BLOCKCHAIN: TECHNOLOGY FRAMEWORK, THE REGULATION, AND POLICIES. Introduction
Blockchain is a public ledger that is distributed and decentralized technology that is used to keep record behind the Bitcoin network. It is a sort of block information that is stored in a public database.The development of Blockchain technology has prefigured as an advancement that will enable significant changes and transformation of the operations of organizations and business transactions in the future. The emergency of rapid new technological innovations, most organizations, and businesses that use blockchain have realized significant benefits by using this technology to enhance their operations. The blockchain contains a series of blocks that help to record information in a crucial function with a timestamp, and the blocks are linked to one another. It contains distributed ledgers, where the information collected is stored in different nodes. The distributed ledgers decentralize information appropriately to prevent them from vulnerable attacks from cybercriminals who can destroy them. Its technology framework allows the storage of information safely, and it is not subjected to vulnerabilities like unexpected changes or manipulations or even being used to create tokens which can be conveyed from one party to the other without the use of an intermediary or trusted third party or also automation of complete smart contracts when particular terms and conditions are to be followed.
Hughes, L., Dwivedi, Y. K., Misra, S. K., Rana, N. P., Raghavan, V., &Akella, V. (2019). Blockchain research, practice, and policy: Applications, benefits, limitations, emerging research themes, and research agenda. International Journal of Information Management, 49, 114-129. Retrieved from:https://bradscholars.brad.ac.uk/handle/10454/17473
This article mentioned that the use of blockchain technology has increased, and it is still increasing at a high rate, especially across various sectors of industries like logistics, manufacturing, public services, and, more importantly, on financial services.The authors identified that cryptocurrency is the most common association, which are virtual currency tokens present in their blockchain, thus representing the asset of utility. However, the tokens are used in utility tokens, cryptocurrencies, and investment tokens. The adoption of the blockchainentails the use of the distributed ledger that creates the base on how data is collected and conveyed between the users. The authors coincided that the distributed ledgers not only allow the users to understand how the database is stored but also to know how it is used, manipulated, and the benefits gained from it. In this case, the concept of smart contracts emerges, which is very crucial among users. The smart contract stipulates the rules, regulations and the penalties in an agreement and it removes and enforces obligations in a contract automatically.. Don't use plagiarised sources.Get your custom essay just from $11/page
Crosby, M., Pattanayak, P., Verma, S., &Kalyanaraman, V. (2016). Blockchain technology: Beyond bitcoin. Applied Innovation, 2(6-10), 71.
Even though technology is an aspect that cannot be regulated but sometimes it has to be regulated respective of the activity or business it is involved. Blockchain main point of use is in distributed ledger, smart contracts and cryptocurrencies. According to the authors of this article, all the three aspect are to be regulated but the crucial part is the cryptocurrencies that has created an alarm of regulations. They also suggested that the operation of the blockchain is regulated by government agencies like the Federal Trade Commission (FTC) and (SEC) who evaluates the business accordingly to meet the requirements of the laws. Sometimes, these agents may form new laws and regulation policies for the purpose of monitoring and regulating the industry for compliance reasons. But the laws and regulations impacts the growth and development of blockchain, it can either hinder or support it.
Cermeño, J. S. (2016). Blockchain in financial services: Regulatory landscape and future challenges for its commercial application. BBVA Research Paper, 16, 20.
According to the article written by Cermeño, for one to develop and implement blockchain, he/she must follow the regulations and policies so that it can be allowed to function. They include; providing the legal nature of the blockchain and their distributed ledgers, the blockchain must be recognized as indisputable, tamper-proof sources of truth, the right to be over and done, it should also have a legitimate validity of the information kept in the blockchain, financial instruments should be valid as well as the use of smart contracts should be enforced in action. However, for this blockchain technology to be implemented on a broad basis, the legislative laws that addresses various aspect including security of information are written or amended for the purpose of considering the nature of its operations.
Ølnes, S., Ubacht, J., & Janssen, M. (2017). Blockchain in government: Benefits and implications of distributed ledger technology for information sharing.
This article outlines the governing policies that control the implementation of the blockchain technology. The policies address policies that the market participants needs to put in place for appropriate governance. The authors advocated for correction mechanisms against blockchain technology, they should be subjected to laws in case they go beyond the stipulated regulation. Also, they should be guided by rules that rejects unwanted operations. Lastly, these governing policies should be made-to-order to the functions and nature of blockchain technologies.
References
Cermeño, J. S. (2016). Blockchain in financial services: Regulatory landscape and future challenges for its commercial application. BBVA Research Paper, 16, 20.
Crosby, M., Pattanayak, P., Verma, S., &Kalyanaraman, V. (2016). Blockchain technology: Beyond bitcoin. Applied Innovation, 2(6-10), 71.
Hughes, L., Dwivedi, Y. K., Misra, S. K., Rana, N. P., Raghavan, V., &Akella, V. (2019). Blockchain research, practice and policy: Applications, benefits, limitations, emerging research themes and research agenda. International Journal of Information Management, 49, 114-129. Retrieved from: https://bradscholars.brad.ac.uk/handle/10454/17473
Ølnes, S., Ubacht, J., & Janssen, M. (2017). Blockchain in government: Benefits and implications of distributed ledger technology for information sharing.