How to Commence Your Blockchain Startup: Part Two
Step 1. Meet Blockchain
Blockchain is intended to make transactions safe and reliable even when the parties involved do not trust one another.
In 2008, the world was introduced to a new concept that many believe will revolutionise society as a whole. That’s the year when Bitcoin was invented—the first blockchain platform. More about it later. Now it’s vital to define the term.
There are various definitions of blockchain. The most common are as follows: Blockchain, at its core, is a peer-to-peer distributed ledger that is cryptographically secure, append-only, immutable (extremely hard to change), and updateable only via consensus or agreement among peers. Put simply, it is arranged in data batches called “blocks” that reference and identify previous blocks by a hashing function, forming an unbroken chain, hence the name. No one owns this database, so cheating the system by faking documents, transactions, and other information is nearly impossible.
Step 2. Know the Blockchain Features
Blockchain can perform a variety of functions. They define it among all its competitors. Knowing the technology’s strengths allows you to stand out in a crowd.
Distributed consensus is the major feature of a blockchain. No single authority is in charge of the database. This enables a blockchain to present a single version of truth that is agreed upon by all parties. For example, now you need banks to process your financial transactions. With blockchain, you don’t need them anymore. What luck!
Only verified transactions are selected for inclusion in a block. Verification is done according to a predetermined set of rules. security in everything!
Every transaction is unique. No duplicates are allowed, especially in cryptocurrencies. Have you ever come across a lot of duplicated information while googling? That’s how it can be solved!
Tokens carry value from one user to another. Only valuable information is allowed!
Cryptography means everything. Financial institutions and other industries need to maintain the privacy and confidentiality of transactions. It could be argued that in many situations, confidentiality is not really needed, and transparency is preferred instead. For example, in bitcoin, confidentiality is not really required; however, it is desirable in some scenarios. Only external means can provide data privacy in the blockchain. The blockchain itself is public.
Blockchain can generate cryptocurrency to reward miners who validate transactions and spend resources to secure the blockchain.But this is a whole other story.
Once you add records to the blockchain, they can’t be changed. There is the possibility of rolling back the changes, but this is considered almost impossible to do as it will require an unaffordable amount of computing resources. So, you need to be careful when you add information to it.
Platforms for Smart Contracts
Blockchain is a technology that some platforms are based on. Programs can run on such platforms as Bitcoin, Ethereum, etc.
Read Also: How to Commence your Blockchain Startup: Part One
You are in full control of your assets, which cannot be spent or owned twice. Well, truth be told, theoretically, there is such an opportunity. This is due to the possible branching of the blocks. There is a mechanism that regulates the issue. But it is an open question whether it works in 100% of cases or only in 99.9%.
One more thing: any value can be owned only by one wallet. including the smart contract wallet. A contract can be managed by several people. Thus, through a smart contract, you can share your property.
For example, a digital music file can now be copied many times without any control; on a blockchain, however, you can implement a scheme for transferring rights of use. And, if necessary, you can limit the time. That is, when you find a file with music, you can check whether you have the right to own a copy or not. Anyway, copyrights remain with their owners. if the author does not give them to anyone.
Smart contracts are automated, autonomous programmes that reside on the blockchain and encapsulate business logic and code in order to execute a required function when certain conditions are met. That is the desired future for all, but it is now only available to the jet set. Such contracts allow flexibility, programmability, and much-desired control over actions that users of blockchain need to perform according to their specific business requirements.
Check out an example of a smart contract on Github. This is an example of placing offers and selling some values (tokens) in the market at a certain price.
Step 3: Choose the Brightest Blockchain Platform
If you google “blockchain,” you will see a long list of different platforms that allow you to create unique apps with lots of benefits. But only two of them must have been mentioned. Wanna check?
But first, let’s figure out why we need these platforms. Decentralized applications run on top of a blockchain in a peer-to-peer network. They are software programmes that can run on their own blockchain, use another already established blockchain, or use only the protocols of an existing blockchain solution. Simply put, with pre-existing platforms, you do not need to create your own blockchain; instead, you must create your own application that will run on top of the platform.Well, it’s not so hard as it sounds!
Bitcoin is the first blockchain platform. Bitcoin introduced the first fully decentralized digital currency. Over time, it became obvious that it was extremely secure and stable. That was the start of a totally new revolution. Bitcoin has become very popular since its introduction in 2008. Moreover, now it is the most successful digital currency in the world with billions of dollars invested in it. It is built on decades of research in the fields of cryptography, digital cash, and distributed computing.
Vitalik Buterin founded Ethereum in November 2013. The key idea is the development of a Turing-complete language that allows the development of arbitrary programmes (smart contracts) for blockchain and decentralized applications. This is in contrast to bitcoin, where the scripting language is very limited and allows only basic and necessary operations.
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