A Comprehensive Survey of Blockchain Applications and Use-cases 2020

Blockchain Survey 2020

Following study have been conducted to highlight the important use cases of blockchain network, this article have been compiled after considering approx 25 research papers.

Introduction

The technology of blockchain and cryptocurrency have seen a marvellous surge in this technological era, due to its prominent characteristics over the other emerging technologies,

Blockchain have emerged as a fifth disruptive technology in the computing paradigm.

the usefulness of blockchain is indubitable, due to its impeccable performance features like trust less Peer-to-Peer (P2P) communication, decentralised, security, time-stamping, distributed consensus algorithms etc.

Cryptocurrency another buzz word always use in tandem with the blockchain technology, this application of blockchain have become popular and in fact revolutionised the financial structure of the world it has five distinguished factors as compared to the other financial systems

• It is decentralised and there is no central control in this system.
• It is pseudo-anonymous means it’s impractical to know the identity of a person who performs transactions.
• There is only limited supply of currency.
• Most of the cryptocurrency systems are open sourced.
• This currency will only gain its value when more and more users connect to its ecosystem.

The idea of cryptocurrency was first introduced in a paper named “Bitcoin: A Peer-to-Peer Electronic Cash System” in 2008 with an alias name Satoshi Nakamoto, in that white paper author have discussed a solution of currency transaction in a novel way that we call as Bitcoin, after a passage of time another cryptocurrency named Ethereum gained popularity which was introduced by Vitalik Buterin in his paper in late 2013,

The founder of Ethereum have claimed to have overcome the limitations of Bitcoin, he formulated a way to change ownership on the basis of cryptographic rules if certain conditions met, this phenomenon is known as smart contracts.

Facebook had also introduced its own cryptocurrency named as Libra in 2019 which aimed to establish a global virtual currency platform in comparison with Ethereum and Bitcoin, Libra was designed as stable coin which means that its value is backed by some assets that can be fiat-money, commodities etc. Albeit to the popularity of Libra, its final picture is still in the pipeline. Apart from the above mentioned cryptocurrency systems blockchain have also provided numerous applications aka dApps or decentralised applications in various domains i.e property management systems, degree verification system, insurance systems etc.

Technical Definitions

In this section, we will discuss some technicalities of Blockchain and Cryptocurrency, you can jump to other section if you are not interested in technical terms.

Blockchain

Technically blockchain consists of series of encrypted blocks that are joined together in the chronological fashion these blocks contains transaction histories thats why its also called ledger when this ledger shared among the participants connected with the blockchain network it becomes distributed ledger, the most important property of these blocks is that they are immutable in nature which means any change in the transaction history will result in the creation of new block, new block can only be added by the consensus of participants within the blockchain network and an algorithm of consensus is used to entertain this purpose,

the main concept of the consensus algorithm is to grant multiple nodes within a network a distribution right to perform update within a system by following a set of pre-defined rules in a secure fashion.

There are 3 kinds of blockchain networks :

• Public Blockchain Network allows any one to become a node and perform transactions
• Private Blockchain Network is a private network and created solely for specific use cases e.g developers create private blockchains to test their softwares.
• Consortium Blockchain Network allows only specific parties to join the network e.g government parties use consortium blockchain to connect and perform transactions.

Blockchain requires heavy file storage, to solve this issue decentralised storage systems like Swarm, IPFS, BigChainDB, Interplanetary File System (IPFS) etc are used.

Cryptocurrency

Cryptocurrency is the most effective and successful application of blockchain, among various cryptocurrencies bitcoin is the most popular one.

Surprisingly there is no such thing as coin used to perform transaction in the crypto-network neither a cryptocurrency wallet contains any virtual coins but its the series of transactions records that creates the amount of coins owned by a certain party and the owners use their private key to claim their ownership.

In the Ethereum network smart contracts are used to enforce the predefined terms and conditions and these contracts are executed by the parties that are interested in performing transactions over a network. But smart contracts sometimes become “candy for hackers” as once they are created they cannot be modified, for a developer to remove bugs he have to start with a new contract and make a transfer of data from old contract to a new one , in 2016 smart-contract-based attack happened and about $60 million were stolen. For a transaction to be made in crypto-network, that transaction is first announced over a network and goes in to a central pool of unprocessed transactions that pool is called a mempool, the miners over a network pull these unprocessed transactions and try to create a nonce value which is gained by solving a huge mathematical problem, that value after thorough verification allow a transaction to be a part of ledger.

Transfer of coins is just the change of owners done by just changing addresses.

