What are blockchain APIs, and why are they important?

Blockchain APIs, or application programming interfaces, are software interfaces that allow developers to interact with a blockchain network. Users can query and manipulate blockchain data, including transactions, smart contracts and other blockchain assets, using the functions and protocols APIs offer.

For instance, APIs can supply developers access to the consensus algorithms that are utilized by blockchain networks, enabling them to test and optimize their blockchain applications by understanding how the network comes to a consensus on transactions and blocks. They can evaluate how well their applications work with various consensus techniques by simulating various network situations. This can assist developers in locating possible problems and resolving them before releasing their applications on the blockchain network itself.

Blockchain APIs are crucial because they allow programmers to build decentralized apps (DApps) that communicate with blockchain networks. By granting developers access to blockchain data and functionality, they are empowered to build applications that can execute transactions, store information, and execute smart contracts on the blockchain.

For instance, the Algorand API is a blockchain application programming interface that provides developers with access to the Algorand blockchain. It offers resources and tools to assist developers in creating and deploying DApps while enabling developers to create applications on the Algorand blockchain network.

Similarly, Coinbase API provides developers with access to the Coinbase platform, allowing them to create and manage digital wallets, query transaction data, and buy and sell cryptocurrencies.

Related: How to use Ganache for blockchain project development

How do blockchain APIs work?

Blockchain APIs work by allowing developers to interact with blockchain networks and access their data and functions through a standardized interface. Here are the steps involved in the working of blockchain APIs:

Choose a blockchain network

Developers must select the blockchain network with which they want to communicate. Bitcoin, Hyperledger and Ethereum are among the examples.

Identify the API endpoint

When choosing a blockchain network, developers must decide which API endpoint they will use to communicate with the network. An API endpoint is a URL that a developer can use to access a specific function or service offered by an API. The Ethereum network, for instance, offers a number of API endpoints, including Infura and Alchemy.

Infura offers a dependable and expandable API infrastructure for the Ethereum and IPFS networks, whereas Alchemy provides a similar service for several blockchain networks, including Polygon, Ethereum and BNB Smart Chain. Both services supply developers access to a variety of features and services, such as blockchain data querying, smart contract interaction and transaction administration.

Authenticate API access

Developers must use the necessary credentials or tokens to authenticate their access to the API endpoint. As a result, the blockchain network can be accessed safely and legally.

Send API requests

Following authentication, developers can use the API endpoint to send API requests to the blockchain network. Sending transactions to the network, requesting information from the network and carrying out smart contracts are all examples of API queries.

Receive API responses

A blockchain network will reply to an API request by giving data or a confirmation of the activity taken. For instance, asking the Bitcoin network about a wallet’s balance will reveal the wallet’s balance.

The transaction and wallet data on a blockchain network is often public and can be linked back to the user, which can raise privacy concerns. To help protect user data, many blockchain networks have implemented privacy safeguards, including encryption and anonymity. 

Developers should also take precautions to ensure the security and privacy of their users’ data by putting robust authentication and authorization restrictions, data encryption and other security practices into place.

Analyze and utilize API data

After receiving an API response, developers can examine and make use of the data in accordance with their requirements. For instance, the API response developers receive could include information about the current state of the smart contract, such as its balance or the values of its variables. Then, a developer creating a DApp can alter the program’s state using the API response.

This kind of interaction with an API is necessary for building sophisticated apps that make use of external data sources or network resources. It enables programmers to create complex programs that may respond to current events and offer their customers individualized experiences.

Types of blockchain APIs

There are several types of blockchain APIs available, each designed to serve a specific purpose within the blockchain ecosystem. The common types of blockchain APIs are explained in the sub-sections below. However, depending on the blockchain network and use case, there may be other types of APIs available as well.

Node API

Access to a node on a blockchain network is made possible by a node API. Developers can submit transactions to the network and get data from the node, including transactions and blocks. To create decentralized applications and communicate with the blockchain network, node APIs are generally employed.

Smart contract API

Smart contracts are self-executing contracts that have the terms of the contract stated in lines of code. A smart contract API provides access to smart contracts on a blockchain network. It allows developers to create, deploy and execute smart contracts, as well as interact with them. Smart contract APIs are typically used to build DApps that require smart contract functionality, such as decentralized finance (DeFi) applications

Wallet API

With the help of a wallet API, developers can control Bitcoin transactions by having access to a blockchain wallet. It enables users to monitor transaction history, transmit and receive cryptocurrencies, and check wallet balances. Applications that require cryptocurrency payments, including e-commerce platforms, are frequently built using wallet APIs.

Market data API

Real-time market data for cryptocurrencies and other digital assets is accessible through a market data API. It can be used to get market parameters such as trade volumes, trade prices and other metrics. Building applications that need real-time market information, such as trading platforms, often uses market data application programming interfaces.

