How to Implement Blockchain?

Blockchain is a technology that can be difficult to describe, but it’s changing the world. And while many people will tell you they don’t understand blockchain, some simpler explanations can help you wrap your head around this new system.

This post aims to do just that: break down what blockchain is and how it works, so you can better appreciate this innovative new tech. We’ll start with a brief overview of cryptography and Bitcoin for context before walking through the major concepts involved in the blockchain itself.

What is Blockchain?

A blockchain is a distributed database of information. Like a traditional database, it comprises records grouped into “blocks.” Individual blocks cannot be modified once they’ve been added to the chain, and all transactions are recorded on this chain as they happen.

This chain is also decentralized, which means any central authority doesn’t maintain it: each computer on the network keeps track of its transactions.

This system can create a permanent, public record for anything that needs it. As a public ledger, the blockchain allows everyone with access to the network to view all of the transactions that take place, which is why it’s so well suited for financial applications.

It could also be used to store information about land titles and intellectual property: in the future, this could even be used for voting systems and online identity management.

In addition to their use in financial transactions, blockchains are considered for various other application fields. Even though there are generic blockchains that can be adapted to particular use cases, the implementations of these blockchains are frequently cumbersome and difficult to personalize.

This article discusses blockchain technology’s fundamental ideas and investigates a real-world use case in the energy sector. Specifically, we look at a scenario where customers trade portions of their photovoltaic power plants using a blockchain.

Not only does this use blockchain technology, but it also necessitates user interaction. As a result, a completely bespoke, permissioned, and private blockchain is built from the ground up.

We conduct analysis and justify the need for blockchain technology within the context of this use case, as well as discuss the properties desired for the system.

Then, we provide an in-depth description of the implementation and the insights we gained. This serves as a guide for others and illustrates the possible opportunities and pitfalls involved in developing a blockchain from the ground up.

Steps Involved In Blockchain Implementation

1. Identify the use case:

One must first understand the market to identify a use case for blockchain. There are many markets in which blockchain technology can be applied, including financial and supply chain management.

One way to assess the market is by identifying use cases involving consistent data exchange among parties. Another approach is to look for areas where a structured database may be difficult to maintain.

For example, if a private database requires an outside provider to mediate the database interactions, the system may need to be more robust. Blockchain technology can be used in these scenarios to create a more robust, tamper-proof database that needs no outside provider. Identify requirements:

After identifying the type of market and use case, identify and capture all requirements. This includes everything from defining the project’s scope to detailing how an end-user’s experience should be. One of the challenges with implementing a blockchain is that there are various protocols within it.

Depending on the desired functionality, the implementation may require slight variations in the protocol. For example, suppose a blockchain is being built for public use and interaction. In that case, it’s best to select a protocol that supports Bitcoin or another cryptocurrency (e.g., Ethereum) rather than one for private use.

2. Create a proof of concept:

After the requirements are defined, develop a proof of concept. The proof of concept can be a simple prototype or an early-stage implementation that simulates the use case.

For example, developers can write code in an easily reversible programming language that mimics the end-user experience on a blockchain platform instead of using Turing complete code that is irreversible and difficult to correct.

After the proof of concept is in place, subject it to extensive testing to confirm that it meets the requirements. Capturing all of the requirements for a project is crucial for ensuring that all possible problems are identified and fixed during development.

3. Perform risk analysis:

After the proof of concept stage has been completed, perform business and technical risk analyses on the implementation. This will allow the development team to identify pitfalls and develop mitigations in advance.

This can also be a good time to perform a proof of value analysis, which involves using the proof of concept to ensure that the end-user experience is as desired before completing the project.

4. Develop a set of guidelines:

After the risk analysis is complete, develop guidelines that can be used in all future development processes. This is typically a requirement for integrations with third-party software systems or companies using the blockchain platform.

This can also include privacy and end-user experience guidelines and general rules for development and testing. These guidelines will be followed by the entire development process and serve as a guide for all future developers working on the project.

