Blockchain technology is undoubtedly the most sought after technological innovation in the world at this current moment. If you are a keen follower of The Bitcoin magazine, you must know we are a avid Blockchain technology supporters.
Not only is blockchain technology the foundation of cryptocurrencies, but there are a ton of other facilities that Blockchain technology provides. As you have decided to spend your precious time reading my article, chances are you want to know what blockchain technology is. Do not worry, as this is going to be a complete guide on what blockchain technology is and how it works.
Do not get intimidated when you hear the word ‘blockchain’; the way it works is way simpler. The buzz that Blockchain technology had been making since its inception back in 2017 has been quite hard to ignore, both for the Government’s large tech companies. So without wasting any time, let us take a look at what the buzz is all about.
Blockchain technology Explained
What is Blockchain technology? To put it simply, Blockchain is a database. Pretty much like all databases, it too is used to store data. But there are some factors that set Blockchain apart from other databases.
The data added in the Blockchain network works on an add the only basis. Data once added in the blockchain technology cannot be edited or altered. Furthermore, it works as a distributed public ledger. When you make a transaction or add an event to its network, anyone on your network will be able to see it.
How Is Data Stored On Blockchain Different From Normal Databases?
The data stored in Blockchain is quite like the way it is stored on spreadsheets. When you are working in an organization, you store data on spreadsheets.
Multiple employees in that organization have access to that spreadsheet and can add, edit and delete the data the way they want to. But this is not the case with the Blockchain. There are a ton of differences in how data is stored on blockchain technology.
Data Composition of Blockchain
The major difference between a normal database and blockchain technology is how data is arranged, stored, and composed. All events and transactions made on the Blockchain are stored in groups; these small groups are also known as blocks. When one block is filled, it is chained to the next block. Hence the name Blockchain.
A conventional database composes its data into tables, rows, and columns; on the other hand, Blockchain composes its data into blocks that are chained together.
The data composing process of the Blockchain technology comes in very handy while trading in cryptocurrencies. I hope now you have got a basic idea of what blockchain technology is and how data is stored in the Blockchain network.
Why is there so much hype around blockchain technology?
There is so much hype surrounding blockchain technology because it is the basis on which data is stored while transacting in cryptocurrency. Blockchain technology allows transparency and lowers the chances of fraudulent activities by a huge margin.
When you perform a new transaction with Bitcoins, this transaction gets added to the Blockchain. The blockchain technology then transmits the transaction to a peer to peer network of computers that are spread all across the world. Those networks of those computers solve a set of complicated mathematical equations and confirm the validity of the transaction you have made.
After validating, your transaction will be deemed as complete. Now the data of these transactions are chained together, which creates a record that is permanent; it cannot be changed by anyone.
Why have industries shown support for Blockchain technology?
A few industries, including the tech industry and the healthcare industry, are planning on implementing Blockchain technology into their networks. This will give you a clear understanding of what blockchain technology is all about.
Blockchain technology provides transparency
Since it stores data as a distributed public ledger, Blockchain technology provides a ton of transparency while in the event of any transaction or just mere information storing.
You need to have a personal node for the Blockchain for all the transactions happening live. Furthermore, data sharing is made simpler in Blockchain technology; healthcare industries can use it and share the data of patients among different medical institutes in real-time.
Ethos of Decentralisation
Blockchain technology is decentralized, which makes data not compromised to theft and hacking. For instance, if a company owns 10,000 computers that work on a single centralized network.
Now, if a virus enters into a single system, all the computers are vulnerable to getting hacked. Working on a decentralized network stops this from happening. I hope you are getting what blockchain technology and all its important details are.
As Blockchain works on nodes, if a node is found faulty, that particular node can be removed and not the whole system of 10,000 computers.
Most sought after technology by Banks
The banking sector is expected to benefit the most if the Blockchain technology is applied. There is a fixed time in which banking and financial institutions work.
The time is usually ten in the morning to five in the evening in most countries. So after that time period, the banking system remains inactive. If someone needs to make a cross-border transaction, then he would have to wait for the next day and wait for the bank to respond in the morning for the transaction.
When Blockchain technology is implemented, cross-border money transfer can be done anywhere and at any time.
There you go; I hope now you know everything that you wanted to know about what is blockchain technology. Blockchain technology is about to bring in a revolution in the tech, healthcare, and banking, and finance industry.
The only con that I personally feel about Blockchain technology is that it’s way too expensive, and industries are not sure whether they would even get back what they would have to invest in the Blockchain technology. Apart from the excessive cost, Blockchain technology is a good innovation.