Crypto Academy Season 3 Beginners' course - Task 2: @yousafharoonkhan

(2) Define decentralization. Describe the advantages and disadvantages of a decentralized system. In what areas of life can a decentralized blockchain be helpful? (write in own words)

Welcome to my homework task for today, after learning about the importance of the new technology called blockchain and how it have changed the former ways of doing things in many sectors of human life. Now I will be explaining what blockchain is, before I will start my homework task, Thanks.

source

WHAT IS BLOCKCHAIN?

Blockchain is system of storing data that is difficult or impossible to alter, hack, or manipulate those stored data in the system. A blockchain is an important digital decentralized ledger of data, which is duplicated and distributed among the computer systems on the network. Every block has a number of transactions, new transaction are added as the occurs on the blockchain, and every block will have the record of that new transaction added to its own ledger. The Blockchain uses a decentralized data management system called Distributed Ledger Technology (DLT). So therefore, it's safe to say that a Blockchain is a Distributed Ledger Technology use to record transactions that are immutable, impossible to alter.

DEFINE DECENTRALIZATION

Decentralization is a system by which all control of data, decision, etc are distributed or delegated among participates. These power or control/ authority are not centralized but shared among the computers. In decentralization, one single entity can't take decision but decision are taken with a consensus, which means that decision are take collectively.

In decentralization transaction data are distribution by the computers and everyone of the computers has the power to control it's own copy of data stored on it, each of the computers have the right to verify and validate transaction independently, and share it among the computers which will now store the copy of the transaction on its database. So therefore every of the computers have similar transaction records on on them, this makes it immutable and secure, because if one computer have error, others will find it out and it will be corrected.

Describe the advantages and disadvantages of a decentralized system

Advantages

1. Accuracy
   Every transaction will be verified and approved by thousands of computers on the decentralized network. This ensures that no human begin are involved in the verifying process, therefore no room for human error but an accurate record of transaction are obtain.

2. Secure
   A transaction data on the decentralized blockchain is secure, because thousands of computers on the network will verify the authenticity of that transaction, confirm it before it can be added to the network database. After validating and adding the data transaction into the network, it's impossible to alter, because it will be pinpoint by other computers on the network.

3. Transparency
   Transaction or decisions can not be manipulated because other thousands of computers will pin point it out. Therefore transactions is transparent because the majority of computers on the blockchain will validate the transaction, no room for manipulation.

1. Cost
   In decentralization there is no third-party, which help to reduce transaction costs

2. Privacy
   In decentralization you have the freedom of private transactions and no body is regulating you or monitoring you.

3. Efficiency
   Decision are take immediately and no third-party to refer it to, make it more efficient in making transactions

Source

Disadvantage

1. Lack of Regulation
   Because it's not regulated by any third-party authorities, there might be a lot of illegal transaction on it.

2. illegal Activities
   it is use to perform illegal transaction and could put users at risk of be hack by dubious elements.

3. Very expensive
   The cost of building and maintaining it is very high, not easy to maintain also.

4. Transaction Time
   It has a slow transaction time per second, because all the computers need to confirm and validate the transaction, this affects the transaction it can perform at second.

In what areas of life can a decentralized blockchain be helpful? (write in own words)

1. Banking and Finance
   This sector stands the chance to be most beneficiary to decentralized blockchain. Integrating decentralized blockchain into the banking and financial system will increase operations. Banks work only business hours and on week days, meaning that you can't deposit on weekends.

2. Currency
   It can be use as a means of payment even if you don't have identification, this could be very important to people in war-torn counties or in areas were there is lack of infrastructure. With decentralized blockchain, you don't need verification identification to have saving or make payment.

3. Health Sector
   The Health Sector can take advantage of decentralized blockchain to store the data of their patients, medical data which will be secured without manipulation. This will help keep the patients data generated and signed more secure and privacy.

4. Personal Data
   Keeping data have never been an easy task, most especially valuable data of your property. Decentralized Blockchain can help you to secure the data of your property and in event of dispute can also help to detect the real owner. If you lost your documents, you can easily retrieve it from the blockchain and gives you the confidence that your property document is stored and have been verified on the blockchain, and is accurate and stored forever.

5. Smart Contracts
   In a decentralized blockchain, when smart contract is been integrated into helps to facilitate, verify, and negotiate any contract. Because smart contracts is a set of conditions agreed to, blockchain will make it secure, transparent and efficient. With blockchain, the agreement will be automatically triggered when the conditions are met.

6. Supply Chains
   Decentralized blockchain can be use by suppliers to store the originals of product they have, this will help to verify the authenticity of products by buyers.

1. Voting
   Decentralized blockchain will be very important in voting process because it will help to facilitate electoral system. Blockchain will eliminate many kinds electoral irregularities and increase turnout of participating voters. The decentralized blockchain electoral system will make it impossible to manipulate votes in any form. Therefore will be transparency and secure, and also reduce cost of personnels and the election results will be instant. It will also eliminate recount of votes or conciliation of election due to fraud.

CONCLUSION

The Introduction of decentralized blockchain technology is a welcome development, which if fully adapted will change our normal ways of doing things, and usher in a modern ways, that will be secure, transparent, efficient and cost reduction. Blockchain technology will be beneficial to all aspects of human life and it have come to stay.