Identity API

A blockchain network’s identification API offers a mechanism to confirm the users’ identities. It can be applied to numerous blockchain applications to manage digital identities and verify users. Identity APIs are frequently used to create applications, like online voting systems, that demand user authentication and verification.

How are DApps created using blockchain APIs?

DApps are created using blockchain APIs by leveraging the unique properties of blockchain technology, such as decentralization, immutability and transparency, to build applications that can operate in a trustless environment without intermediaries. The steps to create DApps using blockchain APIs are explained below.

Retrieving blockchain data

Retrieving data from the blockchain is the first step in using a blockchain API. This can include information about transactions, blocks, addresses and more. Developers can submit HTTP queries with particular parameters to the endpoint of the blockchain API to get data, and they will receive responses in JSON format.

JSON stands for JavaScript Object Notation. It is a lightweight format for storing and exchanging data between different applications. It is based on a subset of the JavaScript programming language and is easy for both humans and machines to read and write.

Because JSON is a text-based format that web browsers and other applications can easily parse and interpret, it is frequently used for data transmission between a server and a web application.

Parsing and processing data

Once data is retrieved from the blockchain, it needs to be parsed and processed to be useful. Decoding transactional data, confirming digital signatures and other tasks may be involved.
Depending on the documentation for the blockchain API, developers can analyze and process the data using programming languages like JavaScript, Python or Go.

Building smart contracts

Developers can create smart contracts at this stage by utilizing blockchain application programming interfaces and programming languages like Solidity or Vyper. The blockchain API can be used to deploy the smart contract to the blockchain network after it has been created.

In order to do this, a transaction must be created that contains the smart contract’s bytecode as well as any other data necessary for the transaction. Bytecode is a low-level representation of code that can be executed by a computer’s virtual machine, often used in the context of programming languages that compile to bytecode instead of machine code.

A private key that corresponds to a public address on the blockchain network must be used to sign the transaction. The blockchain API can be used to broadcast the transaction to the network once it has been signed.

The network will examine the transaction and, if it is legitimate, will process it before deploying the smart contract to the blockchain. After being launched, the smart contract can run its code on the blockchain network and communicate with other network nodes.

Sending transactions

Transactions can also be sent to the blockchain network using blockchain APIs. This step includes sending cryptocurrency, making changes to smart contracts or carrying out other blockchain operations. The blockchain API allows developers to sign transactions with their private keys, broadcast them to the network, and get confirmation that they were successfully executed.

Creating blockchain applications

Finally, DApps that operate on the blockchain network can be built using blockchain APIs. Blockchain APIs allow programmers to establish smart contracts, retrieve, process and store data on the blockchain, as well as interface with other blockchain network nodes to develop robust and safe applications. This step involves combining the previous steps to create a functional and secure DApp.

Revolutionizing blockchain development with decentralized APIs (dAPIs)

For decentralized applications, it is critical to access the range of services that web APIs offer, from providing asset price data to executing conventional financial transactions. However, intermediary-based interfacing solutions prevalent today are centralized, not secure and expensive. This is where decentralized APIs, or dAPIs, play a key role.

DAPIs use decentralized infrastructure to eliminate the issues mentioned above. By leveraging blockchain technology, dAPIs offer a secure, decentralized way for applications to access data and services without relying on a centralized server. This means that dAPIs are securer, more scalable and more cost-effective than traditional APIs.

However, dAPIs should not be confused with Chainlink as it uses a decentralized network of nodes, called Chainlink nodes, to retrieve data from external sources and feed it into smart contracts. The nodes are incentivized to provide accurate and reliable data through a system of reputation scores and financial incentives. 

On the other hand, API3 uses Airnode to build, manage and monetize dAPIs at scale. Airnode is a Web3 middleware and the Web3 oracle solution for the API economy to connect any web API directly to any blockchain application. A decentralized API is a collection of APIs that resemble real-world business services, connected to the blockchain via middleware. These APIs are consolidated into a single oracle service that can be accessed by users on the blockchain. The governance of the dAPI is decentralized, ensuring transparent oversight of the resulting service. 

Therefore, while Chainlink is a decentralized oracle service that provides smart contracts with external data, API3 focuses on building decentralized APIs that provide high-quality data feeds directly to dApps without the need for a middleman. This approach enables dApps to access and integrate real-world data in a secure and efficient manner, while also minimizing the risk of data manipulation or tampering.

How to choose the right blockchain API

Choosing the right blockchain API depends on several factors, including the project requirements, the blockchain platform being used, and the API provider’s features and pricing. A few considerations when choosing a blockchain API are listed below:

• Blockchain platform: Choose an API that is appropriate for your chosen blockchain platform. Look for an Ethereum-specific API, for instance, if you are building on Ethereum.
• Data retrieval: Consider the types of data that the API can retrieve and how it can be accessed. Make sure the API can return the data one requires in an accessible way.
• Security: Search for an API that places a high priority on encryption, allows for safe access and has defenses in place against hackers and other online risks.
• Scalability: One should confirm that the API can support their project’s size. Take into account the API’s capacity for requests, response speed and handling large amounts of data.
• Support and documentation: Choose an API with thorough developer support and documentation. Look for tools that can assist one in resolving problems and making the most of the API, such as tutorials, code samples and developer communities.
• Pricing: Lastly, take into account the API’s pricing plan and how it works with your project budget. While some APIs have set subscription costs or transaction fees, others have free tiers or usage-based pricing.