Blockchain Based Platforms

There are a number of blockchain platforms available today and it keeps on increasing by the passage of time and it is imperative to understand them in order to understand the ambience of this technology, these are

1. Currencies for transactions e.g Bitcoin, Litecoin.
2. Exchanges and Interoperability to enable communication among different blockchains e.g Binance Coin.
3. Data and Cloud Services for data management or cloud platforms e.g Golem.
4. Dapps Platforms these are smart contracts enabled platforms e.g Ethereum, Cardano.
5. Gaming, Media and Social for gaming and social media etc e.g Steem, Tron.
6. Privacy for untraceable online transactions e.g Zcash, Monero.
7. FinTech for financial services e.g Ripple.
8. Business/Enterprises helps to improve business operations e.g Waltonchain.
9. Miscellaneous for prediction, IoT etc e.g IOTA

Applications and Use cases of Blockchain

In this section, we will discuss some use cases of blockchain in various domains.

1. In education domain, various education institutes have leveraged this technology and mostly varsities came out in the front foot, Sony Global Education system have used blockchain for degree management and information system, the University of Nicosia was the first school to manage students certificates in MOOC platforms also (MIT) Massachusetts Institute of Technology with the collaboration of Learning machine company implemented a digitised badge mechanism on blockchain. Albeit to the usefulness of blockchain in the education domain on the other side there are some tradeoffs as well for example the immutability feature of blocks makes it almost impossible to modify a student’s record even for some legitimate purpose.
2. The applicability of blockchain technology on humanitarian ground have also gained popularity, rationally speaking the matter of corruption is a very serious issue specially in underdevelopment countries, blockchain oriented applications are used to alleviate corruption and also to help humanity, Star network have used blockchain network to deliver aid in the scenario of crises, similarly to avoid corruption in land registry, BitLand registry have been created in the year of 2015 in Ghana, also the AID tech company in 2015 have used blockchain supported system to provide refugee support in Lebanon to create digital identities of refugees that were used to buy consumer goods. Furthermore a pilot project has been initiated by the UN Office in 2017 in Moldova to protect young children and women from illegal trafficking.
3. Some approaches have also been developed to make use of blockchain networks as a solution to allocate, coordinate and settle energy related transactions in multi-carrier districts with heating and electricity sub-networks.
4. Business requires financial security and privacy, as blockchain is a secure network it solved this problem to a great extent, in this context some approaches have been developed to solve privacy protection problem in a supply chain network, the basic scenario was to enable a secure communication channel between small enterprises and financial institutions along with the collaboration of government bodies, after the application of blockchain the safe, confidential and segregated private transactions have been observed.
5. Artificial Intelligence (AI) have also contributed in cryptocurrency ecosystem, some approaches have been developed to predict the up and down spikes of cryptocurrencies on the basis of market history, random forest a machine learning technique have been applied for this purpose and surprisingly some positive results have been observed.
6. Some researchers have proposed the concept of decentralised autonomous organisation (DAO), the information flow in the organisation is not channelled through hierarchy but by using a public ledger for secure and transparent flow, furthermore organisational strategic decisions can be made by democratic voting over a blockchain network.

Blockchain based Governments

Blockchain oriented governments concept is also gaining popularity, many bureaucracy related operations are now shifting towards automated blockchain applications, there are some similarities between blockchain and bureaucracy i.e

1. Both execute on rules
2. Both of them work for (IP) Information Processing
3. Both tends to establish trust in society

Some governments have also took initiatives to use blockchain applications, For example Estonia, Australia, Ukraine have built their voting systems on blockchain, US is working to shift medical related information system to blockchain,

China is planning to build a “BlockChain city”

approx 40 other countries are working on more than 100blockchain projects.

Conclusion

The adoption of blockchain and cryptocurrency is increasing all around the world and according to research it is mainly coming from developed countries, but the trend of attention and awareness is very positive from underdeveloped countries as well. But According to a survey there is still some hesitation in the adoption of blockchain due to the uncertainty in its regulation rules and laws especially in non-financial sectors. There is also an Islamic point of view for bitcoin and cryptocurrency but as of now there isn’t any clear fatwa on it but there is a negative inclination towards it due to its involvement in illegal activities. There are also some suspicions and questions in capturing accurate records of the ongoing transactions as many of them taking time longer than expected and it had been concluded that it is due to the lack of sufficient incentives for peers and miners in the network to verify and propagate transactions. Power consumption is also a valid issue in cryptocurrency mining, it becomes more detrimental in mobile devices, there are various javascript based minors e.g CoinHive are available that causes huge power consumption

