Short Expanation of Blockchain?
Blockchain is an innovative technology that has the potential to revolutionize any industry using it. With such a promising outlook, some might think that blockchain technology is a complex concept that would require three PhD’s just to understand it. But, in reality, the simplicity of blockchain technology is rather remarkable.
A Simple Look at Blockchain
When simplified, blockchain is really just a chain of blocks. However, the scientific depth behind the words “chain” and “blocks” is what makes this technology so astounding. The words “chain” and “blocks” aren’t physical objects as we know them. Instead, these are digital aspects of information. A “block” is the actual assemblage and storage of digital information, while a “chain” is the public database of blocks.
This public database (chain) is also referred to as a public ledger, which records all of the transactions (collection of blocks) and can’t be altered.
More Details about Blocks
Blocks store the information of a specific transaction, which can include details like the type of transaction and details involved. Additionally, each block can be distinguished from other blocks on the chain by a unique signature called a “hash.” This code identifies a specific block and the previous block connected to it.
Depending on how advanced the blockchain technology is, and there are many developers throughout the world constantly advancing this tech, the size of data in each block can be up to 1 MB or more. Additionally, the more advanced the blockchain tech is, the faster the transactions are.
A Decentralized Public Database
What makes blockchains so effective is how the data is stored. Blockchains are built on peer-to-peer networks to avoid a central location, which is the basic definition of “decentralized.” Anyone can analyze or review the digital contents of a blockchain. Furthermore, this decentralized construction of a blockchain makes it harder for hackers to completely steal or fully manipulate the entire ledger of information.
It must be noted that although anyone can view the transactions on a blockchain, they can’t view the identities of the individuals or parties involved in the transactions. The identities are protected through the cryptography used in the particular network. A popular example of this is cryptocurrency, which is a digital asset that uses high grade cryptography to secure and protect whatever transactions that are using these assets. When crypto coins are sent, they use unique addresses (codes) to send from one source to another. Identities of the parties are never revealed. Instead, the addresses are public.
Who Created Blockchain?
In the early 1990’s, work was being done on a primitive form of blockchain technology. However, it wasn’t until 2008, that a mysterious developer named Satoshi Nakamoto brought the concept of blockchain technology to life. Nakamoto, who remains anonymous to this very day, made a few modifications to the early research of chained information and created Bitcoin.
Bitcoin is the most popular cryptocurrency and blockchain example in the world. The coin’s protocol is built on the blockchain technology and has real world applications. In fact, you can actually gamble with bitcoin, pay for goods, and so much more.
What are the Benefits of Blockchain
Some of blockchain’s benefits have already been touched on in this article like being decentralized and public. However, there are many more benefits of this advanced technology including the following:
- Track information
- Transparent tracing of ownership
- Verifiable records
- Executable contracts (smart contracts) between parties
- Exchange of digital value (cryptocurrency)
- Reduces transaction costs
- Faster speeds, Less time to make transactions
What does Blockchain look like in the real world?
When you start applying this technology to real world industries and applications, blockchain technology can absolutely revolutionise any given business. For example:
- Banks, and P2P services like PayPal, will be able to send transactions any size transaction in a more secure and faster manner. Additionally, banks and P2P companies won’t have to make their customers wait anywhere from a few hours to a few days to send money across the globe.
- Supply chain businesses can quickly verify a product or transaction anywhere along the chain in order to validate or verify the authenticity of an item or the details of a specific transaction.
- Accounting firms can have secure blockchain systems to protect private data, track any financial transaction, and prevent tax fraud.
- Energy companies can make consumption more transparent to their customers. They can also track clean energy and renewable energy.
- Real Estate brokers and investors can protect and complete transactions in a more efficient, faster process.
These are just a few examples of what blockchain technology can do. Currently, there are many different industries, throughout the world, that have already employed this technology. Each day, more and more businesses are rushing to adopt this tech.
Blockchain can change the world
All too often, we hear about how a certain product, service, business or entity can change the world. And in some cases, it does. When it comes to blockchain technology, it will change the world 10 times over. We’re standing on the cusp of the next great technological advancement. Think of it like how the internet changed the world in the late 1990’s through early 2000’s. This advanced way of sharing, storing and protecting information will transform every major industry as we move into the future. It will also reshape the way we buy groceries, pay bills, use money to pay for services, and any other type of transaction that has become an everyday occurrence.