By considering these factors and evaluating different blockchain API providers, developers can choose the right API that fits their project requirements and budget.

Benefits of using blockchain APIs

Using blockchain APIs can provide numerous benefits to developers and businesses that are leveraging blockchain technology. For instance, blockchain application programming interfaces can make dealing with the blockchain much simpler, which makes it straightforward for developers to create blockchain-based apps. A lot of the complexity associated with blockchain technology is abstracted away through APIs, which offer a straightforward and standardized way to communicate with the blockchain.

Blockchain APIs can also supply users access to a plethora of data that has been saved on the blockchain. This information can be used to develop new business models, automate procedures and enable trustless transactions. Businesses can learn a lot about their operations and customer behavior by utilizing the data provided by blockchain application programming interfaces.

In addition, blockchain APIs can assist companies and programmers in ensuring the integrity and security of their applications. Systems that are secure and impervious to tampering that can guard against fraud and other types of harmful behavior can be built using the transparency and immutability of the blockchain.

Finally, blockchain APIs can assist companies and developers in keeping abreast of the most latest trends and advancements in the blockchain sector. Businesses may access the most latest research and industry best practices by utilizing the knowledge of blockchain API providers, which will assist them to stay on top of trends and remain competitive.

Challenges of implementing blockchain APIs

Although blockchain APIs have many advantages, implementing them might be difficult. The intricacy of blockchain technology itself, which can be challenging for developers to understand and work with, is one of the major obstacles. Longer development delays and higher expenses may follow from this.

The lack of standardization among various blockchain networks and application programming interfaces is another difficulty. As a result, in order to create applications that can communicate with various blockchain networks, developers may need to become familiar with and proficient with a variety of APIs.

Also, a strong infrastructure is needed for the successful operation of blockchain application programming interfaces, including a secure database, fast internet and dependable servers. Implementing blockchain APIs may become more expensive and challenging as a result of these constraints.

The regulatory environment that surrounds blockchain technology is another difficulty. Blockchain application legality differs greatly between nations and regions, which might lead to ambiguity and impede adoption.

Finally, while using blockchain APIs, data security and privacy are major issues. Sensitive data may be disclosed or compromised since blockchain technology is transparent and decentralized. To ensure that data is transmitted and stored safely and that only authorized parties have access to it, developers must take extra security measures.

Related: How Web3 resolves fundamental problems in Web2

The future of blockchain APIs

The future of blockchain APIs looks promising as more businesses and developers recognize the benefits of blockchain technology. As the use of blockchain continues to grow and evolve, so will the demand for blockchain APIs to support these new use cases.

Integration of blockchain APIs with other cutting-edge technologies, such as the Internet of Things (IoT) and artificial intelligence (AI), represents one possible area for growth. Developers may build robust and secure apps that take advantage of the benefits of both blockchain and IoT/AI by merging both technologies.

The development of cross-chain interoperability protocols, which enable communication between various blockchains, is another area of development. This will open up new options for businesses and developers by fostering greater collaboration and innovation across various blockchain platforms. 

Band Protocol is a platform that aggregates and connects real-world data and APIs to smart contracts across different blockchain networks. Similarly, ChainAPI's integration platform enables API providers to make their APIs compatible with blockchain technology. These developments signify the beginning of an exciting and transformative era for both blockchain and API ecosystems.

One may anticipate seeing more standardization in the creation and application of blockchain protocols as the demand for blockchain APIs increases. Businesses will find it simpler to embrace blockchain technology as a result, and various blockchain platforms will become more interoperable.

Finally, one can anticipate that the development of blockchain application programming interfaces will place a greater emphasis on privacy and security. Blockchain APIs must offer strong security features to secure sensitive data and stop unwanted access as data breaches and cyberattacks increase in frequency and sophistication.

Understanding the layers of the blockchain

If you've looked into cryptocurrencies or blockchain in any way, you've probably come across terms like layer one and layer two protocols. Are you curious about what these layers are and why they exist? Let's discuss blockchain layer architecture in this article.

Blockchain technology is a one-of-a-kind mix of several current technologies — cryptography, game theory and so on — with a wide range of possible applications such as cryptocurrencies. Encoding and decoding data is a mathematical and computational discipline known as cryptography. The study of the mathematical models of strategic interaction among rational decision-makers is known as game theory. Blockchain eliminates intermediaries, lowers costs and improves efficiency by bringing transparency and security.

