Blockchain-Based Internet of Things …

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2.3

Decentralized Ledger

The decentralized ledger is the middle layer in a blockchain architecture that confirms

a global ledger that is consistent and temper-proof. Transactions can be grouped in

this layer into blocks that are connected cryptographically to each other. A shared and

replicated database that is synchronized among the network participants is a decen-

tralized ledger [11]. It keeps the transaction records among the network participants.

The ledger has to keep track of transactions among the participants. It stores the infor-

mation in the header, and data is stored in the form of a token or a cryptocurrency;

Blockchain has a database property. Transactions can be described as the exchange

of tokens between two parties, and before it is considered a legal transaction, each

transaction goes through the validation process [23].

2.4

Proof-of-Work

Proof-of-work is a mechanism that provides security through the prevention of fraud.

This security ensures that independent data processors cannot lie about a transaction.

Bitcoins calculate the necessary proof-of-work and add a new block to the chain every

around ten minutes [5]. Although proof-of-work slows down creating new blocks,

this mechanism makes it very difficult to tamper with blocks. Furthermore, if anyone

tries to tamper with a block, he/she would need to recalculate the proof-of-work

for all the following blocks. So the protection of the Blockchain comes from its

innovative use of the hashing and proof-of-work mechanism [4].

2.5

Peer-to-Peer

Peer-to-peer is another technique that blockchains protect themselves, and that

is through their distributed nature. Rather than relying on a single institution to

administer the chain, blockchains operate via a peer-to-peer network that anyone

can join. When a member of this network joins, he or she receives a complete copy

of the Blockchain. This may be used by the node to ensure that everything is still in

order [17].

If someone creates a new block, then the new block is sent to everyone on the

network. All nodes in the block verify to make sure that it has not been tampered

with. When everything is verified, each node adds this block to everyone’s ledger in

the network [5]. New blocks are always added to the Blockchain in a sequential and

linear order (Fig. 3).

The consensus is generated by all the nodes (users) in the network. They have

reached an agreement on which blocks are valid and which are invalid. Other nodes

in the network will reject blocks that are tampered with. So to successfully tamper