What is the first thing that comes to your mind when your hear the word Blockchain? Is it Bitcoin, or any other form of cryptocurrency. Well, generally people associate Blockchain as a technology used in the cryptocurrencies. However, what they don’t know is, Blockchain is a revolutionary technology that has the capacity to drive the future innovations. It is touted as the next big thing after the internet by some.
Although new in the world of technology, Blockchain has already gained enough hype to bring it to the notice of people across the globe. Incepted in 2009, the technology today has a plethora of applications across various industry verticals. This has made the people interested in knowing how the technology works and how it can be used for their benefit. However, to understand how this revolutionary technology works, it is imperative that you know about what the technology is about.
What is Blockchain?
In simple terms, a Blockchain is a time-stamped series of digital data records that is managed by a series of computers that are not owned by any single entity. There is no central body that governs anything that is stored in a Blockchain. Each of the data blocks present in a Blockchain is bound and secured by cryptographic principles.
So, what is so special about this technology and why is it gathering such hype across all the industry verticals?
Well, the most fascinating aspect of Blockchain is, it has no central regulatory body or authority. It is a digital shared ledger which is open for everyone and anyone to see. However the information or data stored in Blockchain is immutable ledger, which means that it cannot be changed or deleted. This is why, anything built on Blockchain is very secure, although it is transparent and can be viewed by anyone.
Blockchain is a very convenient and ingenious way of passing data and information from one point to another without worrying about its security. It is basically a transaction that happens and involves two or more parties. One party needs to initiate a transaction by creating a block which then starts the process. The block is then verified by thousands of computers distributed all across the internet. Once the block is verified, it is added to a chain, which is then stored across the internet, or in some cases in Blockchain wallets (especially in the case of cryptocurrency transactions).
This not only creates a unique record that can be viewed by everyone, but it also creates a record with a unique time stamp that can tracked whenever required. The complex structure of Blockchain means, any change to any of the blocks of data will lead to change in the entire chain, which is virtually impossible. This is why the technology is termed to be the safest and almost impossible to hack, and that is the reason why Blockchain is believed to be the future of monetary transactions.
Working of Blockchain
As you already know Blockchain involves transaction, the process starts with a node starting a transaction by digitally signing it with a private key. The transaction is then circulated across various systems and peers that validate the transaction based on the pre-approved criteria. After the validation is done by various systems, it is included in a block, which is then circulated onto the network. This is the point where the transaction is believed to be confirmed.
Now the newly created block becomes part of the ledger and the next block links itself to the block cryptographically. This next link is known as a hash pointer. Once the hash pointer is added the block is again confirmed, which continues with the addition of every new block. Usually, there are six confirmations required to consider a transaction final. Once the transaction is complete the data stored in the block can be viewed by anyone, but cannot be changed or deleted.
Uses of Blockchain
Now that you know what a Blockchain is and how it works, you might be interested in knowing some of the uses of Blockchain.
- Cryptocurrencies - This is the most popular way how Blockchain is used. In fact, Blockchain was introduced to the world through Bitcoin - one of the most popular cryptocurrencies.
- Data management - Since it is a distributed ledger, Blockchain can be used to gather and store information that can be accessed from anywhere and at anytime.
- Financial transactions - Financial transactions can be made very secure through Blockchain.
- Smart contracts - Blockchain can be used for contracts, which will ensure that the transactions and payments are done in time without any hassles.
Above mentioned are just some of the applications of Blockchain. Today, the technology has grown to be used by governments, IT companies, banks, and various other industry verticals. In fact, the demand for Blockchain professionals has been greater than ever, thanks to the various applications of the technology. So, if you are intrigued by this revolutionary technology, this is the right time to learn about it and start your career in Blockchain. All you need to do is find the right Blockchain certification courses, clear the certification exam and move towards a great career.