Without the oversight of a central authority, distributed ledger technology (DLT) keeps information Checked by cryptography among a group of users who agreed through a predetermined network protocol. Combining these technologies fosters trust between people or parties who would otherwise have no motive to do so. They make it possible for blockchain networks to exchange value and data between users securely.

Due to the lack of a centralized authority, blockchains must be very safe. They must also be extremely scalable to handle increasing users, transactions and other data. Layers were born out of the requirement for scalability concurrent to the preservation of top-notch security.

What is blockchain scalability?

The phrase "scaling" in blockchain technology refers to an increase in the system throughput rate, which is measured in transactions per second. With the widespread adoption of cryptocurrencies in everyday life, blockchain layers are now required to Strengthen network security, recordkeeping and other functions.

The number of transactions handled by a system per second is referred to as "throughput." While Visa's VisaNet electronic payment network can process over 20,000 transactions per second, Bitcoin's (BTC) main chain cannot handle more than seven transactions per second.

The blockchain is the first layer in a decentralized ecosystem. Layer two is a third-party integration used in conjunction with layer one to enhance the number of nodes and, as a result, system throughput. Many layer two blockchain technologies are currently being implemented. Smart contracts are used in these solutions to automate transactions.

Blockchain developers are attempting to broaden the scope of blockchain management as Bitcoin becomes a more significant force in the commercial world. They hope to reduce processing times and increase TPS by developing blockchain layers and optimizing layer two scalability.

The blockchain trilemma

The blockchain trilemma refers to the commonly held notion that, in terms of decentralization, security and scalability, decentralized networks can only provide two of the three benefits at any given time.

Computer scientists devised the consistency, availability and partition tolerance (CAP) theorem in the 1980s to express possibly the most significant of these difficulties. The CAP theorem states that decentralized data storage, such as blockchain, can only satisfy two of the three guarantees mentioned above simultaneously.

This theorem has evolved into the blockchain trilemma in the context of the current distributed networks. The widely held notion is that public blockchain infrastructure must sacrifice security, decentralization or scalability.

As a result, the holy grail of blockchain technology is to create a network with impenetrable security over a broadly decentralized network while also handling internet-scale transactional throughput.

Before delving into the trilemma's dynamics, let's define scalability, security and decentralization in general terms:

• The blockchain's scalability refers to its ability to handle a higher volume of transactions.

• Security refers to the ability to secure data on the blockchain from various types of assaults and the blockchain's defense against double-spending.

• Decentralization is a type of network redundancy that ensures that the network is not controlled by fewer entities.

The interplay among scalability, security and decentralization

To settle a transaction, the network must first agree on its validity. The agreement may take some time if the system has a large number of members. As a result, they can show that scalability is inversely proportional to decentralization when security parameters are identical.

Now, assuming that two proof-of-work blockchains have the same degree of decentralization and consider security to be the blockchain's hash rate. The confirmation time decreases as the hash rate rises, and scalability rises as security improves. As a result, scalability and security are proportionate with constant decentralization.

As a result, a blockchain cannot optimize for all three desired features simultaneously, forcing it to make trade-offs. Ethereum is the most latest example of the trilemma in action. The Ethereum platform has seen a boom in usage due to the growth of decentralized finance (DeFi) applications this summer. Ethereum can only grow to a certain point. 

Due to the increased demand, transaction fees have risen to the point where some people cannot engage with the blockchain. Increased Ethereum fees are an example of the trilemma, as they can see that Ethereum did not scale without sacrificing security or decentralization.

The focus of Ethereum was on decentralization and security, with the number of transactions per second being limited (scalability). To encourage miners to prioritize their transactions, users paid higher fees. Similarly, decentralization and security have taken precedence over scalability in Bitcoin.

It's no secret that the scalability of blockchains like Bitcoin and Ethereum is currently limited. Therefore, a global community of start-ups, corporations and technologists is working frantically on layer one and layer two solutions to solve the blockchain trilemma. 

Layer one blockchain networks are designed for speed, security and expansion. Layer two refers to technology enhancements and products that can be utilized to expand the scalability of existing blockchain networks. Getting the perfect balance between the two layers might be a game-changer for blockchain adoption and the expansion of decentralized networks.

Developers are approaching the issue from a variety of perspectives. The increased block size in Bitcoin Cash (BCH) was an attempt to Strengthen Bitcoin's scalability. However, there is no evidence that it is becoming more popular. 

Bitcoin is seeking to tackle the problem by adding a layer to the existing blockchain layer. The layer two solutions will bundle numerous transactions together and only query the base layer blockchain once in a while, according to the idea behind scaling solutions. Ethereum is taking a hybrid approach, with sharding scaling the base layer blockchain and the community anticipating several layer two solutions to boost throughput even further.

The layered structure of the blockchain architecture

In the case of blockchain architecture's distributed network, each network participant maintains, authorizes and updates new entries. A collection of blocks with transactions in a specific order represents the structure of blockchain technology. These lists can be saved as a flat file (in txt format) or a simple database. Blockchain architecture can take public, private or consortium forms.

