WHAT IS BLOCKCHAIN?
HOW IS IT CHANGING WORLD?
The term “Blockchain” is often interchangeably used with the word “cryptocurrency”. But, are these really the same? What is Blockchain? This article will explain the concept of blockchain technology and its real world applications other than cryptocurrency.
Blockchain technology came into the world when cryptocurrency came in 2009. The world of digital currency runs on the blockchain technology which makes the transactions and other details transparent and secure. Blockchain technology has the potential to make the digital world much more secure and fault tolerant and can change society and make this world a better place to live. The blockchain technology was first described by a group of researchers in 1991 but didn’t get much attention till 2009 when the cryptocurrency named “Bitcoin” used this technology for the first time. By 2012, the term blockchain got a significant hype in the technical world with the increase in the values of the cryptocurrency. This explains that Blockchain technology is much more than cryptocurrency. Cryptocurrency is just a use case of the Blockchain technology. But, What is Blockchain technology then? How can it be used to change the world? This article talks about the basics of blockchain technology and suggests some real life use cases which when used with blockchain can give us the best results.
The one liner, most basic definition of the Blockchain technology is that it is an online distributed system which can store information. Making it even shorter would give us that Blockchain is an online database. Now, Blockchain is much more than just an online distributed database. It is an online distributed system which can store information and it is based on the interconnected blocks which are open for everyone who is part of the network. The name talks for itself, “Blockchain”, a chain of connected blocks. These blocks store information and the way these blocks store and share the information is what makes this network unique and stronger. In addition to this, Blockchain is also a decentralized network where no single body is the owner, but every single body part of this network owns it.
Blockchain technology has 6 major properties which make this network the strongest network ever. These are Programmable, Distributed, Immutable, Time-stamped, Anonymous, and Secure. We will be discussing all these one by one in this article further, and will try to understand how all these makes the blockchain network stand out.
The blockchain network is the programmable network created by the blockchain developers. These developers use programming languages similar to the software and backend developers to create the program for the blockchain network. This means the blockchain network is a customizable network and can be built using programming languages. The most basic form of programmable blockchain network is “Smart Contracts”.
Smart contracts are small programs with conditional loops which are initiated automatically when the desired conditions are met. The famous use case of smart contracts is in the education sector. We can create the academic certificates secure and openly available to everyone by using Smart contracts and Blockchain technology.
The blockchain network is a well distributed network, which means that the data stored in the blockchain network is distributed to each and every node of that network and entries are created for that data point in each node. In other words, all network participants have a copy of the ledger for complete transparency of the transactions. This distributed nature of the blockchain network makes it fault tolerant and impossible to be hacked.
Even if the hacker managed to corrupt the nodes of the network, he still cannot get away with the information without getting caught. This makes this network trustworthy for use to solve real world problems.
Being immutable means you cannot delete anything or change anything. The blockchain network is an immutable network. If an entry is made in this network, it cannot be rolled back or deleted from the network ever. Even if anyone tries to make any changes, those actions will also be recorded and are stored in the network forever.
The immutable nature adds another layer of the security and surveillance over the transactions and actions happening in the network. The Immutable characteristic of the blockchain network makes surveillance and intelligence a good use case for this network.
TIME — STAMPED
The actions and transactions made through a blockchain network are all recorded in the blocks of the network along with the time-stamp at which it happened. Every block has all the transactions time-stamped and every block is capable of validating the information in any and all the other blocks.
These time-stamped entries add an extra layer of detailing related to the transactions into the network, increasing the trustworthiness of the blockchain network.
A unique property of the blockchain network is its anonymous nature. The anonymous nature here means that the identity of the participants of this network is either anonymous or pseudonymous. This means that the true identity of the user of this network is not revealed to anyone who is part of the same network. Every participant gets a unique pseudo identity for himself using which he/she can perform the transactions.
This property of the blockchain network makes it a strong solution for privacy related issues we are facing on the internet and online transactions today. The finance sector can use the blockchain network to secure the critical financial details of the customers in this way and provide them a better and safer user experience.
The biggest reason for the popularity of the blockchain network is the high level security provided by it. All the records are individually encrypted. This encryption is done using the hashing concept. The data is converted into a hash code while storing it into the nodes and this hash code is very unique for the content in the data stored. This hash code is so unique that if you make even the tiniest change in the data, the hash code of that data changes entirely and this change in the hashcode impacts the hashcodes of that data in all the other nodes.
This kind of encryption makes it impossible to crack for any unethical participant in the network and makes the network extremely secure and fault tolerant.
The blockchain network is a decentralized and distributed network which was introduced with the cryptocurrency. Apart from financial transactions of the digital currency, there are many other use cases of the blockchain technology. Researchers and developers believed blockchain to be the next paradigm for the world which has the potential to change the way we trust on the businesses, government and the internet. The high level of security and multiple copies of a single transaction make this network a trustworthy solution to many real world problems. Blockchain technology is seen as next big revolution in the world after the internet.