Blockchain Technology Is Changing the Innovation Aspect in the Digital Economy

Blockchain Technology Is Changing the Innovation Aspect in the Digital Economy

Dmitry Davydov, Inna Pitaikina
Copyright: © 2020 |Pages: 10
DOI: 10.4018/978-1-7998-1104-6.ch006
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Abstract

In the digital era, banks are moving from their traditional methods of innovation to high-tech technologies. They have been working hard to provide a secure platform to their customers. With their continuous efforts and hard work, the concept of Blockchain technology came into notice. Blockchain technology is popularly known for Bitcoins. Nearly every third person or organization either knows about blockchain technology or uses it. Blockchain technology can address most of the issues related to Digital Transactions, Double Spending, and Currency Reproduction. The chapter will discuss the basic concept of Blockchain, its history, how its networks and technology work, and how its primary technologies evolved. By the end of the chapter, the technical design and expected outcomes will be clearly understood. The chapter also tries to review other research done in this domain.
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Fundamentals Of Blockchain Technology

A Blockchain is a data structure or a decentralized ledger used for keeping records of transaction or any event. It records all the transactions across peer to peer network. Blockchain is a chain of block that contains information. As we all know that it’s a distributed system it confirms the transaction without the central authorities (Steen, 2007). He is shows that the system is connected to a single node which clearly reflects that this is a centralized network system. Drawback such system is that if central system shuts then every other node gets disconnected. Image b reflects decentralized network where there is interconnection between the nodes. Each single node is connected to another node.

Key benefits of the technology is that it increases transparency, security is increases, unchangeable records, transaction time is fast and as there is no third party involved it also reduces cost. But there are some aspects that can be hindrance in the adoption of this technology. There are the technology is complex to understand, it can increase anonymity that means who is performing what transaction is unknown and there are lots of challenges faced in implementation of this technology. All these points are also some of the reasons which are hindering the banking sector from implementing this technology.

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