Have you heard of it? It is a hot topic in the financial world, but many people don't fully understand what it is. It’s the technology behind Bitcoin and other cryptocurrencies, a buzzword in 2018 and beyond. But it’s not necessarily easy to understand. Like me, you’re probably asking yourself: what, exactly is blockchain?
In this post, I will introduce blockchain technology, and take a closer look at how it works and where it comes from. Firstly, this technology is valuable and used in various industries. I explain what you need to know in this article. I hope you will enjoy and challenge yourself to explore further.
Where
does it come from?
The first blockchain was by Satoshi
Nakamoto an anonymous person (or group) in 2008. However, it was put into practice the following year as a core component of the digital currency bitcoin.
It now serves as the public ledger for all transactions on the network.
Today, dozens of startups are racing
to bring blockchain technology to markets as diverse as finance, manufacturing,
insurance, energy, and healthcare.
How
does Blockchain technology work?
The first step to understanding
blockchain and how it works is knowing there are two main parts: the network
and the blocks. The network consists of computers, known as nodes,
linked together through a peer-to-peer network (my computer to your computer).
These computers verify transactions and keep records of them in a public
ledger.
In this ledger, digital money
is used to make transactions. A computer on the network validates the
transaction and then adds it to the Blockchain. This means that each computer
must agree that the transaction is valid. However, the transaction
is completed if the sender has sufficient funds. Validating a transaction
involves solving complex mathematical problems, which require significant
computing power. See my article on "What is an NFT?" for information
on using digital money to buy on the blockchain. There are marketplaces to
create, buy and sell NFTs. For example, here are a few for you to check out, OpenSea,
rarable.com, and crypto.com.
There are many facets of blockchain
technology, but there are two main features – one being a single
organization or government does not control it. The other component is once
data is verified it will not be removed or changed. It is a secure method for
recording and storing data.
What
is the blockchain platform?
Blockchain has been around for
years, but it has only recently captured the world’s attention. It is similar
to a database, in that it is a collection of records. But there are some
important differences between the two database platforms. A blockchain has no
central servers that hold the data. Because individual computers all over the
world host the data, it is openly available to anyone on the internet. Whereas,
a single server hosts a traditional database.
Conclusion
As an end user, you don't need to
know how to code blockchain. However, it's helpful to understand some basics
about how it works so you can decide what will be best for your business.
I hope this article helped you to
understand what is blockchain and how it works. This technology has a lot of
potentials. In the end, your imagination is the only limit to what you can do
with it. Learn more about its future impact on businesses and the
world. Enjoy this journey!
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