Blockchain Applications - PDF

Network application

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
CONCLUSION................................................................................................................................2
TASK 2............................................................................................................................................3
REFERENCES..............................................................................................................................14

INTRODUCTION
Blockchain contains a set of records, data and information that are linked together in form of
cryptography. It is designed in such a way that data is modified during transaction between two
parties. A blockchain is used for managing data over distributed network. It is used to connect
data packets with chain that enables in transmitting it. The report will describe about two
blockchain applications working model, purpose, scalability issues, features and weakness.
TASK 1
Field and purpose of application
Bitcoin is a peer to peer blockchain of electronic transfer of cash without involving any
financial institution. It is completely related to finance field. Bitcoin is digital wallet from where
transaction are done [1]. The purpose of bitcoin is to establish a decentralised peer to peer
payment network and is like cash for internet.
Whereas libra is decentralised blockchain that support in low volatility cryptocurrency.
Libra blockchain is used in financial transaction. Its purpose is to be used in cross border
payment and money transfer.
Working model of application
A bitcoin works on basis of public key. When a user sends bitcoin to someone the
transaction details are published along with public key a network. Then, the info is verified other
computer in network through digital signature. So, after confirmation transaction is added into
blockchain. In this way each block is added into chain and in bitcoin transfer.
The working model of libra is still not confirmed but in libra money is deposited into
bank account and is backed up by either dollar or euro. The bank holding libra will generate
interest. This will enable in making things easy and allowing it to deal in financial transaction.
Scalability issues
There are many issues occurring in bitcoin. First is the scalability issue is its processing
capacity is limited by average block creation of 10 times and block size of 1 megabyte. Also,
transaction time limit is only 3.3 to 7 per second. So, these issues constrain the network and
blockchain [2].
In libra scalability issue is that it is not open network so any person will not be able to
trade in it. Also, participation in libra is limited and only libra association members are allowed
to provide approval. So, due to this trading as well as transfer of currency is difficult.
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Features and weakness of application
Bitcoin features
 It is easy to set up a bitcoin as there is no are no charges, credit checks, etc.
 It is a decentralised blockchain having autonomy administrating experts.
 The currency is transparent and anonymous.
 It is non repudiable that means if bitcoin is transferred to someone it can not be retained
back.
Weakness
 There is high threat of scam or fraud in bitcoin as there is no specific financial institution
involved [3].
 Due to its high price volatility bitcoin losses its market value to a great extent.
 There is no refund on bitcoin due to lack of standards or policy
Features of libra
 The currency is controlled by a group of companies with particular standards and
policies.
 There are physical offices of libra in Switzerland.
 It guarantees efficiency and is having a great control over network.
Weakness
 There are strict rules and regulations which are to be followed to trade in libra.
 Any change in technology will be a threat to investors and states [4].
Socio technical aspect
The main aspect of bitcoin is with advancement in technology there are many countries
such as Africa and Brazil where societies are still not using bitcoin. Moreover, there is lack of
trust among people regarding use of bitcoin.
Libra is yet to be launched so its socio technical aspect is poor countries people will not
be able to engage with it. Furthermore, many countries are not having advance IT infrastructure
that supports in trading libra.
CONCLUSION
It can be summarised that bitcoin and libra are two cryptocurrency blockchain applications.
Theh both deal in exchange and transfer of currency in digital way. bitcoin working model is
based on public key whereas libra is on bank. In bitcoin scalability issue is its processing
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