The ethereum-based app builder has a dedicated team of experts looking at all varieties of fiat cash on distributed ledgers, and it's working with UnionBank of the Philippines to create a low-cost tokenized fiat solution for rural banking. In time, this could be extended to cover a larger network of banks and perhaps even the central bank, ConsenSys says.

Decentralization and distribution are seen by many to be a major benefit of public blockchains, but not everybody shares this ethos. But this is not the only benefit of public blockchains, of course. Perhaps most importantly, their transparency makes them very secure: because they can be audited by anybody, it is easy to detect fraud on the chain. Security-via-openness is a principle well known in the open source world, and this strategy is also popular among some in the digital currency community. For example, all of the tools and content produced by the Ethereum team is open source. This helps to make Ethereum widely accessible and more secure.

“Such brazen theft would indicate [1] that Bitcoin would be (in the near future) without sidechains of any kind, and [2] that Bitcoin itself may be in danger from the miners (and we may need to consider using an alternate proof-of-work hash function),” he explained the impact of this setup in his original post on the topic. Like SPV sidechains, drivechains require a soft-forking change to Bitcoin.
Because decentralization has been viewed by many as intrinsic to the revolutionary potential of blockchain, the point of private blockchains might be called into question. However, blockchains offer much more than a structure that accommodates decentralization. Among other features, their strong cryptography and auditability offers them more security than traditional protocols (although not bulletproof, as noted), and they allow for the development of new cryptocurrencies. Furthermore, voting platforms, accounting systems, and any type of data archive can arguably be optimized with blockchain technology. We are still in the early days of blockchain technology, and the power it has to reshape older systems has yet to be seen.
Sidechains with specific purposes could be formed with specific features while still enjoying the widespread adoption and value that Bitcoin holds.  Most importantly it can add these features without consensus from the Bitcoin community. Sidechains have the potential to replace many Cryptocurrencies as it allows features that were previously unique to these currencies to be available on Bitcoin. It also allows developers to experiment with sidechains and scope its full potential while still keeping coins linked to Bitcoin.
Blockstream believes that to be secure, blockchain systems must be built with open source technology. Towards that goal, we've created the Elements Project, a community of people extending and improving the Bitcoin codebase. As open source, protocol-level technology, developers can use Elements to extend the functionality of Bitcoin and explore new applications of the blockchain. Join the expanding group of individual and corporate developers using Elements to build robust, advanced, and innovative blockchains.
The cheapest and most simple option is doing calculations on your local network (off-chain) and integrating with main blockchain by sending the results. It has flaws; you cannot live full advantage of blockchain as we do in bitcoin, because you will still have existing constraints of your current system. Despite all this, it is still a valid option; perhaps you won't need all the features of blockchain technology. Perhaps it is just enough to use blockchain only for your pain points. Factom can be considered under that kind of option. They used bitcoin wisely in their design. They hold the actual mass data in their network and utilize stability of bitcoin in their solution. This project is so successful that at coindesk magazine, it is saying that Factom can be used for the land titles in Honduras. http://www.coindesk.com/debate-f...
It is different with a private blockchain (or closed) since the members of the network are selected before being able to download the protocol and therefore use the proposed service by the network. The mining capabilities and the system of consensus as a whole are centralized within the hands of the same entity. A network based on a private blockchain is therefore not decentralized in itself.
It’s the IBM “blockchain”. Basically Apache Kafka queue service, where they have modified the partitions. Each partition is an ordered, immutable sequence of messages which are continuously appended. They added some “nodes” to clean the inputs and voila; blockchain! We should add that there are no blocks, but batches of transactions are renamed to fit the hype better. Since everything gets written in one queue at the end of the day, IBM offers the bluemix cloud server (priced at 120.000$ per year) to host the service. Smaller test packages with a couple of input cleaning nodes go reportedly for 30.000$.

Sidechains with specific purposes could be formed with specific features while still enjoying the widespread adoption and value that Bitcoin holds.  Most importantly it can add these features without consensus from the Bitcoin community. Sidechains have the potential to replace many Cryptocurrencies as it allows features that were previously unique to these currencies to be available on Bitcoin. It also allows developers to experiment with sidechains and scope its full potential while still keeping coins linked to Bitcoin.
Blockstream has also released an “Alpha” sidechain with all of those features up and running except the last, coupled to the Bitcoin testnet. (Used for testing Bitcoin software without putting real value at risk.) In the absence of the Bitcoin protocol change that will cryptographically secure the programmatic transfer of value between Bitcoin and sidechains, they’re cooperating with several external organizations to perform and validate those transfers. If and when that protocol change happens, though, pegged sidechains will be as permissionless, and as decentralized, as Bitcoin itself.
Thus Tradle set out to build a meta-protocol that saves the data in the overlay network, and only puts minimal referencing data on the blockchain. There is a general grumpy consensus among bitcoin core devs and mining pool operators on allowing one small data chunk, a hash, per transaction. Many devs say it is not possible to secure this second overlay network. I agree, unless we use the blockchain to help with the task. We have a partial solution working, and are preparing a new design to improve it (partial, as it can not yet handle all known attacks). We are actively sharing the designs at various meetups (and on the github) and are inviting devs to find attack vectors and propose solutions. Tradle’s protocol not only relieves the pressure on bitcoin’s blockchain but is also able to handle larger transaction sizes than Counterparty and Mastercoin, so it can be used for complex identity, supply chain management and many other applications. It is also capable of handling attachment files, needed in the healthcare and financial industries.
Smart contracts are immutable pieces of code and their outcomes are irreversible. Hence, formal verification of their code is very important before deploying them. It’s very hard to verify smart contracts in the Ethereum Virtual Machine (EVM). A business can’t afford to deploy faulty but immutable smart contracts and suffer the consequences of their irreversible outcome. This article details the challanges: “Fundamental challenges with public blockchains”.
State of the art public Blockchain protocols based on Proof of Work (PoW) consensus algorithms are open source and not permissioned. Anyone can participate, without permission. (1) Anyone can download the code and start running a public node on their local device, validating transactions in the network, thus participating in the consensus process – the process for determining what blocks get added to the chain and what the current state is. (2) Anyone in the world can send transactions through the network and expect to see them included in the blockchain if they are valid. (3) Anyone can read transaction on the public block explorer. Transactions are transparent, but anonymous/pseudonumous.

