itmBusinessSchool

Digitizing Cross-Border Trade Processes using Blockchain Technology

Viral Patel

1 min

The webinar started with basics of blockchain technology and what is major use it and most important how it is needful in today’s world of trade processing. The following students from finance specialization attended the event: -

  • Shivam Khare (Warren Buffett)
  • Charvi Raviraj Shetty (Nitin Nohria)
  • Pratit Shrestha (Warren Buffett)
  • Anuja Priti (Warren Buffett)
  • Aditi Goenka (Warren Buffett)
  • Shruti S Nair (Warren Buffett)
  • Shivansh (Warren Buffett)
  • Antaryami Chinnara (Warren Buffett)
  • Mohit Periwal (Warren Buffett)

FEATURES OF BLOCKCHAIN

From the technical point of view, blockchain technology has four features: decentralization, traceability, immutability, and currency properties.

Decentralization refers to the processes of data verification, storage, maintenance, and transmission on blockchain which are based on a distributed system structure.

Traceability means that all transactions on blockchain are arranged in chronological order, and a block is connected with two adjacent blocks by the cryptographic hash function. Therefore, every transaction is trackable by examining the block information linked by hash keys.

There are two reasons that blockchain technology is immutable. On the one hand, all transactions are stored in blocks with one hash key linking from the previous block and one hash key pointing to the next block. Tampering with any transaction would result in different hash values and would thus be detected by all the other nodes running precisely the same validation algorithm. On the other hand, blockchain is a shareable public ledger stored on thousands of node, and all ledgers continue to sync in real time. Successful tampering would need to change over 51% of the ledgers stored in the network.

Blockchain technology and cryptocurrency are inseparable, that is to say, any blockchain network has a form cryptocurrency property. The essence of blockchain technology is point-to-point transactions, no third party is involved, which means that all transactions do not require the participation of third parties. Circulation of digital currency based on blockchain technology is fixed. Specifically, in Bitcoin, the currency base is set at 21 million caps, so the generation of digital currency is created by using a specific mining algorithm and is bounded by a pre-defined formula.

PROS AND CONS Pros

  • Improved accuracy by removing human involvement in verification
  • Cost reductions by eliminating third-party verification
  • Decentralization makes it harder to tamper with
  • Transactions are secure, private and efficient
  • Transparent technology

Cons

  • Significant technology cost associated with mining bitcoin
  • Low transactions per second
  • History of use in illicit activities
  • Susceptibility to being hacked