Blockchain – Current Technical Trends

Summary

Blockchain is undoubtedly the hottest topic in IT now. There are hype all over the world on this new technology. Many people even think that it will be a game changer for different industries. But how to build a blockchain platform? What types of platforms are available in market? What are the popular freeware/paid-ware? What programming techniques or software skills are needed?…. In the following articles and the ones to come in near future, I am going to share my knowledge and experience gained over the past few months of blockchain implementation.

Blockchain platforms can be broadly classified as “Permissionless”  or “Permissioned”. Let’s go through their characteristics, example freeware, sample applications…

Permissionless Blockchain

Permissionless blockchain is one that has absolutely no access restriction. Anyone with an internet connection can send transactions as well as become a validator. Since it’s open to all, it’s applications are usually targeted to B2C. Bitcoin and Ethereum (I’m sure you’ve heard of them already!) are the most typical and successful implementations of permissionless blockchain. Any online user can register to these platforms by creating a wallet. And with his/her wallet address as ID, a user can trade his bitcoin/ETH with others. He can even participate in the transaction validation process(so call “mining”) and get bitcoin/ETH as reward.

Popular Platforms in the market

With all the fundamental concepts and techniques in mind, you can of course develop your own blockchain platorm. But with limited time and resources, there is no need to re-invent the wheel. A lot of brilliant developers have already done this for you. Below is a list of free and popular permissionless blockchain platforms in the market

• Ethereum
  an open-source, public, blockchain-based distributed computing platform and operating system featuring smart contract (scripting) functionality. It is widely adopted as a platform for issuing ERC20 tokens and ICO. (will cover these concepts in detail later)
• Openchain
  an open source distributed ledger technology. It is suited for organizations wishing to issue and manage digital assets in a robust, secure and scalable way.
• NEO
  a non-profit community-driven blockchain project. It utilizes blockchain technology and digital identity to digitize assets and automate the management of digital assets using smart contracts. Using a distributed network, it aims to create a “Smart Economy”.

Sample Applications

A perfect platform but without good application means nothing at all. Followings are some of the successful and popular permissionless blockchain decentralized applications:

• Bitcoin
  earliest and most successful use of permissionless blockchain technology. It is a decentralized digital currency that enables instant payments to anyone, anywhere in the world. Bitcoin uses peer-to-peer technology to operate with no central authority
• ICO (Initial Coin Offering)
  a type of crowdfunding using cryptocurrencies. It can be a source of capital for startup companies. In an ICO, a quantity of the crowdfunded cryptocurrency is sold to speculators or investors in the form of “tokens”, in exchange for legal tender or other cryptocurrencies such as bitcoin or ETH. Ethereum is the most popular choice of platform to issue such tokens. There exists a standard called ERC20 for the issue of tokens which we will explain more in the coming articles.
• Cryptokitties
  a blockchain based virtual game that allows players to purchase, collect, breed and sell various types of virtual cats.It represents one of the earliest attempts to deploy blockchain technology for recreational and leisurely purposes.

Similar to Apple app store and Android Play, there is a marketplace – State of the ÐApp where you can find the latest decentralized applications (so call ÐApp) built on top of the Ethereum platform.

Permissioned Blockchain

On the other hand, we have permissioned blockchain which a user cannot join unless he/she is invited by the network administrator. In other words, participation, transaction and access validation is restricted. Due to these properties, its applications are usually targeted to the B2B market.

Popular Platforms in the market

There are also production-ready platforms for permissioned blockchain in the market that can save tremendous efforts of building one from scratch. Most famous ones are:

• Hyperledger
  this project was initially contributed by Digital Asset and IBM. It’s actually an umbrella project (Fabric, Composer, Explorer, etc) of open source blockchains and related tools, started in December 2015 by the Linux Foundation. One of the distinguishable feature is having a modular architecture, allowing components such as consensus and membership services, to be plug-and-play. It can host smart contracts called “chaincode” that comprise the application logic of the system. And if you want to share data only with certain parties, you can create a private channel with just those participants. But unlike most of permissionless blockchain platforms, it doesn’t require a built-in cryptocurrency and mining.
• Corda
  an open-source distributed ledger platform, specially geared towards the financial world as it handles more complex transactions and restricts access to transaction data. But, it has also attracted interest from other industries including insurance, healthcare, energy and governments
• MultiChain
  a platform that helps users to establish a certain private Blockchains that can be used by the organizations for financial transactions. A simple API and a command-line interface are what MultiChain provides us. This helps to preserve and set up the chain.

Sample Applications

So far, permissioned blockchain applications are targeted more on the business space. Big service providers (like IBM, Microsoft, AWS etc) and big corporations of different industries are investing a lot of money, time and effort on the development of blockchain applications. Here are some examples:

• Trendlens (Joint venture between IBM & Maersk)
  a global trade platform using blockchain technology aimed at improving the cost of transportation, lack of visibility and inefficiencies with paper-based processess
• Hong Kong Monetary Authority
  HKMA and seven banks to joinly launch blockchain-based trade finance platform. It’s scheduled to have trial-run in Sep, 18.
• Everledger
  global startup that uses the best of emerging technology including blockchain, smart contracts and machine vision to assist in the reduction of risk and fraud for banks, insurers and open marketplaces.

Hope the above can give you an idea of the current situation of the blockchain space. In the coming articles, I am going to share further my experience of building blockchain platforms (both permissionless & permissioned) using the technologies mentioned above. Please stay turned. Thanks for reading.