welcome to blockchainwelcome to blockchain … arguably, the most disruptive innovation yet (c)...

Welcome to

Blockchain … arguably, the most disruptive innovation yet

(c) RaceNext Information Systems Pvt. Ltd.

Version1.0, 15 Nov 2017.

28 Nov 2017 Blossoms, Tunga International

Mumbai

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(c) RaceNext Information Systems Pvt. Ltd. 2

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Emerging Technology Evangelist: 3DPrint, IoT, Blockchain, AI/ML etc. B.E., MBA HR, PGDST, ISO 9001, CMMi, CQA, Certified Company Dir Corporate: Godrej & Boyce Mfg, CAD/CAM, GeometricSoftware Automated Testbed for enterprise Products Web, CBS projects for Citi UK, Deutsche Bank VP, IT for Reliance Industries Ltd.: Petro, Retail, Refinery, Oil, HR etc.

Arvind Prabhu

World Money

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Bitcoin: July 2017: $41B Aug 2017: $66B Nov 2017: $136B

Cryptocurrencies

• A digital asset … a medium of exchange … uses cryptography to control its creation and management, rather than relying on central authorities – JerryB, Andrea C: “Bitcoin: A Primer for PolicyMakers”

– Allows people to make instant, anonymous transactions online

– Each transaction is recorded in a public record on the network

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Bitcoin History

• 2009: Satoshi Nakamoto invents bitcoin, with Gavin Andreson

• 2011: 1000 merchants reported

• 2012: FinCEN, US Drug Enforcement ‘seizes’ bitcoins

• 2013: People’s bank of China makes it illegal

• 2014: Las Vegas, Dell, Microsoft accepts bitcoin

• 2015: Bitstamp xchange goes offline: 19000 bitcoins stolen

• 2015: Nasdaq executes first bitcoin trade using Linq ledger

• 2016: Over 3500 Google scholar articles; Barclays accepts bitcoins

• 2017: More than 10,000 GitHub projects;

• 2017: Japan, Russia, Norway banks makes bitcoin legitimate

• 2017: People’s Bank of China ready with own virtual currency

• May 2017: 1 Bitcoin > $ 2000 • June 2017: Bitcoin symbol included in Unicode

• Aug 2017 : Bitcoin splits into two different currencies

• Nov 2017 : Bitcoin > $8000

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> $10K

Advantages

Volatile Hack prone Unregulated Identity theft

Risks

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Rapid rise in transactions


This is for information only. You should make investment decisions on your free will

Bitcoin listed on Exchange


Bitcoin: The design

Distributed digital ledger

Peer to peer transactions

Consensus Protocol

Bitcoin design components

Timestamping

Elimination of the ‘double spending’

Cryptography based security Safety

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Bitcoin Mining

No entity to print and distribute money

Miners earn bitcoins by solving math problems using special

creates an incentive for more people to mine.

Miners solve equations; approve transactions

Ensures fairness and keeps the network stable, safe and secure

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• Mining is kept resource intensive by design

• ‘Difficulty level’ increases as a servo-feedback when more people join the distributed network i.e. Rate of block creation rises above a upper control limit

Bitcoin Mining Infra

Cloud based services available

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Other Crypto Currencies

• Ether, Litecoin, Unobtainium, many more

• Over 1200 virtual currencies listed

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Top currencies as of June 2017


Transactions available online

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Bitcoin in India

• Lot of caution and debate… unabated popularity

• 10% of transactions from India

• Indian startups have generated faith with strong KYC and AML in place

• Report of FinMin, ITMin, NITI Aayog, RBI expected

– Even if legalized

– Bitcoin investor will be taxed, Returns will be taxed

– Transactions will be governed by RBI act, FEMA act

• Nov 2017 INDIA BLOCKCHAIN – Niti Aayog –

Lakshmi Coin?

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What is an ICO

• ICO is an application whereby organizations of any size can raise money peer-to-peer by offering tokens or coins in a new venture, project or network.

• Coin and Tokens

• IPO v/s ICO – IPO: a privately held firm raises capital through public markets

by issuing stock that investors can buy.

– IPOs are highly regulated affairs, involving a number of

– intermediaries, such as investment bankers, exchange

– operators, auditors, lawyers and crowdfunding platforms

– IPOs are issuances of securities, mostly equities.

– ICOs are unregulated and have multiple variations in offerings

– The risks, legal implications of ICOs are still evolving

• Risks at the initial stages are high


There won’t be millions of tokens. There will be millions of kinds of tokens. — Richard Olsen

Terms: Hash, Collision


Noun/verb

Function to scramble input data of any size to an output data of fixed size.

Hash value, hash code, hash key

Accelerated searches of data

Identifying DNA matches

Cryptography

No two messages get same hash

Infeasible to reconstruct message from a given hash key

Hash Two input sets resulting into same hash value

Collision

Term: Merkle Tree, Hash Tree


Merkle Tree (Hash Tree) created internally when a block is

encrypted in the blockchain.

