The report introduces the disruptive and transforming concepts of blockchain technology, the different visions and models of governance, the impact of decentralization, the importance of consensus algorithms, and the way privacy and security are guaranteed in blockchain. The document includes concepts and foundations of blockchain, its governance, and its characteristics. It also explains how the decentralized autonomous organizations (DAO) work.
The report analyzes how blockchain technology affects security, scalability and decentralization, and the implications of each of these three characteristics in a blockchain net. The decentralization of a blockchain consists in the suppression of a central figure of authority. To substitute this figure, the decentralized nets use consensus mechanisms that guarantee the compliance of the rules established in the consensus algorithms.
Regarding consensus algorithms, the report reflects on the decentralized level introduced in the consensus mechanisms. It is explained how important these consensuses are, explaining how important it is to reach an agreement without interference or malicious actions by third parties. The main algorithms and how they function are explained: tolerance to practical Byzantine faults, Proof of Work (PoW), Proof-of-Stake (PoS), among others.
The last part of the report focuses on privacy and anonymity within blockchain with a brief explanation of how blockchain and the General Data Protection Regulation interact and an introduction to the privacy guarantees in blockchain thanks to the Zero Knowledge Proof implementation.
Read the complete report here
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