Private blockchains, or as I like to call them, shared databases, have a place in improving efficiency for financial institution for back-office settlement processes. They should not be seen as controversial, or part of some dialectic struggle between punks and police. To the extent that the identifying shroud of AML/KYC can be placed into public blockchain metadata (possible in Omni Layer transactions over the Bitcoin blockchain) there may even be interoperability between these two sides of the train tracks. Right now, due to state-granted monopolies to issue credit, most of the world's liquidity is still in banks. However, we believe that in the long-term, public blockchains, especially those based on work, will come to take a more significant part in the ‘System D’ informal economy, which is where most of the global economic growth will originate.” 
External Account, which stores ETH balance – This contains the address of the User that was created using the Web3.js API, e,g, personal.newAccount(…). These accounts are used for executing smart contract transactions. ETH is your incentive received for using your account to mine transactions. The address of the account is the public key, and the password of the account is the private key.

Public blockchains are open, and therefore are likely to be used by very many entities and gain some network effects. To give a particular example, consider the case of domain name escrow. Currently, if A wants to sell a domain to B, there is the standard counterparty risk problem that needs to be resolved: if A sends first, B may not send the money, and if B sends first then A might not send the domain. To solve this problem, we have centralized escrow intermediaries, but these charge fees of three to six percent. However, if we have a domain name system on a blockchain, and a currency on the same blockchain, then we can cut costs to near-zero with a smart contract: A can send the domain to a program which immediately sends it to the first person to send the program money, and the program is trusted because it runs on a public blockchain. Note that in order for this to work efficiently, two completely heterogeneous asset classes from completely different industries must be on the same database - not a situation which can easily happen with private ledgers. Another similar example in this category is land registries and title insurance, although it is important to note that another route to interoperability is to have a private chain that the public chain can verify, btcrelay-style, and perform transactions cross-chain.
Sidechain transactions using a two-way peg effectively only allow for intra-chain transactions. A transfer from Bitcoin (parent chain) to Ethereum (sidechain) would allow a user to use the functionality of Ethereum (i.e., fully expressive smart contracts), but the underlying original asset would remain precisely that, Bitcoin. So, a Bitcoin on an Ethereum sidechain technically remains a Bitcoin.
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draglet is a German company founded in Munich 2013 and specializes in developing Blockchain Applications, Smart Contracts and Bitcoin/Cryptocurrency Exchange Software for businesses. The development team of draglet has been involved in the cryptocurrency world since its initial beginnings and possesses years of experience, providing companies with quality Blockchain applications on a global scale.    
Las sidechains son otro de los conceptos más famosos entorno a Bitcoin, no los pierdas de vista. La teoría indica que permitirían añadir funcionalidades nuevas a Bitcoin, pero sin necesidad de modificar constantemente el código de éste, ya que la funcionalidad es desarrollada utilizando otra cadena de bloque para finalmente ser conectada a la de Bitcoin. Al mismo tiempo esto evitaría la saturación de una sola cadena de bloques, como actualmente ocurre, al utilizar cadenas diferentes para cada caso de uso.
“Blockchain offers a possible solution to these challenges with its decentralized ledger that can store a history of transactions across a shared database,” Cohen said in the report. “By making the record accessible and verifiable from anywhere in the world, blockchain can enable the authentication of goods and eradicate the criminal element of counterfeit goods in the retail supply chain. By pairing hardware chips with blockchain technology, a product can take on a digital history, going as far back as the raw materials that were used to make the product. This allows retailers and consumers to verify their purchased products are genuine.”

State of the art public Blockchain protocols based on Proof of Work (PoW) consensus algorithms are open source and not permissioned. Anyone can participate, without permission. (1) Anyone can download the code and start running a public node on their local device, validating transactions in the network, thus participating in the consensus process – the process for determining what blocks get added to the chain and what the current state is. (2) Anyone in the world can send transactions through the network and expect to see them included in the blockchain if they are valid. (3) Anyone can read transaction on the public block explorer. Transactions are transparent, but anonymous/pseudonumous.


Instant Payments: Since the creation of Bitcoin there has been a race for faster transaction confirmations. Instant payments allow new use cases, such as retail store payments, and transactions in online games. RSK carefully chosen parameters and new theoretical protocols (such as DECOR+GHOST) allow creating blocks at 10 seconds average interval, with low stale block rate, and no additional centralization incentives.
Since 2008 when Satoshi Nakamoto published a white paper considering Bitcoin and blockchain technology, the latter gained fame as a tool for combating trust issues and bringing transparency to transactions between independent participants. Even though a decade passed, for a lay public, blockchain is still not the easiest concept to deal with. As a rule, people generalize things they don’t understand deeply in detail. Thus, when they hear “blockchain,” they tend to think there’s just one transcendental blockchain that hosts thousands of projects. But it’s a wrong perception as there are numerous blockchains and they differ.
Public blockchains are just that, public. Anyone that wants to read, write, or join a public blockchain can do so. Public chains are decentralized meaning no one body has control over the network, ensuring the data can’t be changed once validated on the blockchain. Simply meaning, anyone, anywhere, can use a public blockchain to input transactions and data as long as they are connected to the network.
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