Data input broken into a series of sections

one-way conversion to generate the hash key with least collisions.

Hash done recursively upto root node.

Benefit: quickly identify ownership and multiple level of security applied.

SHA-1 and MD5 are examples

Checks for inconsistencies

Reduces size of data transmitted

Term: Block


A set of transactions grouped together for verification.

Each block has a unique identifying number, creation time, transaction data, and a reference to the previous block. Often, the contents are encrypted.

The block header contains the merkle root hash code.

The new block is put on the network to verify if its transactions are legitimate.

The first block of a block chain. Does not have the reference of

the previous block.

Block Genesis Block

Blockchain: Chain of Blocks


Terms: Smart Contracts


Smart Contracts Pre-defined business steps stored in a blockchain, in the form of computer

logic and data parameters, that can facilitate a legally enforceable transaction of digital value between two parties

Automatically triggers when specific conditions are met.

Automates decision making on the network

No censorship, downtime, fraud or third party interference.

Terms: Consensus Protocol


Protocol a system of rules

Allows entities of a communications system to exchange information.

defines rules syntax, semantics and synchronization of communication and possible error recovery methods.

May be implemented by hardware, software, or both.

Consensus The process of keeping the ledger

transactions synchronized across the network

to ensure that ledgers only update when transactions are approved by the appropriate participants

update with the same transactions in the same order

• Alt Chains – Side chains – Gold chain

Types of Blockchains


Public, Permissioned, Private Public is open source. Anyone can participate in the transaction, everyone can see what blocks are added and participate in the 'consensus' process. Miners are incentivized.

Permissioned on closed-loop: Users are added selectively. The right to view as well the right to validate transactions is provided to few pre-selected nodes.

Private: The write permissions are restricted to one entity and the public have no access at all. Miners may not be incentivized.

Blockchain: Ledger of Everything

• Foundation of trust, privacy, inclusion, transparency

• Smart contracts ensure irrevocable compliance.

• Nobody can override the consensus.

• Very high degree of certainty to outcome of a contract.

• “Native medium of transacting and storing value” – Don Tapscott


Benefits of Blockchain


Blockchain flow

Transact Block Approve Hash Chain Execute


How to identify Blockchain Use cases?

Multiple parties use the data, want to update the data

Transactions are inter-dependent on each others’ transactions

Cumbersome to track progress of the requested transactions

Risk and severity of fraudulent transactions is very high

Intermediaries are adding cost, delays, complexity

Mandatory requirement of verification of transactions

Manual documentation, processing, reconciling the information Two transacting parties only trust a third party intermediary

Assets need to be backed up in real time


Save money, precious time and efforts on trial

and error. Avoid common mistakes,

embarrassment and surprises

Connect with experts &

consortiums for collective benefits.

Survey: potential areas in fin sector


HR – Know Your Employee


Tamper proof transcripts ‘signed’ by issuing institute reduces time for verification

Employee KYC/Identity: PoI, PoA and now PoE

Candidate credentials, performance available from job to job

Fast and secure international hires/assignments, work permits and payments overseas

Smart Contracts for entitlements based on tenure, location, roles, performance

Supply Chain – Logistics, Warehousing


Order to cash with smart contracts

Manage and track paper trail of consignments across globe

Ocean freight industry/security, traceability & transparency for overseas shipments.

Reduce costs: improved inventory, early alerts, fraud proof supply

Food safety and traceability from farm to factory

Blockchain for Real Estate

Govt of AP to organize land titles, records to prevent frauds

REcoin cryptocurrency backed by Real Estate


Bankchain: A cost-effective way to start

Ask [email protected] to join Bankchain consortium now…

Get access to active projects, source code. Adopt in a structured, efficient way.


mailto:[email protected]

Popular Blockchains/Platforms


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Quorum

Symbiont Assembly

Stellar Ethereum

Bitcoin

Ripple Everledger

Hyperledger Factom

Ambrosus

EOS Counterparty

NEO

Bitshares

MORPHO

BigChain DB

OpenChain

Credits

Corda

Blockapps Chain Core

ERIS Monax

https://medium.com/blockchain-blog/17-blockchain-platforms-a-brief-introduction-e07273185a0b

Ardor

Hydrachain

The stack


Which platform should I choose

• Parameters to compare – License

– Permission: Ledger type

– Asset Classes

– Domain, Industry

– Consensus Protocol

– Programming, Coding

– Encryption

– Scalability: nodes

– Scalability: transactions

– Test certification

– Fault Tolerance

– Compliance

– … and so many more


Avoid common mistake. Discover which platform is right for your requirements.

Resources


Thank You

Be prepared if a deadline for implementation suddenly arrives.

Save money, precious time and efforts on trial and error.

Avoid common mistakes, embarrassment and surprises

Connect with experts & consortiums for collective benefits. Wish you great luck, everybody!


[email protected]

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welcome to blockchainwelcome to blockchain … arguably, the most disruptive innovation yet (c)...

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