What is Blockchain, Ethereum, Smart Contracts?
The modern world is filled with a plethora of technological advancements that seem like concepts right out of a science fiction movie. From artificial intelligence (AI) to machine learning (ML), and the internet of things (IoT) concept, there seems to be no slowing the relentless march of progress. Since 2009, a new entrant has made its way into the elite class of emerging technologies.
This new technology called blockchain has the potential to disrupt the global business process. The technology has spawned numerous systems, networks, and protocols that are attempting to solve nagging issues across the globe.
Blockchain technology first came to light in the 2008 Bitcoin white paper written by the mysterious Satoshi Nakamoto. In this document, the author[s] presented a network architecture that could support a digital currency using cryptography hence the term “cryptocurrency.” Satoshi’s work provided a reasonable solution to the double-spending problem by having an immutable shared ledger, distributed among the participants of a peer-to-peer (P2P) network. This Bitcoin network was ground-breaking as it produced the blockchain; the first ever successful implementation of distributed ledger technology (DLT).
Satoshi by no means invented the blockchain, instead he/she/they adapted many core concepts from the work of cryptography legends like Stuart Haber and W. Scott Stornetta. The Bitcoin white paper lists the research studies of these two men in the reference section. In the early 90s, Haber and Stornetta worked together on developing document time-stamping protocols, as well as secure naming architecture for bit-strings. The two also worked together on incorporating Merkle trees into their Linked Time-Stamping Authority (TSA) protocol. These concepts became a significant part of the first ever iteration of the blockchain that was developed by Satoshi Nakamoto.
The blockchain is a network of connected nodes that share a standard ledger which records all the transactions in the network. The ledger is updated in real-time upon the successful confirmation of a transaction by a majority of the network. The transactions are grouped into blocks that are joined one to the other in a linear progression hence the term, “blockchain.” One unique trait of a blockchain is that there is no central server as the network is decentralized. This decentralized architecture means that there is no network hierarchy and all nodes are in theory, equal. Blockchains use cryptographic keys to encrypt and decrypt transactions. Since the advent of blockchains, there have been several iterations, each bringing a new unique set of functionalities to the evolving industry. Vottun is hosted on the Ethereum blockchain which is a unique sort of decentralized network.
Bitcoin was the first blockchain network but users soon discovered that there were certain limits to which the network could be used. At the time, blockchain enthusiasts were beginning to realize the immense potentials of the blockchain far beyond payment processing. However, trying to build any non-payment applications directly on top of the Bitcoin blockchain proved to be impractical due to the number of layering protocols required. In 2013, a young Russian-Canadian Wunderkind named Vitalik Buterin set down his ideas for another blockchain protocol called Ethereum.
Ethereum is an expansion of the Bitcoin blockchain premise by creating a platform that supports the building of intuitive applications on it without the need for complicated layering procedures. While the Bitcoin blockchain focuses on being a network for the transfer of bitcoins as a means of payment settlement, Ethereum focuses on leveraging the power of the blockchain to give developers the ability to create decentralized applications (DApps). It is for this reason that the Vottun project is hosted on the Ethereum network. The Ethereum project was publicly announced to the crypto community in 2014.
The fundamental similarity between Ethereum and Bitcoin is that both blockchains store the entire record of all transactions right from the Genesis block, on the blockchain. The Genesis block is the first transaction block in a blockchain. Ethereum is a transaction state machine which means that it can receive inputs, interpret them and transform itself into a new state. Ethereum provides a platform for developers to build DApps as well as Decentralized Autonomous Organizations (DAOs). Ethereum also introduced the next ground-breaking protocol to the blockchain revolution, smart contracts. Smart contracts play a pivotal role in the way and manner in which the Vottun system can deliver its stated functions.
Smart contracts are self-executing contracts. They utilize DLT to store the parameters that define a transaction, verify the transaction, and execute the contract. Self-executing smart contracts do not require any human intermediary. At its most basic, a smart contract is like a sophisticated “if function” used on spreadsheet programs like Excel. Parameters are coded onto the contract the direct the steps and actions to be taken, for example, if “x” hours are worked, pay “y” amount.
The Vottun project uses the robust smart contracts protocol of the Ethereum network to provide premium certificate authentication services. Vottun also the smart contract framework to facilitate intuitive processes in its ecosystem.