The layered architecture of blockchain is categorized into six layers.

Hardware infrastructure layer 

The blockchain's content is stored on a server in a data center somewhere on this lovely globe. Clients request content or data from application servers while browsing the web or utilizing any apps, which is known as the client-server architecture.

Clients can now connect with peer clients and share data. A peer-to-peer (P2P) network is a large group of computers that share data. Blockchain is a peer-to-peer network of computers that computes, validates and records transactions in an orderly manner in a shared ledger. As a result, a distributed database is created, storing all data, transactions and other pertinent data. A node is a computer in a P2P network.

Data layer

A blockchain's data structure is expressed as a linked list of blocks in which transactions are ordered. The data structure of the blockchain consists of two fundamental elements: pointers and a linked list. A linked list is a list of chained blocks with data and pointers to the previous block. 

Pointers are variables that refer to the position of another variable, and a linked list is a list of chained blocks with data and pointers to the previous block. The Merkle tree is a binary tree of hashes. Each block contains the root hash of the Merkle tree and information like the preceding block's hash, timestamp, nonce, block version number and current difficulty goal. 

For blockchain systems, a Merkle tree provides security, integrity and irrefutability. The blockchain system is built on Merkle trees, cryptography and consensus algorithms. Because it is the first in the chain, the genesis block, i.e., the first block, does not contain the pointer. 

To protect the security and integrity of the data contained in blockchain, transactions are digitally signed. A private key is used to sign transactions, and anyone with the public key may verify the signer. The digital signature detects information manipulation. Because the data that is encrypted is also signed, digital signatures ensure unity. As a result, any manipulation will render the signature invalid.

The data cannot be discovered because it is encrypted. It cannot be tampered with again, even if it is caught. The sender's or owner's identity is also protected by a digital signature. As a result, a signature is legally linked to its owner and cannot be disregarded.

Network layer

The network layer, commonly referred to as the P2P layer, is responsible for inter-node communication. Discovery, transactions and block propagation are all handled by the network layer. Propagation layer is another name for this layer. 

This P2P layer ensures that nodes can find one other and interact, disseminate and synchronize to keep the blockchain network in a legitimate state. A P2P network is a computer network in which nodes are distributed and share the workload of the network to achieve a common purpose. The blockchain's transactions are carried out by nodes.

Consensus layer

The consensus layer is essential for blockchain platforms to exist. The consensus layer is the most necessary and critical layer in any blockchain, whether it is Ethereum, Hyperledger or another. The consensus layer is in charge of validating the blocks, ordering them and guaranteeing that everyone agrees. 

Application layer

Smart contracts, chaincode and decentralized applications (DApps) make up the application layer. The application layer protocols are further subdivided into the application and the execution layers. The application layer comprises the programs that end-users utilize to communicate with the blockchain network. Scripts, application programming interfaces (APIs), user interfaces and frameworks are all part of it.

The blockchain network serves as the back-end technology for these applications, and they communicate with it via APIs. Smart contracts, underlying rules and chaincode are all part of the execution layer. 

Although a transaction moves from the application layer to the execution layer, it is validated and executed at the semantic layer. Applications supply instructions to the execution layer, which executes transactions and ensures the blockchain's deterministic nature.

Blockchain layers explained

Layer 0

Blockchain layer zero is made up of components that help to make blockchain a reality. It's the technology that allows Bitcoin, Ethereum, and other blockchain networks to function. Layer 0 components include the internet, hardware, and connections that will enable layer one to run smoothly.

Layer one 

This is the foundation layer, and its security is based on its immutability. The Ethereum network, or layer one, is what people allude to when they say Ethereum. This layer is in charge of consensus processes, programming languages, block time, dispute resolution, and the rules and parameters that maintain a blockchain network's basic functionality. It is also known as the implementation layer. Bitcoin is an example of a layer one blockchain.

Problems with layer one

These scaling solutions boost the network's throughput when used together. However, with the growing number of blockchain users, layer one appears to be falling short. The archaic and clumsy proof-of-work consensus process is still in use on the layer one blockchain.

While this approach is more secure than others, it is limited by its speed. Miners are required to solve cryptographic algorithms using computational power. As a result, more computational power and time are required in the long run. Also, the workload on layer one blockchain has increased as the number of users has grown. Processing speeds and capacities have slowed as a result.

Possible solutions

Proof-of-stake is an alternate consensus that Ethereum 2.0 will adopt. This consensus approach certifies new transaction data blocks based on the staking collateral of network participants, resulting in a more efficient procedure.

Sharding is a scaling solution for the burden on the layer one blockchain problem. Simply said, sharding divides the task of validating and authenticating transactions into smaller, easier-to-manage chunks. As a result, the workload can be distributed over the network to use more nodes' computing capability. Because the network processes these shards in parallel, several transactions can be processed both sequentially and simultaneously.

