What everybody ought to know about Blockchain Technology!
Updated: Sep 5, 2019
In 2008, an anonymous person or a group of people, whom was acknowledged as Satoshi Nakamoto, introduced Blockchain Technology - a new way to store data.
Blockchain is simply explained!
For decades, people are eager to explore more solutions for storing data. Recently, Blockchain technology is something that has been discussed popularly in town. This method offers users to store almost any types of data from medical records, copyrights, to financial records. Data is stored as blocks. Each block contains created time and information. All created blocks are connected in an order of time. In addition, established blocks cannot be modified. Users just can adjust recorded data by adding new blocks that contain changed information to the chain.
Not just that, a network of servers or computers is also created to host the Blockchain. Therefore, data within any Blockchain is distributed to all the Nodes in the network. Node is any computer that operated by miners, and hosts the Blockchain. By hosting the blockchain, miners will be rewarded to maintain their services.
Why Blockchain technology is different?
Blockchain was built to enhance traditional ways of storing data. Commonly, most people store their data at one central server. However, there might be a chance that the central server got hacked. Then, contained data can be manipulated. This is extremely dangerous with banking servers. Therefore, a blockchain is hosted on multiple servers to keep data away from being hacked or manipulated.
Blockchain is an open-source program, which means users can access a block explorer to download the source code, or to track down any activity. This creates a chance for everyone to join the network as being a miner, or to use the resources within the network as a user. A created block cannot be overwritten, and can be found by a block explorer. Hence, transparency is an assertive nature of Blockchain technology.
Additionally, anyone can join a Blockchain network without submitting any personal information. Users can stay completely anonymous while using resources of a Blockchain network. It means no one can interfere or administrate. How? At the beginning, to join a Blockchain network, a user should be given an address with no requirement for personal information in return. Therefore, there is no record regarding who owns what address. Everything users can find on a block explorer is distribution of resources in a network with certain addresses. It is the reason why Blockchain technology can offer security, transparency and anonymity at the same time.
The icon of Blockchain technology
The term ‘Bitcoin’ is getting trendier in the last few years. Some people also recognize Bitcoin as a representative of Blockchain industry. However, Bitcoin is actually just an application of Blockchain. It means Bitcoin is not showing all the aspects and advancements of Blockchain technology. Bitcoin is a cryptocurrency which can be used to replace fiat money in financial transactions. Bitcoin offers anonymity, transparency and security to its users.
Besides, Bitcoin is actually designed to solve the double spending problem. Before Bitcoin era, people use digital currency as token form to pay for merchandises and services. This is where the ‘single point of failure’ happens, just because everything is recorded in one server. Hackers can use some technical techniques to manipulate the server, and then create multiple copies of a digital token. Afterward, they can use those copies to pay for goods and services just as similar as the original token. This issue also creates inflation within a payment system.
We will explain further about Bitcoin and Cryptocurrency in next articles. Please stay tuned!
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