Distributed Ledger Technology (DLT) is the core of blockchain technology, removing the inefficiency and high cost of traditional markets and enabling the sharing of distributed databases. It allows multiple parties to have copies of ledgers, update transactions in real time, and ensure data security through consensus mechanisms. DLT is divided into private and public, the former is centralized and the latter is decentralized. Public blockchains face limited transaction processing capabilities, block size restrictions, and high energy consumption. The main differences between DLT and traditional databases are decentralization, transparency, immutability, and high availability. Blockchain ledger used in the food supply chain management can improve transparency and traceability and prevent food safety issues.

Distributed Ledger Technology (DLT)

Distributed ledger technology is the most important blockchain ledger used in the capital market. It can remove the extremely inefficient and costly parts of the current market infrastructure. A distributed ledger is essentially an asset database that can be shared across a network of multiple sites, different geographical locations, or multiple institutions. Participants in a network can obtain a unique, true copy of the ledger. Any changes in the ledger will be reflected in all copies within minutes or even seconds. Records in the ledger can be updated by one, some, or all participants according to the rules agreed upon in the network.

What is a ledger?

A ledger is a record of maintenance and property. Property includes money, houses, information, etc., while maintenance refers to property transactions, ownership updates, etc. Any valuable information exchange can be regarded as a ledger.

Development of ledger:

The development of DLT is only possible with decentralized distributed digital ledgers. We can make a simple classification of DLT based on whether it is necessary to identify the identity of the node and the permission to read the data:

Another classification method may be more direct. We classify private blockchains into Permissioned and public blockchains into Permissionless:

Among them, Consortium Blockchain is an industry blockchain, which is neither completely centralized nor completely decentralized. A group will designate multiple pre-selected nodes as bookkeepers, and other nodes can join or leave the blockchain network with the permission of the bookkeepers.
      For private blockchains, only a single (or a few) nodes are responsible for the maintenance of the blockchain (write permissions), and like traditional database systems, it is completely centralized. In public blockchains, anyone can participate in its consensus mechanisms, send transactions, and a node can leave or join at any time.

Here we list some of the problems that public blockchains may have:

  • Limited Transactions: For example, the Bitcoin blockchain can only process less than 10 transactions per second.

  • Limited Block Size: For example, Bitcoin has a block size of only 1 MB.

  • Energy Consumption: Public blockchains are based on the so-called Proof-of-Work (PoW) technology, which is used by Bitcoin and results in a lot of time and energy consumption.

As we mentioned at the beginning, DLT can essentially be seen as a database, but it is different from a traditional database management system (DBMS):

Blockchain Basics
Data management and organization in DLT can be achieved in a variety of ways:

  • Linear linked list of blocks

  • Directed Acyclic Graph (DAG)

  • Tree-like data structures

If DLT is implemented based on blockchain ledger, this is what we usually call blockchain. Of course, DLT implemented in DAG or tree structure can also be called blockchain.

Definition of blockchain:
"Blockchain" is a data structure in which data is read-only and cannot be modified once it enters the blockchain. New data can only be appended to the end of the blockchain, which makes the blockchain very difficult to tamper with.

The characteristics of blockchain make the information it records more reliable and avoid the problem of distrust from third parties. Blockchain essentially removes the trusted third party from the middle of the transaction parties and publicly establishes trust in an untrusted and unknown environment.

A diagram of a blockchain is as follows:


It consists of three elements: block, chain and transactions.

  1. A block

    is a basic building block for storing information. For example, a block may contain:
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  2. Each block of the chain

    needs to be linked together to form a blockchain. As we mentioned earlier, these blocks can be linked in a linear order, but there may be problems with scalability, fast indexing, and security. We can also use a graph or tree structure to link.

  3. Transactions

    can store any information related to transactions, such as property owners, digital currencies, loans, birth and death records, land records, etc. This transaction information can be used to track the circulation of goods.

We have just compared some of the differences between DLT and traditional DBMS. Now let’s take a closer look at the characteristics of blockchain compared to traditional database systems.

Characteristics of blockchain:

  • Decentralization

    Blockchain has no central control. Through distributed computing and storage, each node can independently manage and control data.

  • Transparency

    Anyone can trace the transaction history, which makes the blockchain system highly transparent and open, especially for public blockchain systems.

  • Immutability

    Once transaction information is added to the blockchain and verified by the nodes, the transaction information cannot be tampered with at will.

  • Availability

    Due to the distributed and decentralized nature of blockchain, the ledger itself is available to the nodes, so the availability of the system is high compared to centralized systems (which have a single point of failure).

  • Security

    The security of blockchain is reflected in:

    • Strong public/private keys, which traditional database systems do not use

    • Hash algorithm. Traditional database systems do not require the use of a hash algorithm for each piece of data.

    • Digital Signature

    • Encryption

Non-Repudiation

Once a transaction is added to a blockchain node, its ownership belongs to the node and cannot be changed.

Smart contracts and distributed applications (DApps) play an essential role in utilizing blockchain technology to build various use cases, especially in decentralized finance (DeFi) systems.

Application in food supply chain management:

Applying blockchain technology to the food supply chain management can help us improve transparence and traceability. We monitor the status of food at every stage of the food supply chain, recording the status of food so that we can clearly see at which stage the problem occurred. If food is found to be contaminated, it must be recalled immediately.

The high transparency of blockchain also makes it impossible for merchants to tamper with trademarks, and they must classify and price corresponding items accordingly.

By creating a transparent trading environment and mutual cooperation among supply chainparticipants, blockchain technology helps people to transparently supervise the entire supply chain, reduce food safety hazards, eliminate fraud, and reduce waste.