Blockchain for Real World Applications

2 Distributed Ledger Technology

The concept of Distributed Ledger Technology (DLT) encompasses how cryptography and an open distributed ledger can be integrated into a digital business. DLT refers to the technical infrastructure and protocols that allow simultaneous access, verification, and updating of records in an irreversible manner over a network spanning multiple entities or locations. It could be a blockchain, Directed Acyclic Graph, Hashgraph, Holochain, or Tempo (Garg, 2017).

2.1 Different Types of Distributed Ledger Technology

2.1.1 Blockchain

Blockchain is a type of DLT where transaction records are saved, in the ledger, as a chain of blocks. All the nodes maintain a common ledger, so the overall computational power gets distributed among them, which delivers a better outcome.

• Enhanced Security: Every single data is deeply encrypted (hashed) that allows a higher level of security. It renders hacking impossible.
• Faster Disbursement: Relatively faster than typical payment systems, although bigger networks may have slower transaction rates.
• Consensus: Supports a wide range of consensus algorithms that help the nodes to make the right decision.

Once a transaction takes place, the nodes on the network verify it. After verification, the transaction gets a unique hash ID and gets stored in the ledger. Once it gets added to the ledger, no one can mutate or delete the transaction.

2.1.2 Directed Acyclic Graph

Every transaction is entered on the ledger in a sequential ...