When you ask people what they think about Blockchain, they will probably talk of Cryptocurrency. Does that mean Cryptocurrency is the same as Blockchain? During the early stages of blockchain popularity, people’s understanding of Blockchain is mainly restricted to Cryptocurrency. Why is this so? Blockchain was created and launched in 2008 by a group of people using the name Satoshi Nakamoto to serve as a public ledger for the transaction of the Cryptocurrency, bitcoin. This idea behind the creation of Blockchain forced people to understand they have, but Blockchain is more than that. Blockchain technology is not only applicable to the cryptocurrency network. Like some experts will say, it has an ending opportunity to explore.
Does this mean Cryptocurrency can not survive without Blockchain? No, it is all about coexistence. Cryptocurrency runs on blockchain technology because of the features it offers, such as Privacy, Security, and decentralization. If we look at this, we can say without the popularity of Cryptocurrency at first launch; Blockchain might still be in the shadow now.
What is Blockchain?
Blockchain is developed as a series of blocks. In other words, “block” in context means digital information held together by a “chain.” The chain in context means a public database. You can defined Blockchain as a system of storing data (mostly ledger transaction), which is later duplicated and distributed across an entire network of a computer system on the “blockchain.” This complex interaction makes it impossible to change, hack, or cheat the system.
What information does the blockchain technology store?
For every transaction, blockchain technology stores three necessary information. The three information are:
- The Blockchain technology stores information related to the time of the transaction, date of the transaction, and the amount involved in the transaction.
- Of course, Blockchain needs information about the parties involved. Blockchain technology also stores the details about the partied involved using digital signatures then linked with a user ID.
- The hash technology. The Blockchain uses the hash technology to distinguish between transactions. This means each transaction possesses an ID that recalls them when needed. Though this ID may look similar to the human eye, they are different from the blockchain technology.
How does the Blockchain technology work?
The limited adoption of Blockchain around the world is nothing but a lack of knowledge on its working mechanism. For simplicity, we try to divide the mechanism using three terms, Blocks, Miner, and Nodes.
Similar to the simple cash transaction, blockchain technology needs two parties for transactions to occur. Before a transaction can be registered in a block, it has to be acknowledged. By acknowledgment, we mean it must be assigned a unique math code, the hash. Any change inside the block, the hash automatically adapts to the change and send over the new information to the preceding blocks. So basically, all transaction information is stored in a block protected by hash keys.
This step involves building new blocks through the method known as the mining System. The blockchain system is a complex mathematical system; miners use a specially developed system to solve the mathematical challenge and create a new block attached to their chain.
This process is called decentralization. Decentralization means a chain in the blockchain system can not be own by any computer or organization. Instead, it is distributed through a chain related nodes. Nodes can be in the form of an electronic device or computer that owns a copy of Blockchain. For any device to participate in the blockchain system, it must support the full update of collected blocks algorithmically, track the chain, and trust the chain. Because of decentralization, Blockchain is transparent to every node on the system.
Is Blockchain only applicable to Cryptocurrency?
No, Blockchain is not only used in Cryptocurrency. Other possible uses of blockchain include; Medical field, monitoring medicines prescription transparently; energy sector, natural settling of future trades; and food security, monitoring the transportation of food and product from the starting point to the endpoint.
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