Layer two 

The overlapping networks that sit on top of the base layer are known as L2 solutions. Protocols make use of layer two to increase scalability by removing some interactions from the base layer. As a result, smart contracts on the primary blockchain protocol only deal with deposits and withdrawals and ensure that off-chain transactions follow the regulations. Bitcoin's Lightning Network is an example of a layer two blockchain.

So, what is the difference between layer one and layer two blockchain? The blockchain is the first layer in a decentralized ecosystem. Layer two is a third-party integration used in conjunction with layer one to enhance the number of nodes and, as a result, system throughput. Many layer two blockchain technologies are being implemented at present.

Layer two scaling solutions

Layer two protocols have exploded in popularity in latest years, and they're proving to be the most effective approach to solving scaling issues in PoW networks, in particular. Various layer two scaling solutions are explained in the sections below.

Nested blockchain

A nested layer two blockchain runs on top of another. In essence, layer one establishes the settings, whereas layer two conducts the procedures. On a single mainchain, there might be several blockchain tiers. Consider it a typical business structure. 

Rather than having one person (e.g., the manager) conduct all of the work, the manager delegated tasks to subordinates, who then reported back to the management when they were finished. As a result, the manager's workload is reduced while scalability is improved. The OMG Plasma Project, for example, works as a level two blockchain for Ethereum's level one protocol, allowing for cheaper and faster transactions.

State channels

A state channel improves total transaction capacity and speed by facilitating two-way communication between a blockchain and off-chain transactional channels via various approaches. To validate a transaction over a state channel, the miner does not need to be involved right away.

Instead, it's a network-adjacent resource that's protected via a multi-signature or smart contract mechanism. The ultimate "state" of the "channel" and all its inherent transitions are posted to the underlying blockchain when a transaction or batch of transactions is completed on a state channel. 

State channels examples include Bitcoin Lightning and Ethereum's Raiden Network. In the trilemma tradeoff, state channels supply up some decentralization in exchange for increased scalability.

Sidechains

A sidechain is a transactional chain that runs alongside the blockchain and is used for massive bulk transactions. Sidechains have their consensus method, which can be adjusted for speed and scalability, and a utility token is frequently utilized as a part of the data transfer mechanism between side and main chains. The main chain's principal function is to provide general security and dispute resolution.

In several important ways, sidechains differ from state channels. To begin with, sidechain transactions are not private between participants; instead, they are published openly on the ledger. Furthermore, security breaches on sidechains do not affect the mainchain or other sidechains. Building a sidechain from the ground up necessitates a significant amount of time and work.

Rollups

Rollups are layer two blockchain scaling solutions that perform transactions outside of the layer one network and then upload the data from the transactions to the layer two blockchain. Layer one can keep rollups secure because the data is on the base layer.

Users benefit from rollups since they help to boost transaction throughput, open participation and lower gas costs.

Layer three 

The application layer is often referred to as layer three or L3. The L3 projects act as a user interface while masking the technical aspects of the communication channel. L3 applications are what supply blockchains their real-world applicability, as explained in the layered structure of the blockchain architecture.

Can the blockchain trilemma be solved?

The issues faced by distributed data storage, from which blockchains arose, were passed down to blockchains. To better comprehend these difficulties and related problems, the term "blockchain trilemma" was coined to group them.

Even though the word "trilemma" has remained, the blockchain trilemma is merely a conjecture. This hypothesis is suspected to be accurate based on early data, but it has been neither proved nor disproved. More research needs to be done, even though layer one and layer two solutions have already had some success.

The bottom line

One of the reasons why crypto mainstream adoption is now impossible in the blockchain business is scalability. As the demand for cryptocurrencies grows, so will the pressure to expand blockchain protocols. Because both blockchain levels have their own set of restrictions, the eventual solution will be to develop a system that can solve the scalability trilemma.

Layer one is critical since it serves as the foundation for decentralized systems. The underlying blockchain's scalability issues are addressed via layer two protocols. Unfortunately, most layer three protocols (DApps) currently run only on layer one, bypassing layer two. It's no surprise that these systems aren't performing as well as we'd want.

Layer three applications are essential because they help to develop real-world use cases for blockchains. They will, however, not capture nearly as much value as their foundation blockchain, in contrast to legacy networks.

Blockchain has the potential to become an integral part of their future. Essentially, it's a decentralized digital ledger that's secured by cryptography and boasts transparency that's unparalleled in any digital platform. Though initially linked to cryptocurrency, the technology has since seen various applications beyond Bitcoin.

Blockchain networks are employed in the financial sector, in universal basic income (UBI) programs, and even for humanitarian purposes. A number of institutions have begun investing in research and development of other blockchain-based applications, exploring its potential use in various transaction-based industries. Indeed, the technology has the potential to be as disruptive as the internet itself.

