How Blockchain Is Reshaping Financial And Data Science Fields
By Ratnakar Pandey on ALTCOIN MAGAZINE
The business value-add of blockchain will grow to slightly more than $176 billion by 2025, and then it will exceed $3.1 trillion by 2030 — Gartner 2017 Report
What We Are Going To Cover
- Distributed Ledger and Blockchain Fundamentals
- Blockchain Applications in Financial Industry
- Blockchain and Data Science
Genesis of blockchain lies in creating trust among the parties who don’t know each other. Blockchain technology leveraged decades of computer science research to create the first cryptocurrency Bitcoin in 2009. In the words of Satoshi Nakamoto, the creator of Bitcoin-
I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party.
https://www.youtube.com/watch?reload=9&v=WiRFuHXHBhk
Main Attributes Of A Blockchain
- Digital Record- Like a traditional ledger, they can be a record of anything.
- Distributed- Spread over many systems across different sites or geographies.
- Decentralized- No one in particular controls the ledger it’s the network that controls what happens
- Secure- Immutable, Irreversible and follows consensus mechanism to add info
- Replicated- Each member of the network has a full and identical copy of the info
- Automated- Actions are taken based on the agreed criteria without any intervention
Main Components Of A Blockchain
- Block- Contains details about transactions or any data, a cryptographic reference to the current block, previous block, time stamp, etc. Several blocks are chained together to create a blockchain. Any new information is added as a new block, post validation.
- Hash- A series of encrypted numbers and letters of a fixed length to create a digital fingerprint unique to the data or block, as human fingerprints are unique. Plays a vital role in securing the chain.
- Public Key- A digital signature in the form of encrypted hash to identify users on the network. This is known to other users
- Private Key- A digital signature in the form of an encrypted hash only known to a specific user to validate and push a transaction on a blockchain.
- Mining /Proof of Work- Computationally intensive part to guess a random number (nonce) and use it to compute the correct hash to add new information as a block.
The Blockchain will do to the Financial Systems what the Internet did to Media- Harvard Business Review
TOP FIVE Benefits Of Blockchain For Data Scientist
- Data is the King- Access and sharing of a large amount of diverse data leads to better models
- Garbage in, Garbage out- Blockchain’s consensus mechanism fixes many data quality issues
- Higher Processing Power- Blockchain based shared computing platform will give the needed boost to the processing power for churning out a more complex model. Example- https://golem.network/
- Real-time Analytics- Since each block contains a stream of data over a period of time, real-time analytics for areas such as fraud detection is much easier.
- Crowd Solutioning- Combining predictive analytics solutions from different sources may address the bias variance tradeoff and lead to better models.
How To Access And Develop Blockchain Applications Using Python
There are many packages/APIs being created in Python and R for blockchain analysis and mining. Some of them include-
•bitcoin- python [conda install -c auto bitcoin-python]
•Steem [ pip install steem]
•Blockchain.info [ pip install blockchain]
•Populus [pip install populus]
Most Of These Packages Will Allow You To Do The Following And Many More Activities
- Build a brand new blockchain and cryptocurrency
- Smart Contract
- Explore data on blockchain- statistics, network details, # of blocks etc.
- Get specific data from blocks
- Proof of Work
- Add new blocks (with appropriate permission)
- Wallet and payment processing
Key Skills Required
- Strong understanding of blockchain platforms such as — Ripple, Hyperledger, Bitcoin, R3, Corda, etc.
- Experience working with distributed databases and computing
- Strong coding experience- Python, Java, C++, etc.
- Keep abreast with the latest development, use cases, and architectural changes
Thanks for reading! Cheers!
