BLOCKchain

An Introduction

What is blockchain in simple terms?

Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.

Technical Definition: Blockchain is a new data structure that is secure, cryptography-based, and distributed across a network. The technology supports cryptocurrencies such as Bitcoin, and the transfer of any data or digital asset.

Spearheaded by Bitcoin, blockchains achieve consensus among distributed nodes, allowing the transfer of digital goods without the need for centralized authorization of transactions.

How does Blockchain technology operate?

  1. The technology allows transactions to be simultaneously anonymous and secure, peer-to-peer, instant, and frictionless.

  2. It does this by distributing trust from powerful intermediaries to a large global network, which through mass collaboration, clever code, and cryptography, enables a tamper-proof public ledger of every transaction that’s ever happened on the network.

  3. A block is the “current” part of a blockchain that records some or all of the recent transactions, and once completed, goes into the blockchain as a permanent database.

  4. Each time a block gets completed, a new block is generated. Blocks are linked to each other (like a chain) in proper linear, chronological order with every block containing a hash of the previous block.

Benefits of blockchain technology:

  1. As a public ledger system, blockchain records and validate each and every transaction made, which makes it secure and reliable.

  2. All the transactions made are authorized by miners, which makes the transactions immutable and prevent it from the threat of hacking.

  3. Blockchain technology discards the need of any third-party or central authority for peer-to-peer transactions.

  4. It allows decentralization of the technology.

Uses and possibilities of blockchain:

  1. Confidential communication of cryptocurrency.

  2. Safe, cost-effective, and fast bank transactions.

  3. Secure legal documents, health data, notaries, and personal documents.

  4. Distribution of land records and government financial assistance.

  5. Cloud storage, digital identification, smart communication, and digital voting.

The current debate in the USA has, unfortunately, focused too heavily on trading and speculation, looking at cryptocurrencies as an investment tool, rather than understanding the potential of core blockchain technology and the basic role of cryptocurrencies as an incentive mechanism to secure decentralized transactions.

An In-depth analysis

Most popular use: Cryptocurrency

But how does bitcoin actually work?

Security

of Blockchain using the SHA-256 algorithm

How secure is 256-bit security?

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