Blockchain Technology

If you have been following banking, investing, or cryptocurrency over the last ten years, you may have heard the term "blockchain". Here's something you should know about the record-keeping technology behind the Bitcoin network.

Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. It is a digital record of transactions. It allows for the creation of a decentralized public record of digital information. Blockchains are used for recording transactions made with cryptocurrencies, such as Bitcoin, and have many other applications. It is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain. The name Blockchain comes from its structure, in which individual records, called blocks, are linked in a single list, called a chain. It is often referred to as the "Next Generation of Internet". One of the most famous examples of Blockchain in action is Bitcoin. It is a digital currency (commonly called cryptocurrency)

In the case of Cryptocurrency or to be specific in the case of Bitcoin, the first product of blockchain technology, Blockchain is a public digital/online ledger of all the Bitcoin transactions that have ever been made. It is like a Bank statement/passbook which records all of the transactions. A block is the 'current' part of a Blockchain which records some or all of the recent transactions, and once completed goes into the Blockchain as a permanent database. Each time a block gets completed, a new block is generated. There is a countless number of such blocks in the Blockchain. This means if one block in one chain was changed, it would be immediately apparent it had been tampered with. If Hackers wanted to corrupt a blockchain system, they would have to change every block in the chain, across all of the distributed versions of the chain.

Blockchains such as Bitcoin and Ethereum are constantly and continually growing as blocks are being added to the chain, which significantly adds to the security of the ledger.  

WHY IS THERE SO MUCH HYPE AROUND BLOCKCHAIN TECHNOLOGY?

There have been many attempts to create digital money in the past, but they have always failed. The prevailing issue is trust. If someone creates a new currency called the 'X' dollar, how can we trust that they won't give themselves a million 'X' dollars, or steal your 'X' dollars for themselves?

Bitcoin was designed to solve this problem by using a specific type of database called a blockchain. Most normal databases, such as an SOL database, have someone in charge who can change the entries (e.g. giving themselves a million X dollars). Blockchain is different because nobody is in charge; it's run by the people who use it. What's more, bitcoins can't be faked, hacked, or double-spent - so people that own this money can trust that it has some value.

Blockchain has many varied applications, and here are some examples:

1. Bitcoin: One of the most famous examples of Blockchain in action is Bitcoin. It is a digital currency (commonly called a cryptocurrency)

2. Spotify: Following the acquisition of Mediachain Labs in late 2017, Spotify is using a decentralized database (blockchain technology) to correlate artists with license agreements and tracks.

3. Maersk: A cooperative Blockchain effort called TradeLens has been created by Maersk and IBM.

4. Aeternity: Aeternity is a scalable Blockchain platform, that can be used for many applications requiring high-speed transactions.

5. Matchpool: The Matchpool platform incentivizes 'matchmakers' to connect members of communities such as Airbnb, Uber, or dating services.

 

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