# The Role of the CFO of an Industrial Company: An Analysis of the Impact of Blockchain Technology
## 2 Blockchain Technology  
Blockchain technology was firstly introduced in 2008 in the form of a white paper called \"Bitcoin: A Peer-to-Peer Electronic Cash System\" published by an anonymous individual or group known as [PERSON] [5]. Thus, the cryptocurrency Bitcoin constitutes the first application of blockchain technology. A blockchain is described as a digital data structure; that is, a shared and distributed database containing a continuously expanding log of transactions [6]. The data are stored in decentralized and uniform ledgers that are distributed among all participants, also referred to as nodes, of a computer network. A blockchain is composed of a series of blocks linking every new block cryptographically to the previous one. These blocks contain a certain quantity of records of transactions. Once a new block is verified, the ledger is updated and offers all participants a shared truth of records [7; 8]. This results in a number of distinctive characteristics in regard to decentralization, persistency, anonymity and auditability [9]. Blockchains, other than highly centralized systems, avoid a single point of failure due to the redundant storage of data in a distributed ledger across all participants of the network. In case a single network participant should drop out or be compromised, the identical data records remain available at the other network participants, causing a high degree of persistency and transparency [10; 11]. Thereby, it is nearly impossible for a single network participant to falsify or tamper data, as the comparison of the consistent data records being held by the other network participants would reveal a corruption of data [12]. As a result, a blockchain incorporates a high resilience to node compromise. The block-chain also eliminates the need for intervention of central authorities, which normally build participants' trust in centralized systems [9]. Each transaction performed on the blockchain is validated with the consensus of the network nodes. Therefore, a trust-free operation is possible without the necessity of a mediating party checking for compliance and accuracy of the operation. The requirement for consensus validation of the transactions and the provision of a time stamp on each transaction render the individual transactions highly auditable [13]. Even though the cryptocurrency Bitcoin remains the most popular application of this technology, the scope of application goes far beyond cryptographic currencies. Accordingly, [PERSON] et al. see fields of applications in various financial services such as digital assets, remittance and online payment [9]. Thus, the latter authors see blockchain technology as an enabler for the next generation of internet interaction systems, such as smart contracts, public services and IoT. Outlier Ventures consider the blockchain as a key technology to enable intelligent M2M networks that could potentially exert a considerable influence on traditional industries such as design and manufacturing, distribution and logistics, as well as retail and commerce [14]. However, today's blockchain protocols still need to cope with a multitude of disadvantages compared to traditional centralized databases. Challenges include the scalability, security, anonymity and data privacy [11]. In particular, public blockchains such as Bitcoin or Ethereum suffer from a comparably low transaction throughput and high latencies for transaction settlements, leading to limited scalability. The transaction throughput of Bitcoin is currently maximized to seven transactions per second. To put this into perspective, VISA's centralized transaction processing network can process an average of 2000 transactions within the same timeframe [15]. Moreover, the purposefully designed energy-intensive consensus mechanisms of e.g., Bitcoin also limit the scalability, while further neglecting ecological sustainability [16]. However, the scalability is a critical element as it is decisive for a wide-scale adaptation of a technology in the practical context [17].