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So, if you're among those wondering about what is blockchain, do not worry, this article is an easy guide on the blockchain technology for beginners.
Many people think that technology is newly invented. Stuart and W. Scott, who was first to be sketched in 1991 by two researchers Stuart and W. Scott. However, it was in January 2009 that Blockchain had its first real world application i.e. Bitcoin.
According to Melanie Swan, author of "Blockchain: Blueprint for a New Economy" the blockchain definition is that it is an information technology and much more, "it is a decentralized trust network."
But why the name: blockchain? Because it is a chain of blocks where the digital information is stored in a public database (the chain).
An ideal blockchain consists of multiple blocks strung together. Digital information over a network. Part of the network, called "nodes" validates the data.
We will not be wrong in saying that blockchain is a revolution in the world of technology. However, only time will validate the scope of blockchain in the future.
As we proceed, we know how and why blockchain is important.
Learn about blockchain technology here:
How Does Blockchain Work?
Blockchain uses a peer to peer network of computers to validate transactions. It allows users to make and verify transactions without the need for a central authority.
Here is how to blockchain transaction takes place:
- Once you make a transaction online, the date, time, the amount, everything is stored in a block.
- This information is crypted and is stored as a unique string of numbers and letters called a hash.
- They entered. And hash from the previous transaction as well.
- It is written into a block.
- Each block refers to the previous block and forms to "chain."
Why is Blockchain Important?
Remember those days when funds transferred from one account could literally take days to get to another account? Validating the transaction would take so much time.
The question of security arises. Anyone with access could be tampering with the data and large amounts of data on central servers are targets for hackers.
The main aim of blockchain is to provide a low cost, safe and transparent environment for secure transactions. It can cater to many industries with the scope of blockchain.
The blockchain technology can be used in various domains like financial institutions. You can easily create a record of who has accessed the information. It is stored across a large network of computers. At least 51% of the network, which is near impossible to do.
A good example of this is an international transaction that takes few days to complete. With blockchain, the same transaction can be completed in a few minutes, securely and no one can be tampered with the transaction is validated.
Benefits of Blockchain Technology
Here are the benefits of the blockchain technology:
Secure data
Blockchain is better than the traditional methods of saving records on papers.
The network is stored in the network, which makes it difficult for hackers to hinder with the security.
This is the reason why industries such as finance, banking etc. where the data shared is sensitive, are turning to blockchain technology for a solution.
Transparency
Blockchain technology is complete in itself, accurate and consistent with all the members.
The distributed structure of blockchain makes it possible for users to control and access details about the transactions. One can clearly access the transaction histories done in the past.
Easy to trace
If you are a group of companies that are complex in nature and pass through various computer networks. Then it is quite possible that you might never know where the product originated and where it was finally delivered.
But with blockchain, you can easily trace the entire journey that makes the network. This helps prevent any fraud or manipulation.
It is not impossible for hackers to block a network, but it is difficult to understand every single block. Hacking such a network is not worth the effort put in and the larger the network gets, the tougher it is to hack.
Disadvantages of Blockchain Technology
Effects the entire process
If a single data block is to be changed, then the complete set of data will also be changed. Thus, if you have a single point of time, you need to go through the entire process of changing every related data.
Difficult to understand
For not so techy people, understanding how virtual transactions can be a bit difficult. I know how to block people that are difficult to explain to people.
However, what we mentioned in this article is just a crux of this technology. We hope to be a little more familiar with it.
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