A Novel Block Chain Technology

Abstract

In today's connected and integrated world, economic activity takes place in business networks that span national, geographic, and jurisdictional boundaries. Business networks typically come together at marketplaces where the participants, such as producers, consumers, suppliers, partners, market makers/enablers, and other stakeholders own, control, and exercise their rights, privileges, and entitlements on objects of value known as assets. Assets can be tangible and physical, such as cars,

homes, or strawberries, or intangible and virtual, such as deeds, patents, and stock certificates. Asset ownership and transfers are the transactions that create value in a business network. Transactions typically involve various participants like buyers, sellers, and intermediaries (such as banks, auditors, or notaries) whose business agreements and contracts are recorded in ledgers. A business typically uses multiple ledgers to keep track of asset ownership and asset transfers between participants in its various

lines of businesses. Ledgers are the systems of record (SORs) for a business's economic activities and interests. A distributed ledger is a type of database that is shared, replicated, and synchronized among the members of a network.

          The distributed ledger records the transactions, such as the exchange of assets or data, among the participants in the network. Participants in the network govern and agree by consensus on the updates to the records in the ledger. No central, third-party mediator, such as a financial institution or clearinghouse, is involved. Every record in the distributed ledger has a timestamp and unique cryptographic signature, thus making the ledger an auditable history of all transactions in the network. One implementation of distributed ledger technology is the open source hyper ledger Fabric block chain.Current business ledgers in use today are deficient in many ways. They are inefficient, costly, non- transparent, and subject to fraud and misuse. These problems stem from reliance on centralized, trust-based, third-party systems, such as financial institutions, clearinghouses, and other mediators of existing institutional arrangements. These centralized, trust-based ledger systems lead to bottlenecks and slowdowns of transaction settlements. Lack of transparency, as well as susceptibility to corruption and fraud, lead to disputes. Having to resolve disputes and possibly reverse transactions or provide insurance for transactions is costly. These risks and uncertainties contribute to missed business opportunities. Furthermore, out-of- sync copies of business ledgers on each network participant’s own systems lead to faulty business decisions made on temporary, incorrect data. At best, the ability to make a fully informed decision is delayed while differing copies of the ledgers are resolved.