IBM saw that potential when it introduced IBM Blockchain last year. The goal of that public cloud service was to supply customers the means to build secure blockchain networks. On Sunday, IBM launched its own "Blockchain as a Service," and it's the first enterprise-ready implementation of IBM Blockchain.

The blockchain is based on The Linux Foundation's open source Hyperledger Fabric. "Think of it as an operating system for marketplaces, data-sharing networks, micro-currencies, and decentralized digital communities," explains Hyperledger on its website. "It has the potential to vastly reduce the cost and complexity of getting things done in the real world."

Through Hyperledger, IBM is offering a set of cloud-based services to help customers create, deploy, and manage blockchain networks, according to Jerry Cuomo, VP of blockchain technology at IBM. “Some time ago, they and several other members of the industry came to view that there needs to be a group looking after, governing, and shepherding technology around blockchain for serious business,” he told TechCrunch.

Though open source, Hyperledger promises to be secure and safe. "Only an Open Source, collaborative software development approach can ensure the transparency, longevity, interoperability, and support required to bring blockchain technologies forward to mainstream commercial adoption," they explained. "That is what Hyperledger is about – communities of software developers building blockchain frameworks and platforms."

To satisfy enterprise users, IBM adds another layer of security services using the IBM cloud. The computing giant also claims that their blockchain network is built around a highly auditable way of tracking all activity. This gives administrators a trail they can follow in case something goes wrong, like in the unlikely event that the network could be breached.

IBM's vision for blockchain isn't just limited to enterprise use. In 2015, IBM and Samsung presented a proof-of-concept for a blockchain-based, decentralized Internet of Things (IoT) called Autonomous Decentralized Peer-to-Peer Telemetry (ADEPT). It's a testament to just how much potential blockchain has. Ultimately, the technology puts digital security and transparency on a whole new level, one that we'll need as they push further into a future of extreme connectivity.

Six out of ten pharma companies are using or experimenting with blockchain, according to a new study.

According to the not-for-profit organisation The Pistoia Alliance, 60% of pharmaceutical and life science professionals are either using or experimenting with blockchain today, compared to 22% when asked in 2017.

However, 40% are not currently looking at implementing, or have no plans to implement blockchain, according to the survey of 170 senior pharma and life science professionals this year.

The biggest barriers identified to adoption are access to skilled blockchain personnel (55%), and that blockchain is too difficult to understand (16%).

These factors underline why The Pistoia Alliance is calling for the life science and pharmaceutical industries to collaborate over the development and implementation of blockchain.

Blockchain is an open, distributed ledger of information that is saved across several different servers, and is constantly growing as computers cryptographically discover the next “block” of information in the chain.

Data is protected in any given block as they cannot be altered retroactively without alteration of blocks, requiring consensus of the majority of the network.

Famously employed to administer the bitcoin cryptocurrency, blockchain can be used to create a secure repository for sensitive healthcare information such as clinical trial data.

The survey showed life science and pharmaceutical professionals are becoming more aware of the capabilities of blockchain.

Respondents believed the greatest opportunities for using blockchain lie in the medical supply chain (30%), electronic medical records (25%), clinical trials management (20%), and scientific data sharing (15%).

Of the benefits of blockchain, life science and pharmaceutical professionals believe the most significant is the immutability of data (73%). Significantly, for an industry with tight regulations, 39% also believe the transparency of the blockchain system is its best feature.

However, almost a fifth (18%) of professionals believe using blockchain adds no value beyond a traditional database, showing there is some reluctance in the industry to use the technology.

The Pistoia Alliance said that some of the misconceptions about blockchain can be overcome with greater education of those in industry.

Richard Shute, consultant for The Pistoia Alliance, said “We are currently focusing on educating scientists and researchers about the potential uses of blockchain technologies outside of the supply chain, particularly in R&D. At The Pistoia Alliance, they want to support their members’ initiatives in blockchain, as well as provide a secure global forum for partnerships and collaboration.”

• The Pistoia Alliance is holding a Blockchain Bootcamp on 8^th – 9^th October in Boston as part of its drive to educate the life science industry about the technology.

Written by the Priests and Pastoral Associates of Priests for Life

This study guide is based on the Vatican Translation of Humanae Vitae

Table of Contents:

Forward

Introduction to the Study Guide

Summary of the Introduction to the Encyclical and Section I: New Aspects of the Problem and Competency of the Magisterium

A Summary of Section II. Doctrinal Principles

Summary of Section III. Pastoral Directives 

Essay: Finding Our Way Back Home

Essay: Life, Purity and Humanae Vitae

Essay: The Transmission of Life -- On Whose Terms?

The Contraception of Grief: A Personal Testimony

Glossary of Terms

Foreword

That is also why their Priests for Life pastoral team wrote this Study Guide. They have also established a special website, www.HumanaeVitae40.com, to promote the teachings of this document. It is their daily prayer that this effort will lead many believers to understand, embrace, and proclaim the beautiful truth of human life. 

