Blockchain, cryptocurrencies and so much more
What is Blockchain and how is it changing the world?
Hello, everyone! My name is Vítor Sousa! I work as R&I Project Engineer at Ubiwhere, leading Research and Innovation projects in the areas of Precision Agriculture and Industry 4.0, handling the digitalisation of processes through DLT and Blockchain technologies. I wrote several scientific articles on the theme, but today I bring you a fresh and easily understandable perspective on the basics of Blockchain, its history and how this technology is shaping our world.
An introduction to blockchain
When in 2008, Satoshi Nakamoto published the whitepaper proposing the Bitcoin system, he was far from imagining that he would start a revolution in the financial sector, since that year the BTC cryptocurrency surpassed the value of fifty thousand euros. The document proposes the creation of a peer-to-peer network with cryptographic mechanisms, to register property rights and ensure that all transactions are valid and secure, a new financial system that is run by thousands of computers (nodes) distributed around the world, that is public and accessible to anyone for participation or consultation. In 2009 the first block on the Bitcoin network was launched, starting a system that provides the possibility of monetary transactions of digital cryptocurrencies without the need for an intermediary. The network is fully decentralized, managed and coordinated by all participants according to a shared set of rules.
Blockchain, a word that curiously does not appear in Nakamoto’s document, is the revolutionary technology that supports Bitcoin and is gaining more and more ground in the technological world. Blockchain works as a data structure organized in connected blocks. A new block of information can be added and queried on the network, but can hardly be changed or removed according to the blockchain’s own properties. Each block has a unique identifier(hash), like a fingerprint, obtained through the use of mathematical formulas known as hash functions, in Bitcoin’s case the SHA-256 function, which results in a hash with a fixed size of 256 bits, 64 characters. Every block also contains the hash of the previous block, thus forming a chain of linked blocks that cannot be edited or deleted without the agreement of the entire network. Data integrity and security is ensured through consensus mechanisms that only allow transactions after they have been validated by the network nodes. There are several consensus algorithms with different methodologies, however, they all have the same goal and purpose, to ensure the security of the blockchain network.
Bitcoin became the basis for multiple projects due to its open-source nature, and there are now thousands of cryptocurrencies, some with no specific purpose or objective, such as the well-known DogeCoin, a humorous and socially-oriented cryptocurrency based on an internet meme. However, the foundations for new technology were also laid and the scientific and academic community wasted no time. The immense possibilities for modernizing and digitizing traditional processes through blockchain resulted in a plethora of platforms targeting the most varied sectors, although some problems were identified in the bitcoin network such as limited scalability, high transaction fees, relatively long transaction times, and the well-known problem of energy expenses.
Blockchain beyond cryptocurrencies and digital money
The technology has been applied to thousands of use cases in various sectors and areas such as agriculture, fisheries, industry, energy, smart cities, tourism, and transport. The European Union itself has already reserved investment to support the development of technology and related projects. All the properties and characteristics of the blockchain, such as security, and reliability, make technology an excellent choice for the architecture of various solutions.
How can tech companies adopt this solution
As a technology company adept at opensource, which lends itself to always be at the crest of the technological wave, Ubiwhere has been investing and researching integrated blockchain technology solutions.
In the European funded project drEVen project, Ubiwhere created a solution that collects data from the VICINITY platform and determines the best time to charge electric cars based on photovoltaic energy and storage production capacity, as well as market conditions (energy injection from the network). Users are notified when they can take advantage of lower rates, and all transactions are carried out via the Ethereum blockchain.
On the other hand, in European projects such as 5Gzorro and 5GaaS our focus is to develop new decentralised markets in the telecommunications sector. All trades, offers, price and other information, are recorded on the blockchain. Ethereum, Corda, Hyperledger Indy and Aries are some of the technologies explored.
In Thumbeo, an innovative solution for corporate fleet management, we are working with Polygon to record information related to vehicles in a fleet by allowing the devices installed in the vehicle to send usage data directly to the blockchain network.
Zenithwings, Ubiwhere’s spin-off company, has implemented some use cases targeted at the agri-food sector. Winechain is a decentralised wine certification solution that ensures the quality and authenticity of the product. The production data and certifications achieved by the wine are registered on the blockchain and approved by the certifying entities. The SmartAgriChain project intends to digitise the entire certification process for agri-food products. A certification platform where certifying entities can develop their smart contracts and producers can obtain their products’ certification. The whole certification process will be registered on the blockchain through interaction with smart contracts. In SmartBlueChain, the project to begin, the intention is to create an innovative certification process for agri-food products in the blue economy. The aim is to develop smart contracts that digitise the different types of certification applied to developments in the blue economy and create a reliable tracking system to certify the entire value chain. These last two projects use blockchain technology from Hyperledger, an open-source project from the Linux Foundation, with strong partners such as IBM, SAP, Intel, which offers a wide range of frameworks and toolkits, programmers and companies. Its modular structure ensures individual components’ development without affecting the network’s general nature, with APIs for other clients or applications to communicate with the entire core blockchain infrastructure. Unlike Bitcoin and Ethereum, it does not have any cryptocurrency of its own. The hyperledger ecosystem promotes several blockchain technologies such as Hyperledger Sawtooth (a modular blockchain suite developed by Intel, which uses a new consensus algorithm called Proof of Elapsed Time), and Hyperledger Fabric (led by IBM and designed as a foundation to develop high-scale blockchain applications with a flexible degree of permissions). It also provides several useful tools such as Explorer that allow you to query blocks, transactions and associated data, network information, and any other relevant information stored on the blockchain and Caliper. This benchmark tool will enable you to measure specific blockchain implementation performance with a set of predefined use cases.
Blockchain: the revolution
More than a revolution for the financial system, Bitcoin and its Blockchain technology are shaping the technological world. For ten years, it has gathered strong popularity in the community. The support of various organizations and governments evolves and has been tested and validated in thousands of use cases worldwide for the most diverse sectors and areas. More than cryptocurrencies, blockchain is changing the way it stores and transfers data and information across networks. When it reaches maturity, I believe that it can cause a revolution wholly and worldwide change the web as we know it.
Currently, some tools allow any individual or entity to create their blockchain and tailor it to their needs, such as Substrate, the technology behind Polkadot. Substrate is a development framework based on the Rust programming language, with a modular structure that supports multiple smart contract platforms, including Ethereum’s EVM. It allows the development of smart contracts in several languages, chooses the consensus mechanism to use on the network, or develops a new one, integrates with other existing blockchains networks, or creates a new cryptocurrency. Imagination is the limit.
Ubiwhere will undoubtedly continue to contribute to the development and research of this technology applied to use cases in smart cities, energy, agriculture and industry 4.0. We can also create our Ubichain with Substrate, implement UbiConsensus, launch UbiCoin and develop the UbiCromos dApp to digitise our sticker book. Here’s the idea.
