For those starting with a blockchain network like Hyperledger, grouping participants into consortium owners, members and users is essential. Members, who manage digital certificates and access as well as ordering services, keep peers in alignment. It is the peers who hold a ledger. A peer is when the chain-code known as a smart contract as well, is executed.

Membership and ordering services align well in being centralised. On the other hand, peers can be distributed and placed anywhere across the globe. Each member of the network should have their own peer. The member’s role and capabilities in the blockchain network is determined by channels peers subscribe to.

The Value of Peers

Architecturally, the fabric of blockchain networks like Hyperledger is extremely flexible. But experts recommend one to two peers only. This is because according to a given channel, peers are one and the same. Further, they carry out the same transactions and receive identical code updates in an order as all other peers on that channel. Front-end systems that hold SDKs should be aligned to member peers. The front end systems need to talk to peers and other members front-end systems talking to their peers.

Peer to Peer Trading With Blockchains

Trades can also be settled with participants confirming transactions through the P2P network. It records the buyer and participants who sell, the number of shares traded, time of the exchange, exchange of funds and number of shares traded. This provides a centralised electronic exchange for individuals to place orders. Blockchain technology ensures trades are settled by peer confirmation, so there’s no requirement for a clearing-house or auditors to carry out verifications and custodians to ensure funds have shares held. Cutting out the middlemen means lower costs in record keeping and trading on platforms.

Peer confirmation of trades also means instantaneous settlement, as against current settlement period of a couple of working days. Higher liquidity means more investment.

How to Build a True P2P Network

One of the prominent features of the blockchain is that it bestows trust without the need for central authority. Ideal innovation can be applied for evolving a decentralised P2P sharing economy. While a sharing economy is built on a P2P model, there are still middlemen who charge fees for facilitating transactions. In a true P2P sharing economy, there should not be an intermediary dictating terms and conditions of transactions or cuts of payment.

Centralised sharing economies have key roles in making sharing economies work at present. But, by implementing blockchain technology, there is no requirement for a central authority to uphold the terms and conditions and ensure transactions are conducted in that way. Distributed ledger technology provides smart contracts, digital identities in relation to publicly-viewable user-reputation systems, or digital currency payments.

P2P Trading and Blockchain Technology

With new innovations like P2P energy trading, blockchain technology has permeated different sectors. With innovation and development, transformations are taking place in every sector. Transparency in dealings is one of the most prominent features of peer to peer networks. 

It also frames a transaction where the receiver and the supplier both benefit, without the need for a middleman. Creating open and transparent systems for trading, in different fields, the peer-to-peer network of blockchain technologies finds applications in many commercial settings. This is why the way peers are organised is equally important.

 

Published by Ruby Daub