5. Create a prototype:

After the guidelines are developed, develop a prototype. Most importantly, this is an opportunity for developers to learn from the experience and avoid pitfalls identified and fixed in the previous phase. The prototype could be a simple application or simulate all the use case’s aspects.

6. Test the prototype:

After the prototype is developed, it should be put through rigorous testing. All end users should be able to use the prototype without major issues, including any security risks. The focus of testing should be to ensure that all program features meet or exceed expectations.

The initial implementation will likely consist of many interconnected components, including frontend and backend systems, each of which requires thorough testing.

This is an opportunity for all stakeholders to provide feedback on the user experience and any additional desired features not initially identified in the requirements.

7. Choose the blockchain platform:

After the prototype is complete, select a blockchain platform. This cannot be easy because many platforms are available, and each has different features and costs. After you’ve identified the platform that best meets your needs, proceed to the implementation stage.

  • The potential rate of growth of the business can be determined using Ethereum.
  • Quorum removes the possibility of fraudulent data manipulation in commercial transactions.
  • Hyperledger Fabric is a platform that enables businesses to develop their private blockchain applications.
  • Stellar is responsible for the development of applications for various businesses and organizations.
  • Corda enables users to conduct transactions directly through secure smart contracts.
  • Open chain: maximizes the effectiveness of the management of all aspects of a company’s human resources
  • Multichain: improves the efficiency of professional-level work involving human resources

When selecting a blockchain platform, it is important to determine whether or not the company’s technical team is well-organized and whether or not the platform has an open-source station. Additionally, the system ought to be within your price range.

The difficult step that follows a successful proof of concept and comes before full-scale implementation is one that businesses and governments alike face. As a result, it is essential to take into account the following factors:

  • A better understanding of the technology on the part of business leaders is currently being pursued.
  • Developing a plan and a direction for the implementation of blockchain technology
  • Having engagement with regulators to establish clarity and stability, among other things
  • This reassurance will help to make it possible to realize the tangible benefits that were promised.

8. Choose the right consensus protocol:

After the blockchain platform has been selected, the project can move forward, and the consensus protocol used in the production implementation should be selected.

After the protocol type has been determined, you must choose an implementation for your proof of concept or production system. Proof-of-concept implementations typically consist of a single application, usually a custom build of an existing blockchain platform. In this case, there are many factors to consider when choosing a blockchain platform.

9. Build an ecosystem:

After the blockchain platform has been finalized, a team of developers needs to be assembled, and an ecosystem created. The ecosystem should consist of frontend and backend applications. Most importantly, it should include a set of integrated APIs that enable communication between the various components of the software.

10. Develop the application:

Next, develop the application using one or more programming languages. This can be done by directly modifying the blockchain platform or creating a custom implementation based on one of the existing protocols.

11. Determine rules of engagement:

After the application is developed, a configuration file must be created for future development. The configuration file will determine the rules of engagement for each component in the software and how they communicate. Consult this information as you work toward full-scale implementation.

12. Consider privacy implications:

When implementing the blockchain platform, remember that the data on which it relies for the system will be visible to other app users. This means that a threat actor or a hacker could compromise your whole system and that all data contained in your business applications will be subject to attacks.

13. Monitor evolving regulation:

It is important to know that some countries are much more relaxed about using blockchain technology than others. While some countries have yet to enact legislation, others have clear regulations.

Conclusion:

After all of the above has been considered, you should be able to create a full-scale blockchain system, which will have many benefits. You can maintain control over your data and establish a customer product or service. You will also be able to manage human resources and implement trust transparently and optimally.

The technology is still new, with no clear regulatory framework. In addition, some governments are still resisting the development of blockchain technology.

Blockchain technology is based on the belief that data is valuable. And every company has its supply of data, some of which are highly sensitive and valuable. The result is that a business or government will want to keep them safe from intruders and hackers who are always looking for vulnerabilities and ways to get in.

In its simplest form, blockchain technology allows for a secure transaction between two or more parties, each with its basis of trust.

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