Blockchain Structure, Data Distribution and validation ~ Best We Want

The Structure of Blockchain

According to IBM, blockchain is a shared, distributed ledger that facilitates the process of recording transactions and tracking assets in a network. The asset may be a tangible asset like property, house, vehicle or an intangible asset like digital currency, intellectual property rights, etc. Basically, it stores Data, and records its movements in a distributed environment..

Let’s look into its details.

It is a distributed database or a public registry that keeps details of assets and its movements/transactions across a P2P(peer to peer) network. Each transaction will be secured through cryptography and later all the transaction history will be grouped and stored as blocks of data. Then the blocks are linked together with cryptography and secured from modification.

The whole process will create an unforgivable, and immutable record of the transactions that happened across the network. Additionally, this blocks of records are copied to every participating computer in the network, so everyone will have access to it. The great advantage of blockchain is that it can store any kind of asset, its ownership details, history of the ownership and location of assets in the network.

The powerful feature of Blockchain is that we can create a shared reality across non-trusting entities. That is all of these participating nodes in the network do not need to know each other or trust each other because each has the ability to monitor and validate chain for themselves. The strong point is that the mutual distrust among participant is the thing which keeps the blockchain secure and verified.

Data Structure of Blockchain

The data in blockchain is stored as individual blocks, that’s why it is called Blockchain. Just like a linked list, the Blockchain is a collection of blocks linked together. So what does the block actually contain? Each block in a blockchain will have the following fields.

From the above figure we note that

1) Data: Stores the data

2) Previous hash: Stores the hash of the previous block

3) Hash: Hash value for the current block which can be used to refer this block

The actual data (like transaction details, asset details etc.) are stored in this field. Previous hash will store the hash values of the previous block (consider it as a link to the previous block), the blocks are connected through this value.

Data Distribution in Blockchain

The blockchain has its own unique Data storage structure. The data distribution in a blockchain has also a different approach.

Server based model
P2P Network model

In P2P network the data is stored in all the participant nodes in the network. All the individual nodes will have the copy of the entire ‘Blocks’ and a single change in a particular block will be updated in all the nodes.

But here is the problem, in Client-Server model the data is stored in DB after verification of a central authority; but in P2P network there is no central authority, then how does the authenticity of data assured? The answer is the validation process and consensus mechanism of the blockchain network.

Block Validation

Blockchain validation is simply the process of finding the block hash. In a blockchain, all the blocks are added to the blockchain after validation only. Whenever a transaction takes place in the blockchain it will be added to a block; sometimes one transaction per block and sometimes several transactions per block. It depends on the block size and the nature of the network. When a transaction is added to the block, it must undergo a validation process before it is being added to the blockchain as a valid block.

Block Validators

Block validators are the nodes which participates in the process of block validation. Different blockchain protocols adopt different methodologies for selecting the validator from available pool of nodes.

Some of the methods are described below.

1)PoW (Proof of Work)

In PoW, the mining challenge is open to all. All the miners compete each other to add the next block. A fixed reward is given to the miner who finds the solution first. In fact, the node with more computational power usually wins the race. Bitcoin uses the PoW algorithm.

2) PoS (Proof of Stake)

Here, the validators are chosen based on the fraction of coins they own in the system. The nodes with more number of coins have more chance to be selected than the node with lesser number of coins. In PoS the reward is in the form of transaction fee, new coins are not created for paying the validators.

3) POA( Proof of Activity)

PoA is a hybrid approach and it is introduced to overcome some of the problems in PoS and PoW. In this method, the mining begins with PoW and at some point the process is switched PoS.

4) PoET(Proof of Elapsed Time)

In this method, the network uses a lottery functions for implementing consensus. A lottery algorithm is used for finding the leaders from a set of nodes. So the validators are selected randomly from the pool. Hyperledger Sawtooth blockchain uses PoET method. .

5) POB (Proof of Burn)

In this method, the aspiring validators increase their stake in the system by sending their coins to an irretrievable location (thus the name burn). The validators are selected randomly, but those who has more stake in the system has high probability to get selected. Over the time the earned stake decays and the nodes has to burn more currency to increase their stake. The only coin that uses proof of burn mechanism is slimcoin.

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Blockchain Structure, Data Distribution and validation