IEEE Consumer Electronics Magazine - July 2018 - 13

APPLICATIONS AND USE CASES
The blockchain has the capacity to revolutionize the security,
stability, and transparency of networks in need, provided it is
applied appropriately and only if necessary, because it is not
a panacea for all security applications. Figure 8 shows some
of the areas where it finds application and is currently being
used, owing to its advantages.

Popular Applications of
the Blockchain
Real Estate
Finance
Asset Management

ASSET MANAGEMENT
This area is all about securely transferring assets within a business network. An asset could be a physical one, such as a server, computer, or a laptop, or an intangible one, such as software
and services. The blockchain offers shared ledger capability,
which means full visibility from end to end in a business network. The blockchain is employed right from serialization to
deployment on the floor and focuses on only five key events,
i.e., manufacturing serialization of assets to initiate the blockchain, receiving and validation of assets, asset capitalization,
warranty activation, and installation of the asset.

REAL ESTATE
Transactions in real estate are cumbersome, opaque, and expensive, mainly because of the involvement of the various middlemen, such as brokers, government property databases, title
companies, escrow companies, inspectors, appraisers, and
notaries public. The blockchain enables every property,
everywhere, to have a corresponding digital address that contains occupancy, finance, legal, building performance, and
physical attributes that conveys perpetually and maintains all
historical transactions.

Weddings
Health Care
IoT
FIGURE 8. Some blockchain applications.

ASSISTING WEDDINGS
It is possible to search for a bride or groom online and then
physically meet and get to know each other and finally make
commitments, ultimately involving a marriage. Now this entire
end-to-end process can be done online, right from finding
someone to purchasing the wedding gifts. The first couple to
do this was Joyce and David Mondrus in 2014 [21].

HEALTH CARE
A blockchain-based management of patients' health records
was proposed in [22]. In this scenario, a person's medical history is stored in a decentralized system, accessible to the
treating doctors and medical insurance providers.

CHALLENGES
FINANCE
International money transfer is a highly important process
that becomes quite expensive and sluggish because of the
presence of unnecessary middlemen. It takes several banks
(and currencies) before the money can be collected. Services
that are faster, such as Western Union, can be used, but they
are also expensive. The blockchain can speed up and simplify
this process, cutting out the unnecessary middlemen. At the
same time, it makes money remittance more affordable. Until
now, the costs of remittance were 5-20%. The blockchain
reduces the costs to 2-3% of the total amount and provides
guaranteed, real-time transactions across borders.

THE IoT
IoT solutions using blockchain can be built to maintain a
continuously growing list of cryptographically secured data
records protected against alteration and modification. For
instance, an IoT-connected (e.g., through radio-frequency
identification) asset with sensitive location and temperature
information could be tracked as it moves along various points
in a warehouse or in a smart home [18]. This information
could be updated on a blockchain, permitting all involved
parties to share data and the status of the package as it moves
among different gatherings to guarantee that the terms of an
agreement are met [19], [20].

Despite its capabilities and benefits, the blockchain has a few disadvantages, the most serious being the scalability problem. The
consensus and block validation require the presence of the entire
blockchain, i.e., all of the transactions that ever happened, thus demanding a great deal of storage. The restriction of the block size
contributes to the scalability issue in a major way. With the limitation of a 1-MB block size and the delayed consensus process, only
six to seven transactions are confirmed in a second, with high
transaction fees. Increasing the size of the blocks would create an
additional delay by decelerating block propagation.
To achieve security with reduced block size, a new version of
blockchain called Bitcoin-NG was proposed [23], which divides
the block into two parts to reduce the propagating size. Forks in
typical blockchain networks cause further delay while the nodes
await the longest version to confirm the correct blockchain.
Another issue with the blockchain is what is called the 51% attack
problem. This arises if more than 51% of the nodes collude to
generate fake blocks or reverse confirmed transactions. Since
greater computation power leads to quicker block generation, genuine nodes would not be able to compete for a fair version of the
blockchain, as nodes would believe only the longest version.
An additional challenge of the blockchain is the power or
energy requirement [24]. It is estimated that the mining of
1 BTC requires the energy equivalent to two years' consumption
of a typical U.S. household. It is also estimated that energy
july 2018

IEEE Consumer Electronics Magazine

Table of Contents for the Digital Edition of IEEE Consumer Electronics Magazine - July 2018