Trust of Blockchain

Blockchain enhances trust across a business network through the following five attributes:

 Distributed: The distributed ledger is shared and updated with every incoming transaction
among the nodes connected to the Blockchain. All this is done in real-time as there is no
central server controlling the data.
 Secure:Every transaction is signed by end-user, which allows for the verification using public
key and trusted certificate of the end user
 Transparent: Because every node or participant in Blockchain has a copy of the Blockchain
data, they have access to all transaction data or data of their interest. They themselves can
verify the identities without the need for mediators.
 Consensus-based: All relevant network participants must agree that a transaction is valid.
This is achieved through the use of consensus algorithms.
 Flexible: Smart Contracts which are executed based on certain conditions can be written into
the platform. Blockchain Network can evolve in pace with business processes.

How does blockchain technology works ?

The following are three principal technologies that combine to create a blockchain.

 Public Key cryptography and Hash Algorithms

 A distributed network with a shared ledger and
 An incentive to service the network's transactions, record-keeping and security.

The main purpose of this component of block-chain technology is to create a secure digital identity
reference. Identity is based on possession of a combination of private and public cryptographic keys.
The combination of these keys can be seen as a dexterous form of consent, creating an extremely
useful digital signature. In turn, this digital signature provides strong control of ownership.

Identity
Strong control of ownership is not enough to secure digital relationships. While authentication is
solved, it must be combined with a means of approving transactions and permissions
(authorization).Forblock-chains, this begins with a distributed network.

Distributed Network
Block-chain, is a growing list of records, called blocks, which are linked using cryptography. A
blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for
inter-node communication and validating new blocks.

System of record
When cryptographic keys are combined with this network, a super useful form of digital interactions
emerges. The process begins with A taking their private key, making an announcement of some sort
- in the case of bitcoin, that you are sending a some of the cryptocurrency - and attach it to B's public
key.

Protocol
A block - containing a digital signature, timestamp and relevant information - is then broadcast to all
nodes in the network.

Network servicing protocol It is "an open, distributed ledger that can record transactions between
two parties efficiently and in a verifiable and permanent way". For use as a distributed ledger, a
block chain is typically managed by a peer-to-peer network collectively adhering to a protocol for
inter-node communication and validating new blocks.

Transaction flow through blockchain Each owner transfers the coin to the next by digitally signing
a hash of the previous transaction and the public key of the next owner and adding these to the end
of the coin. A payee can verify the signatures to verify the chain of ownership.