Introduction to blockchain
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This document provides an overview of blockchain technology, highlighting its immutable and distributed ledger characteristics, initial applications in cryptocurrencies, and evolving uses across various industries. It details specific applications for micro, small, and medium enterprises (MSMEs) including trade finance, supply chain management, and contract automation, emphasizing the benefits of increased efficiency, trust, and security. The document also dispels common myths about blockchain and introduces new products leveraging this technology.
Introduction to blockchain
- 1. Introduction to Blockchain and applications for MSMEs
- 2. What is a Blockchain • A Blockchain is fundamentally an immutable, distributed ledger. • A mathematical structure for storing data in a way that is nearly impossible to fake. It can be used for all kinds of valuable data. • Using a Blockchain, participants can transfer value as simply as sending an SMS, entirely peer to peer without the need for a central party to confirm the validity of the transaction. • The first implementation of blockchain was in Bitcoin, where every “node” in the network has a copy of the ledger, and “miners” solve a cryptographic puzzle to arrive at a single source of truth. Reduced, time, increased data security, low transaction costs.
- 3. History of Blockchain 2009 Satoshi nakamoto invents Bitcoin 2011-13 Transactions: Copies of Bitcoin emerged like Litecoin. 1990-early 2000 Distributed computing 2004 Bit-Torrent, a trial of blockchain backed gold currency e- gold 2014-15 Contracts: smart contract platform Ethereum invented, consortium R3 was formed by banks 2015-17 Hyperledger invented for creation of only private blockchains 2016-18 Applications development across use cases 2019 onward Widespread blockchain adoption across industries
- 4. What is a Blockchain
- 5. Types of Blockchains Data Identity Crypto- currency Smart contracts Security (scale of 1-5) Speed Scalability Costs Public Accessible to everyone anonymous Most of the time yes Most of the time yes 5 3 3 Very very low transaction costs Private Only accessible to the participants Revealed to all participants No yes 3 5 5 Depends on the context Hybrid Certain data is public pseudonymo us Sometimes yes yes 4 4 4 Low transaction costs Common Blockchain platforms:
- 6. Why use a Blockchain Trust and Traceability: • Blockchain enables “automated trust”, sharing sensitive data and seeing who has viewed, and who has modified the data. This enables full traceability. Contract management: • Blockchain smart contracts enable automation of record keeping and record sharing. • This means no more hundreds of pages of manual contracts, no more reconciliation of invoices/goods receivables, no more manual signatures. Data sharing: • Data stored on a Blockchain cannot be tampered or changed. • Digital certificates, digital signatures, tracing the history of a product before purchasing – all of this can be done on a Blockchain based platform.
- 7. Why use a Blockchain
- 8. Where are Blockchains used • Land records: Storing land records on a blockchain greatly reduces time, effort, and costs involved in land transactions. • Payments and billing: All inter-government department payments, invoicing, and contracts can be done on a smart contract based platform. • Trade: Trade finance for verified goods and managing free zone contracts. • Security: Police departments can use blockchain to securely share information across departments. Whatsapp/facebook are not secure systems to share sensitive data. • Healthcare: Citizen healthcare records and transactions on a secure blockchain platform with specified access controls. • Logistics: Traceability of products coming into the municipality, and tracing produce from farm to folk, tracing minerals up till export. • Citizen benefits: Giving out citizen benefits, insurance, schemes all on a single platform enabling full trust and transparency. Automating insurance claims, schemes using smart contracts. • Certificates: Issuing birth, death, quality, metric based certificates on a blockchain platform ensures no chances of counterfeiting.
- 10. Who are the major players in Blockchain ecosystem
- 11. How can you implement Blockchain • Setting up the blockchain: Setting up number of nodes, block generation time, hosting on cloud or on-site. • User roles and permissions: Setting up user roles for different nodes and participants in the system • Smart contracts: Creating smart contracts on the blockchain for specific applications such as tracing a product from source to shelf on a supply chain. • Securing key management: Creating a safe place for storing private keys that are used to sign transactions on a blockchain. • Deployment: Deploying the blockchain across the departments that are going to be the users of the blockchain.
