this is to pay higher transaction fees. The miners get an incentive to add the higher fee transactions on priority to the blockchain. This means that the smaller transactions ones will have to wait for hours or even days to just get their transactions confirmed. 

So What Are The Solutions for these issues?

To tackle these issues of potential attacks, network slowdown, and higher transaction fees, we can consider the following solutions:-

  • Increasing the block size- One simple and obvious solution is to simply increase the block size. However, the drawback which comes along with it is that by doing so, it encourages centralization.
  • When you simply increase the limit of a block size, you also increase the cost of running a full node on the network, which not everyone can afford. This, in turn, will result in the centralization with fewer people in the network.
  • Segregated Witness (SegWit) SegWit is a Soft Fork Method, that is used to increase the capacity of a network by removing the signature data of transactions. When certain data on a block is removed, it frees up space for more data. A soft fork is just a method of upgrading the blockchain by backward compatibility. 
  • Dynamic block size– Cryptocurrencies like Monero are successfully using the dynamic block size limit. This refers to the block changing its limit as per the volume of transactions at any given time. This makes the blockchain network less prone to a slowdown. 

Concluding, we can say that, cryptocurrency space is continuously growing and scalability is an important factor to consider. To prove itself to be a potential replacement of the current financial system, cryptocurrencies need to analyze how they are scalable in the long-run.

How Blockchain Technology influences the Music Industry?

The blockchain technology has influenced and helped many sectors since its inception in 2008. This technology is extremely advanced and has no competition as of now. Hence, be it banking, healthcare or the music industry,  all sectors of the trade are trying to incorporate it. 

There are many reasons how blockchain affects the Music Industry. Some of them are listed below:-

Enhanced Security:

Piracy has grown like a virus for the past 2 decades in the music industry. It has become one of the major concerns for all creative and talented musicians, as nobody wants their hard work to be stolen or copied. Recently, the music industry in the U.S. experienced:-

  • $12.5 Billion in total output costs
  • Loss of more than 70,000 jobs
  • The decline of revenue by $2.7 Billion in sound recording and retail industry

Blockchain technology helps to enhance technology and tackle piracy. This, in turn, helps the music industry decrease its losses due to piracy.

Intellectual Property Rights:

Blockchain can be used to determine the copyright of the particular intellectual property with the help of a Distributive Ledger. A Distributed Ledger is like a record book that contains all records of transactions within a blockchain. 

Hence, claiming ownership over the particular music can be done easily and can be used in the court of law, if it comes to that. The ledger makes it easier to determine the original owner of a particular song or music. The music industry sees many legal battles related to lyrics, music and the song itself. But this can be prevented by using blockchain technology. This would stabilize the music industry and help in resolving legal battles. 

Blockchain technology can also help:

  • In resolving any issues of purchased right of music, album or label between two or more parties.
  • Music labels to pay for buying the rights to use a particular music
  • An artist can claim his rights over the music with the entire history recorded in the blockchain technology.

The use of smart contracts can also go a long way in preventing future disputes from arising. Smart Contracts are self-regulated coded agreements between two parties that are managed by a P2P network. Any parties can sign this contract without needing the tradition contracts.

Fair Pay for all parties involved:

According to a report in 2017, the artists were paid only 12% of the total revenue generated in the music industry. This has lead to an uprise in the artists for a lack of fair pay for their hard work. This is generally due to a piece of music being sold on numerous platforms and no designed way to keep a track of it. Blockchain eliminates this problem.

Using blockchain, a music label or company can keep a record of all transactions across multiple platforms. This will create a transparent platform for all the parties involved and will give a fair picture of how much a record or music made. This will enable the artists to get a fair idea of their share and how much is the cost by third parties for selling their work.

This will also provide the editors, producers, songwriters, and sound engineers and collaborators with a chance to own the property right to a part of the song or music. In case the end-product does use the work of someone, they would know about the same and get their fair share of pay accordingly. end-product

Timely Payment:

Artists are generally not paid on time and are dependent on the agencies or companies to keep them updated with the revenue being generated and their share of the payment. These tend to misuse this power and exploit the artists. But with blockchain at the forefront, the artists will be regularly updated about the revenue generation, market value and will maintain the property rights of their work. 

With artists being aware of the revenue pouring in for their work, they can ask for their fair share of payment and receive it in a timely fashion.

Eliminating Distributors:

The most prominent use of blockchain is to eliminate the third parties involved in a transaction. Just like in cryptocurrency, blockchain eliminates the banking sector, the same can be done in the music industry.  Blockchain can play an instrumental role in bringing fans and artists closer. Just like readers pay to read content in content marketing, the fans can pay a micro fee for listening to an artist’s music. 

Some music companies already using Blockchain technology are:-

  1. Mycelia: A British Musician named Imogen Heap found this company. It was established with an aim to provide fair and timely payments to the artists by using ethical and technical standards in place. By the use of blockchain, they plan to convert this in a reality.
  2. Musicoin: They use the Pay-for-Play model, where the users have to pay for the music they listen to. They are using the smart-contracts feature by Ethereum and allow users to build their own network for distribution and generating revenue.
  3. Mediacoin: With a centralized focus on security, they want to create a platform to publish music, videos, and streaming services. These are paid by in token and anyone downloading the same without it will just get an unopenable file.
  4. Ujo: Another platform that is built on Ethereum, it is working to create a transparent database that records the ownership rights of all intellectual properties involved. 

It is estimated that within the next few years, the music industry will adapt to blockchain technology. This will reshape the entire music industry and make it more transparent and secure.