You may have read in the newspaper or watch the TV talking about the new technology Blockchain.
If you are already familiar about this, you are miles ahead and if not, read this article to learn “What is blockchain and how it will change the world?”.
What is Blockchain?
Blockchain is a digital public ledger where transactions made in cryptocurrencies are recorded chronologically and publicly.
Let us look at the whole concept in another way. The blockchain is an incorruptible digital ledger of all transactions that can be programmed to record not just financial transactions but virtually everything of value.
Blockchain is a Distributed Database
Imagine a spreadsheet or Google Doc that is duplicated thousands of times across a network of computers around the globe. Then imagine that this network is designed to regularly update this spreadsheet without missing any duplication. This is a simpler way to explain blockchain technology.
All the Information on a blockchain exists as a shared — and “continuously updated & reconciled” — database.
All the Information on a blockchain exists as a shared — and “continuously updated & reconciled” — database. The blockchain database isn’t stored in any single location, which means the records are truly public and easily verifiable. No centralized version of this information exists for a hacker to corrupt. All the information is hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.
Blockchain Technology is Durable and Robust
By storing blocks of information that are identical across its network, the blockchain cannot be controlled by any single person or organization. This means it is not open for manipulation by a specific organization or government. This also means that it cannot be overtaken by a hacker as it doesn’t have a single point of failure.
Blockchain is like a public ledger.
Since Bitcoin uses blockchain to operate since 2008, it has never been hacked so far and it has been successfully operating without any disruption.
In the layman’s language, blockchain is a system to ensure the highest degree of accountability. Since every transaction is public and it is based on the process rather than the human interpretation, it is fully transparent. Blockchain helps to guarantee the validity of a transaction by recording it not only on a main register but a connected distributed system of registers, all of which are connected through a secure validation mechanism.
How Does Blockchain Work?
Since the blockchain technology was started to support the functioning of Bitcoin, the first cryptocurrency, let us look at how it works in the cryptocurrency perspective.
As soon as a cryptocurrency is bought or sold, the record of new transactions (that could mean the location of cryptocurrency, value of cryptos) in a block are generated. Once each block is completed it’s added to the chain, creating a chain of blocks: a blockchain.
Blockchain takes care of the business of trust, and guarantees integrity.
Most blockchains are permission-less systems which means we can transfer money from one person to the other person without knowing who the other party is and independent from central authorities. The underlying technology behind the blockchain is the biggest innovation in computer science, the whole idea of a distributed database where trust is established through mass collaboration and clever code rather than through a powerful institution that does the authentication and the settlement.
How Blockchain will Change the World?
There are many projects underway by various companies and some of these could be a game changer for our society.
Here are few possible applications of the Blockchain technology:
- Financial Applications: the idea of instant and secure payments without the need for any financial institution can open doors to many new applications.
- Medical Applications: A blockchain for health records, could facilitate the integration of many medical applications and medical procedures with the patient's personal records without compromising the privacy.
- Citizenship Database: Identification information can be stored on the blockchain.
Of course there are many possibilities.
If you are new to Cryptocurrency, you should check out our article on what is cryptocurrency now!