- 12. Applications of Blockchain for MSMEs Trade finance: • The trade finance ecosystem is heavily dominated by paper processing with multiple participants along the transaction lifecycle. Time taken for transactions, costs for each transaction, and issues of data security plague international trade. • With rising costs and operational risk, the industry has been seeking solutions to simplify, better manage, and digitize trade, making it ripe for the benefits of blockchain technology. Supply chain financing: • Financing invoices, financing against inventory, financing against goods receivables are major problems for MSMEs. Blockchain can reduce time to verify invoices and inventory through combining Blockchain traceability with Goods Receivables, POs, invoices. • Knowing the authenticity of the product location data + product quality + supplier credentials can greatly help in speeding up the process of supply chain financing.
- 13. Applications of Blockchain for MSMEs Contract management: • Blockchain can be used to create, check and enforce contracts between users, would be suppliers, clients, and customers. • Whether it be invoicing, settling interest fees, creating insurance policies, handling fulfilment of inventory, smart contracts can make the contracting process much more efficient, especially if there are more than two parties involved in a transaction. Traceability: • Tracing a product across the supply chain is paramount to ensure on-time payments, product quality, and timely deliveries. • Traceability is required at every level, from product imaging, videos showing products being loaded, products monitored using sensors.
- 14. Applications of Blockchain for MSMEs Loyalty points: • Retailers can give out brand specific and retail specific loyalty points to customers. Customers can then trade these points on a secondary market, which leads to additional marketing for the product. Copyright and IP: • Potential copyright of a hardware or software product can be created on a blockchain smart contract, with tracking of who has used, with payments happening directly over the blockchain. - https://techcrunch.com/2019/06/06/is-there-potential-for-blockchain-in- copyright-and-licensing-applications/ Data sharing: • Share your customers’ data securely. More recently, with MeitY in India launching a challenge to create a zoom alternative, a Blockchain is perfect to facilitate a p2p version of zoom with no data privacy issues.
- 15. Applications of Blockchain for MSMEs Warranty management: • Warranty of products can be tracked, and a digital clone of the product can be created on Blockchain. • Easy warranty based redemption of the product, with smart contracts between the retailers, dealers, the OEM would provide high efficiency in the reverse supply chain. Supply chain financing + traceability + contract management + payments + warranty management = e-commerce platform for all SMEs across India - https://www.sentinelassam.com/business/niti-aayog-weighs-integrating-all-smes-on-e- commerce-platforms/.
- 16. Applications of Blockchain Matrix Fields of work Trade finance Supply chain financing Contract management Traceability Loyalty points Restaurants Retail Traders Travel/tourism Hospitality
- 17. Applications of Blockchain for Matrix Fields of work Trade finance Supply chain financing Contract management Traceability Loyalty points warranty management Copyright and IP Data sharing Software development Creative arts Automobile manufacturing Healthcare equipment manufacturing Real estate
- 18. Our products SHINE – Traceability for the Metals industry: • A Blockchain traceability solution for the forward supply chain to track any product from source to shelf. SHINE is also a real time audit solution for the reverse supply chain to enable audit of the recycling process for plastics and metals. Sheo – a Neobank on Blockchain: • We are launching a Blockchain powered NeoBank that can be easily integrated with any bank’s infrastructure to provide a fully rounded financial experience for SME’s and startups. Sheo combines the simplicity of e-commerce with the security of trusted banks and Blockchain to provide a new banking experience for SMEs, startups, and individuals. Murmur – Detect fake news through AI and Blockchain: • A platform to detect fake news on social media. We have created a browser extension as well as an app that helps people detect fake news. We use Blockchain technology to trace the origin of a news item, and we use AI for our model to learn based on user feedback. https://www.youtube.com/watch?v=hTnImAIadoE
- 19. Our products Fields of work Sheo – Neobank on Blockchain SHINE - supply chain traceability Murmur – secure data sharing Retail, F&B Traders Digital content/social media Manufacturing Hospitality
- 20. Busting Blockchain myths Blockchains consume large amounts of power. Answer: Only public blockchains based on a proof of work mechanism consume a lot of power, eg: Bitcoin. Private Blockchain platforms are in fact much more economical than traditional systems because the extra security of traditional system is not needed since Blockchain is already secure. Blockchain databases become too large and difficult to scale. Answer: In a private Blockchain setting, Blockchains are highly scalable at a fraction of the cost of a traditional database since they do not need any complex security systems. Blockchains are slow. Answer: Blockchain is a fast growing technology, with latest public blockchain transaction speeds hitting upto 4000tps.
- 22. Thank you