Do you own any Cryptocurrency? Whether or not you own them, but definitely would have heard about them. These cryptocurrencies are at an all-time high both in popularity and demand. Be it Bitcoin, Ethereum they are always in headlines for one thing or the other. Their legality, transaction speed every detail is revolutionary, as they process a particular transaction in minutes without any third party interference. Many around the world are taking interest to learn blockchain technology to purchase these cryptocurrencies.
The technology behind these cryptocurrencies is Blockchain. It first came into the spotlight when Bitcoin was launched. So, what is Blockchain Technology? It is a transaction ledger database, which is shared via a distributed network of computers between all participating parties. It is safe and secure as it allows the users to transfer funds without any involvement of third parties such as payment processors or banks.
Technological advancements are improving our life. But these improvements are also coming with conditions as they can be used for both good and bad. For example, earlier you have to visit a bank to transfer your money, but with technological developments now you can send money right from to your mobile. But, there are some perils attached to it. Hackers are also getting smarter with technology and transferring money is not secure as your account can get hacked. So in all these situations, you can’t trust a third party to perform your transactions. Which is why blockchain technology is a game changer.
The research on the chain of blocks has started back in 1991, the intention behind the research was to create a system in which official timestamps of a document cannot be tampered with. Even though they achieved a certain level of progress, it was in 2008 the first blockchain was conceptualized by Satoshi Nakamoto. There is no clarity who this Satoshi Nakamoto is, it is a pseudo name used by a person or a group of persons.
Satoshi has improved the older design with a method like Hashcash. Under this method, they can add blocks to a chain without any third party interference. This technology was later implemented as a key component for cryptocurrency Bitcoin.
How does it work?
Blockchain is a decentralized public ledger used to record transactions between parties in many computers. The coolest thing about Blockchain technology is the recorded transactions cannot be altered. If you alter one transaction, you must alter the entire block, the subsequent block and whole blockchain, which is impossible.
Each transaction is verified by computers using an algorithm, it confirms the transfer and creates a ledger for the activity performed. All these transactions are processed through a network. The computers or nodes which form these networks are located throughout the world and they’re not controlled or owned by a single owner.
Every single transaction is validated and the user’s status is verified by this network of nodes using known algorithms. All this process is performed real-time and it assures complete safety to process your transaction. A transaction can consist of cryptocurrencies, records or contracts.
Once verified, this transaction is combined with other purchases to form a new block, that particular block is added to the already existing blockchain. All this is done in a matter of minutes which is impossible for trusted third party sources such as banks.
Why is it Important?
Blockchain is still quite a new technology, it needs to be explored to the fullest to understand its potentials. Currently, blockchain technology is only used to trade cryptocurrencies but, it has its usage beyond it. It can be used in many other industries. Blockchain grants digital ownership.
The Internet has made life easy, you can now stream movies right from the comfort of your coach. From food to gifts we order everything online. Don’t you think it’s high time we start owning digital data? Blockchain allows you to own digital data, assets and digital goods.
Here are a few instances that prove to you why blockchain technology is important.
From your credit card info to health records everything is important. When a bank or a hospital save you in information on paper or their central server there are high chances that this information can be hacked, altered or stolen.
Card details, personal information such as email id, date of birth, social security number when saved online can be hacked, which can seriously affect you. With Blockchain technology, you can gain complete control over your digital records. It will keep your data safe and saves you from frauds.
When you’re goods or money are stored with a third party there are high chances that you’re items can be confiscated. What is the point of saving them when they can be easily taken away? Blockchain technology will provide you with digital freedom as it is decentralized, which means no central authority can control or manipulate your transactions or assets. If only you had access to all your data or assets, no government or banks can confiscate it.
Fast & Secured
Trusted sources like banks take minimum 24 hours to process your transactions, don’t even get started on a cross-border transaction. But with Blockchain technology, you can be worry-free while sending funds. It processes a block within minutes, which means your funds are transferred to the other party in less time.
You don’t even have to worry about extra transaction costs while transferring your funds. The transaction speed is what makes blockchain technology special and once a transaction is finished it is stored on a public ledger safely away from hackers. Using blockchain can reduce frauds and scams.
These are just a few examples of what blockchain technology can do. It can be used in different industries. Did you know blockchain can even track the origin of food on your table? This is one of the many benefits of using Blockchain technology.
Even financial industries are also interested in embracing this technology to change their system and provide users with better service. The whole world is having its eyes on blockchain currently, people are trying to understand and adopt it.
Blockchain is much more than cryptocurrencies. It provides you with both digital security and freedom. Companies like Facebook are planning to use this system to launch their own cryptocurrency. This decentralized ledger transfers your funds fast and easy.
No hacker can hack or steal your data when you process a transaction using Blockchain. Not only that you don’t have to worry about the transaction costs and third-party intervention. Future would see the blockchain development and its regular usage in people’s day-to-day life.