An Overview of Blockchain Technology: Architecture, Consensus Algorithm, and Its Challenges

Abstract

Blockchain technology is a public ledger which is factually needed in distributed system that records all transactions or digital events that have be executed sharable among participating parties in distributed network. Each transaction is verified by consensus algorithm techniques and allow for transfer records in participating network. Once information is entered it can never be altered or erased. Thus, blockchain contains definitive and verified records of every single record. Consensus algorithm plays a vital role in blockchain technology, which decides the agreement about each transaction and append new block in transaction according to agreement. Bitcoin is a first emerging technology which firstly blockchain technology. Bitcoin is a decentralized, peer-to-peer digital cryptocurrency. However, this digital currency is controversial technology in which blockchain technology work flawlessly and widely used in both financial and nonfinancial applications. The reason behind uses of blockchain technology is its security, anonymity, its central attributes, and data integrity without any interference of third party. This chapter presents an extensive overview of blockchain technology with 22 its consensus algorithm. This chapter also compares some typical consensus algorithm used in blockchain. Furthermore, some technical challenges and functional requirements, and some possible future trends are briefly listed.