References

1. Y. Yuan and F.-Y. Wang, “Blockchain and cryptocurrencies: Model,techniques, and applications,”IEEE Transactions on Systems, Man,and Cybernetics: Systems, vol. 48, no. 9, pp. 1421–1428, 2018.
2. D. Vujiˇci ́c, D. Jagodi ́c, and S. Ran ̄di ́c, “Blockchain technology,bitcoin, and ethereum: A brief overview,” in2018 17th internationalsymposium infoteh-jahorina (infoteh). IEEE, 2018, pp. 1–6.
3. V. Brühl, “Libra — a differentiated view on facebook’s virtual currencyproject,”Intereconomics, vol. 55, no. 1, pp. 54–61, 2020.
4. E. Feig, “A framework for blockchain-based applications,”arXivpreprint arXiv:1803.00892, 2018.
5. K. Salah, M. H. U. Rehman, N. Nizamuddin, and A. Al-Fuqaha,“Blockchain for ai: Review and open research challenges,”IEEEAccess, vol. 7, pp. 10 127–10 149, 2019.
6. V. Gatteschi, F. Lamberti, C. Demartini, C. Pranteda, and V. Santa-maria, “To blockchain or not to blockchain: That is the question,”ITProfessional, vol. 20, no. 2, pp. 62–74, 2018.
7. M. Garriga, M. Arias, and A. De Renzis, “Blockchain and cryptocur-rency: A comparative framework of the main architectural drivers,”arXiv preprint arXiv:1812.08806, 2018.
8. M. Xu, X. Chen, and G. Kou, “A systematic review of blockchain,”Financial Innovation, vol. 5, no. 1, p. 27, 2019.
9. F. Knirsch, A. Unterweger, and D. Engel, “Implementing a blockchainfrom scratch: why, how, and what we learned,”EURASIP Journal onInformation Security, vol. 2019, no. 1, p. 2, 2019.
10. G. Chen, B. Xu, M. Lu, and N.-S. Chen, “Exploring blockchain tech-nology and its potential applications for education,”Smart LearningEnvironments, vol. 5, no. 1, p. 1, 2018.
11. A. Zwitter and M. Boisse-Despiaux, “Blockchain for humanitarianaction and development aid,”Journal of International HumanitarianAction, vol. 3, no. 1, pp. 1–7, 2018.
12. Q. Yu, A. Meeuw, and F. Wortmann, “Design and implementation ofa blockchain multi-energy system,”Energy Informatics, vol. 1, no. 1,pp. 311–318, 2018.
13. C. Ma, X. Kong, Q. Lan, and Z. Zhou, “The privacy protectionmechanism of hyperledger fabric and its application in supply chainfinance,”Cybersecurity, vol. 2, no. 1, pp. 1–9, 2019.
14. J. Sun, Y. Zhou, and J. Lin, “Using machine learning for cryptocur-rency trading,” in2019 IEEE International Conference on IndustrialCyber Physical Systems (ICPS). IEEE, 2019, pp. 647–652.
15. M. F. M. Jalali and H. Heidari, “Predicting changes in bitcoin priceusing grey system theory,”Financial Innovation, vol. 6, no. 1, pp.1–12, 2020.
16. M. A. Nasir, T. L. D. Huynh, S. P. Nguyen, and D. Duong, “Fore-casting cryptocurrency returns and volume using search engines,”Financial Innovation, vol. 5, no. 1, p. 2, 2019.
17. A. P. Motamed and B. Bahrak, “Quantitative analysis of cryptocur-rencies transaction graph,”Applied Network Science, vol. 4, no. 1, pp.1–21, 2019.
18. Y.-Y. Hsieh, J.-P. Vergne, P. Anderson, K. Lakhani, and M. Reitzig,“Bitcoin and the rise of decentralized autonomous organizations,”Journal of Organization Design, vol. 7, no. 1, p. 14, 2018.
19. D. D. F. Maesa, A. Marino, and L. Ricci, “The bow tie structure ofthe bitcoin users graph,”Applied Network Science, vol. 4, no. 1, p. 56,2019.
20. M. Jun, “Blockchain government-a next form of infrastructure for thetwenty-first century,”Journal of Open Innovation: Technology, Market,and Complexity, vol. 4, no. 1, p. 7, 2018.
21. F. Parino, M. G. Beiró, and L. Gauvin, “Analysis of the bitcoinblockchain: socio-economic factors behind the adoption,”EPJ DataScience, vol. 7, no. 1, p. 38, 2018.
22. J. Taskinsoy, “Blockchain: A misunderstood digital revolution. thingsyou need to know about blockchain,”Things You Need to Know aboutBlockchain (October 8, 2019), 2019.
23. F. Hammad, “Is bitcoin mining halal? investigating the sharia compli-ance of bitcoin mining,” in2018 International Conference on Inno-vation and Intelligence for Informatics, Computing, and Technologies(3ICT). IEEE, 2018, pp. 1–4.
24. G. Pappalardo, T. Di Matteo, G. Caldarelli, and T. Aste, “Blockchaininefficiency in the bitcoin peers network,”EPJ Data Science, vol. 7,no. 1, p. 30, 2018.
25. J. Clay, A. Hargrave, and R. Sridhar, “A power analysis of cryptocur-rency mining: A mobile device perspective,” in2018 16th AnnualConference on Privacy, Security and Trust (PST).IEEE, 2018, pp.1–5.