Distributed Technologies and Consensus Algorithms for Blockchain

Distributed Technologies and Consensus Algorithms for Blockchain

Cynthia Jayapal, Clement Sudhahar
DOI: 10.4018/978-1-6684-7524-9.ch006
(Individual Chapters)
No Current Special Offers


Centralized and decentralized systems are prone to security breaches while storing private data. It is challenging to establish trust when an administrator is not known. Blockchain-based technologies use distributed ledgers that can be trusted, audited, validated, and verified by network nodes. The assets stored in a blockchain are immutable, timestamped, and cannot be tampered because of the integrated cryptographic mechanisms. Consensus algorithms are used to validate the transactions and blocks stored in a blockchain. Multiple research reviews focus either on various application domains of blockchain or comparative study of consensus algorithms or security aspects. This chapter aims at providing a comprehensive review on blockchain technologies, performance metrics, and guidelines for choosing a blockchain technology and consensus algorithm based on an organization's requirements and protocols. This chapter also captures concepts on blockchain types, consensus algorithms, and typical applications of blockchain with its features.
Chapter Preview


Centralized systems have a single point of control. They work based on the client-server paradigm. Issues in centralized systems are single-point failure, less fault tolerance, easy to hack, and lack of trust. It has less maintenance cost. Decentralized systems have multiple authoritative nodes that coordinate the system. In decentralized systems, there is no single-point failure, it is difficult to hack, trust is higher and is more reliable. Nodes of distributed systems are located in a distributed fashion; they have equal authority and act as peer nodes. They prevent single-point failure and are more robust because of data replication. It has high throughput and is more reliable.

A database is a centralized ledger that stores data in a structured fashion. It is maintained by an administrator and is designed for Create, Read, Update and Delete (CRUD) operations. It works based on client-server architecture. It is recommended to store confidential relational data that need not be verified. A blockchain is decentralized and works based on distributed ledger architecture. It has READ and APPEND operations. It has complex algorithms for maintaining the blockchain. It is recommended where sharing, validation, and verification are required. Blockchain is a decentralized distributed ledger that stores information as a trusted entity by avoiding any middlemen. Various implementations of distributed ledger technologies are discussed by El Ioini and Pahl (2019).

A Group of transactions is held in a block, and the blocks are linked as a chain by storing the next block's hash in the previous block. A blockchain is recommended if redundant copies are to be maintained in distributed nodes if participating entities are not known to each other and are from different organizations; if a trusted 3rd party is required and if state information is to be stored.

Monrat et al. (2019) have curated blockchain architecture, structure, consensus algorithms, challenges, and typical use cases. Albayati et al. (2020), recommends regulatory support from the government, and enhanced user support has a major impact on building trust amongst users to adopt blockchain. Rizal Batubara et al. (2019) have also stressed the need for transparency and accountability for the widespread usage of blockchain. Al-Jaroodi and Mohamed (2019) have identified the requirements and benefits of blockchain implementation for healthcare, finance, logistics, manufacturing, energy, agriculture, robotics, and entertainment applications. Zheng et al. (2018) and Risius and Spohrer (2017) have reviewed the research perspective of blockchain framework.

This chapter gives an overview of blockchain properties, components, types, structure, operations, technologies, and consensus algorithms. Blockchain technologies focus on different technologies available to build a blockchain-based application and underlying framework. Each of these technologies provides additional support for authentication, transaction verification, consensus algorithm, identification, access control, and rewarding mechanism. Consensus algorithms are those used by peer nodes present in a distributed blockchain network to arrive at a consensus to decide on the next block that must be added to the blockchain. The nodes that run these algorithms are rewarded in public networks and are designated in the case of a private network.


Properties Of Blockchain

Following are the properties of blockchain that aid in building trust amongst unknown peers and various entities that use the information stored in a blockchain.

Key Terms in this Chapter

Distributed ledger: An e-ledger that is stored in a distributed fashion at peer nodes of a blockchain. It holds details of assets or transactions that are time stamped, stored in an immutable fashion, and are updated whenever there is state change.

Permissioned Blockchain: Public or private blockchain network in which participants must be given permission to view or write a transaction.

Smart Contract: Agreement stored as an executable code and is triggered automatically on execution of a transaction without any intervention.

Distributed Consensus Algorithm: Algorithm that is used by peer nodes present in a distributed blockchain network to arrive at a consensus, to decide on the next block that must be added to the blockchain.

Miner: A node in a blockchain network that runs a consensus algorithm to decide on the next block to be added to the blockchain.

Public Blockchain: Distributed blockchain network in which anyone can participate, view transaction and leave the network without anyone else’s permission.

Permissionless Blockchain: Public or private blockchain network in which participants require no permission to view or write a transaction.

Consortium Blockchain: Distributed network in which multiple parties with similar business goals and agreed upon common authorization and access control policies participate in operations of a blockchain.

Private Blockchain: Distributed blockchain network in which members are authorized to participate in operations of a blockchain with predefined roles and access control.

Merkle Tree: Binary hash tree constructed by repeatedly hashing pairs of child node hash values in order to ensure data integrity.

Complete Chapter List

Search this Book: