What is blockchain?
Business networks today are often inefficient because each participant in the network keeps records, or a ledger, of all transactions between all the parties that the business interacts with. This process is expensive because of duplication of effort and intermediaries adding costs for their services.
One solution to this problem is blockchain, which provides a shared ledger(record) technology that allows any participant in the network to see the one system of record, or ledger. By using blockchain technology, businesses can benefit from a more efficient transfer of goods and services.
The core requirement for a business blockchain:
Shared ledger, smart contract, privacy and trust
We observed that businesses never operate in isolation. They always work together with other businesses, with governments, with banks, with all types of organisations within markets.
And effectively, wealth is generated by the flow of goods and services across these business networks.So assets are transferred across the business network.
And we also observed the assets are of two different types.
There are tangible assets like your house or your car.
And there intangible assets like a piece of digital music, or a financial instrument such as a bond, or a piece of intellectual property.
cash is also an asset which has the interesting property of anonymity. (Effectively, I don't know if I'm given a five Euro note, where that five Euro note came from and also where it's going to go to after I've owned it. )
Ledger is the system of records for business. Business will have multiple ledgers for multiple business networks in which they participate. So, ledgers are the key to effectively recording the flow of assets in and out of an organisation. The ledger´s updated every time a transaction occurs. They record which assets flow into and out of an organisation.
Blockchain at the very highest level is a trusted, distributed ledger which has a shared set of business processes across all the members of the business network. That's it.
