Late 19th century, a majority of the people did not use the internet. Whereas, next 20th century comes with new technologies, innovations. Which totally change the nature of the environment. As barter system introduce the transactions process. Afterward, leather money uses for transactions, which later turn to metal, then gold asserts itself in trading. In addition, with the passage of time transaction process introduce paper money.
Finally, technology introduces the digital money for the transaction in all over the world. Which is most flexible and convenient. while, In the general discussion of the technology, blockchain is at the top of the list. Now, the question is, what is blockchain? how does it work? And many more discussion will be available in this article.
What is blockchain?
The blockchain is a technology to verify and record the digital made transactions. It is directly underlying technology to the bitcoin. This technology has the ability to transfer, inform and secure the money. Basically, it is a term which describes the distributed network database technology underwrite once and read the only system. Here, we can observe the one thing,
Bitcoin = blockchain
Ethereum = blockchain
Other crypto-currencies = blockchain
Smart contrast = blockchain
Distributed ledger technology = blockchain
Blockchain technology has the four major components. Are given below;
- Privacy: System provides the complete security to its followers regarding their transactions and its recordings.
- Smart contracts: This system is enabled to add in and being able to execute on individual chain codes.
- Establish consensus: If you have a strong distributed ledger then participants and a network will agree to the transactions happen. Which need to be a means of establishing consensus between two or more parties.
- Control: A database which easily shares by different organizations. Whereas, no one authority has full control over it. Which differentiate it from other traditional database platforms. Where multiple people are using this database, there is always one party to write read and connect it to others.
Why blockchain seeks the other’s attentions???
People who don’t like traditional transactions system and bored up because of a time-taking process of payments. Accordingly, interested to adopt a new, secure and fast system of transactions. They tend toward the blockchain technology.
Founder and CEO of multichain Dr. Gideon Greenspan say, “People are interested in Bitcoin because of, first of all, it’s technologically interesting. It’s a combination of ideas that’s may have been used before but the way they’re put together and the end result is smart and unique. The second reason is because it enables censorship free digital finance: That is a goal that has never been achieved before. The idea that you can transact digitally with who you want, without there being any central place that can be pressured or switched off is new. The third is the endless speculation in the price, as it goes up and down. It’s an endless story in itself which keeps people interested”. In addition, “People are interested in private and permission blockchain because they offer the possibility of making certain types of IT systems more efficient. This effects IT systems of multiple organizations where companies need to communicate with each other.
Basically, it is a recode of what you have. As blockchain is completely different from traditional database technology. in addition, with no central storage and no central administrator of a ledger.
Accordingly, it is an asset and can share across the world. However, this technology id so-called blockchain. people create it and tend to digital cash of the bitcoin. Bitcoin and other cryptocurrencies are accumulating in blocks. And, then by using the cryptographic signature, the blocks are add to the chain.
Benefits of blockchain
- Secure way of transactions and crystal clear process.
- Miners authorize the transactions. Transactions become immutable and secure from hacking.
- blockchain technology minimizes the existence of the third party in transactions.
- decentralization of the technology.
Whereas, Banks and other organizations are going to invest in this space. Following are some banks and other FIs on the blockchain.
In addition, some of the use cases and non-financial use cases of blockchain are as follows,