INTRODUCTION TO THE STUDY GUIDE

For those considering the possibility of facilitating a study group, this study guide lends itself to a discussion study group method of learning. While a leader/facilitator encourages the group and keeps it “on track”, it is the individual sharing and group dynamic that contribute most to the learning process. The facilitator is not a lecturer, neither is he there to supply all the answers. The facilitator seeks to shepherd the group learning process and does everything possible to solicit their contributions. Members interact and learn from everyone, including the facilitator. A Facilitator’s Guide is available through Priests for Life at www.HumanaeVitae40.com. The Facilitator’s Guide seeks to assist you in leading a group and lays out suggested study sessions.

It is their hope, that on the fortieth anniversary of Humanae Vitae, this study guide will assist in promoting the Church’s clear and authoritative word on transmitting human life. May all who hear this true, prophetic and lovely word be assured that: the Church has always issued appropriate documents on the nature of marriage, the correct use of conjugal rights, and the duties of spouses. These documents have been more copious in latest times. (n.4)

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Meet Ju Ki-young, a South Korean tech entrepreneur who co-founded the blockchain analysis firm CryptoQuant.

About Ju: Born in 1992, Ju, an alumnus of Pohang University of Science and Technology, co-founded CryptoQuant with fellow alumni in April 2019. Before becoming its CEO and entering the blockchain sphere, he was a software engineer who offered analyses for businesses.

What CryptoQuant does: CryptoQuant, which South Korea's Chosun Daily dubs as the "Bloomberg of Crypto," provides on-chain and market data gathered from blockchain and major cryptocurrency exchange platforms. The company keeps track of every transaction that occurs in the market.

Making a name: Using on-chain data analysis, CryptoQuant says it was the first to notice the impending crash of the Terra-Luna cryptocurrency in May 2022 and the potential bankruptcy of FTX months after.

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Ju raised the red flag in an X post, pointing out how Terraform Labs' nonprofit, Luna Foundation Guard, transferred around 37,000 Bitcoins (approximately $1.59 billion in today's exchange) to Gemini, a cryptocurrency exchange. A few days after making the post, Terraform Labs' Luna, the sister token of stablecoin TerraUSD, crashed to virtually $0.

With its success, CryptoQuant signed a partnership deal with the Chicago Mercantile Exchange (CME Group), the world’s largest derivatives and options exchange, as the latter’s on-chain data provider in July of the same year.

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Helping solve crimes: Ju hopes that CryptoQuant could also aid governments and financial authorities in tracking cyber financial crimes. In 2019, the company used its expertise to uncover the e-wallets of those involved in the “Nth Room” scandal, leading to the arrest of masterminds Cho Ju-bin, Moon Hyung-wook and others.

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Blockchain has the potential to transform their world. Experts insist the technology is "bigger than the internet," but they may want to take a beat before they put everything from their money to their health records on blockchains. According to a new study, the technology isn't nearly as secure as they thought.

Back in 2009, Bitcoin set the blockchain revolution in motion giving any two parties, anywhere, a way to quickly and securely transfer money.

Some blockchains, most notably Ethereum, take the utility of Bitcoin to the next level by incorporating smart contracts, which automate the process.

For example, say you want to buy 10 ether tokens, but only if the price drops below $600 per token. Smart contracts are set up to execute specific actions when they encounter a specific situation, so you could set one up to buy 10 ether when the price drops.

That's not all they can do: while smart contracts can be as simple as the above, they can also be far more complicated. You could also set up a smart contract to buy ether if the cost hits below $600 per token, and you have an account balance above $10,000, and it's a Friday.

Smart contracts are essential for industries outside of finance that want to take advantage of the blockchain technology. For example, if healthcare systems wanted to put medical records on a blockchain, it could use smart contracts to ensure only medical professionals are granted access to them.

While it all sounds good in theory, there is some bad news: a team of computing experts from the National University of Singapore and University College London published a study that details a surprising number of security flaws in smart contracts.

The group analyzed roughly one million smart contracts using a custom-built tool called MAIAN. The team was looking for contracts attackers could manipulate to lock funds indefinitely, force to leak funds randomly, or simply kill.

Their analysis tool flagged 34,200 contracts. It even found the flaw in the Parity blockchain app that rendered $169 million worth of ether inaccessible to owners back in July 2017. The team then manually analyzed 3,759 contracts and found they could exploit vulnerabilities in 3,686 of them.

Determining that roughly 3.4 percent of smart contracts could be vulnerable to attackers is huge. Sure, the centralized technologies they currently use to manage their finances and other important records aren't ironclad. However, if we're going to go through all the trouble of transitioning to a blockchain-supported digital economy, building a better system for record keeping isn't enough.

We should strive to build the best system. Using tools like MAIAN to expose current weaknesses is a good place to start.

Disclosure: Several members of the Futurism team, including the editors of this piece, are personal investors in a number of cryptocurrency markets. Their personal investment perspectives have no impact on editorial content.