These days, data storage and data transit via blockchain are dependable and secure. Blockchain’s decentralized nature—everyone having power over a piece of information—is the primary factor contributing to its security. You may have no idea about it. Let’s investigate this in more detail.
What Is Blockchain
Blockchain is the most efficient and secure data storage method ever invented. Now information can be stored in many ways. Just like when you write down a piece of information on a piece of paper, it is also a method of storing information. Again, you can save the data in Microsoft Excel.
The thing to note here is that when you save data in Microsoft Excel, that data will be saved in table form. Similarly, blockchain data is stored as blocks. Three elements constitute a block.
The first is data or information, like sender, recipient, or amount, etc. The second thing is a Hash, which is the fingerprint of a block. That is, each block can be identified separately through this Hash. Every block has a separate hash.
The third is that each block stores the hash of its previous block. That is, there are three things in a block: data, hash, and the hash of the previous block.
Blockchain is managed through common P2P computer networks. Now P2P means a network where one node is connected to another node.
How Does Blockchain Work
Blockchain, in simple terms, is a distributed open ledger. Let’s say it in simpler terms. We find that various offices-courts have a large ledger in which various information is recorded. This ledger is called a ledger, which cannot be seen by anyone except the office staff. Transactions made using blockchain are stored in a ledger on ChainSteam, which everyone can see. Think, I will send bitcoins to a person if I get any information or easy to understand via blockchain. Then when I send that person’s address, my transaction will be taken in a block. The block is then enclosed in a (#) hash for security purposes. And one block is connected to another.
Each block contains the address of the previous block, thus linking one block to another block. On the other hand, all the transactions that happen at the same time are put into a block. And the block which is created first and the hash of any other block is accumulated in the block is called a genesis block.
And for this reason, we can see the history of any block at any time. I can see what is happening in which block. Due to which all the blocks are very secure, and no one can change the information of any block at will because if the information of a block changes, then the hash of that block will change with that block’s hash as the next block’s hash is associated with it. So, the hash of the next block of that block will also change. And thus, the data of all subsequent blocks of that block will be lost. So, no one can change any block information at will.
For which thousands of computers work. And a duplicate of that block is on every computer. This is the process of building strong chains or networks. And ledgers are the records that are kept for later use along the chain. Blockchain technology is the way of the future.
Types of Blockchain
Blockchain is basically of four types:
Public Blockchain:
Public blockchains are by nature open and unlocked. Anyone can join this network without permission, and the network is completely decentralized. Public blockchains give all its nodes equal rights and permissions to access the network, create new blocks of data, and verify blocks of data. Bitcoin. Ethereum, etc., are examples of public blockchains.
Private Blockchain:
Private blockchains are typically blockchains controlled by a single entity. Joining such blockchains is typically permissioned. In a private blockchain, a central authority determines who can be considered a node. Private blockchains are only partially decentralized, as public access to these blockchains is restricted. Examples of public blockchains include B2B virtual currency exchange networks Ripple and Hyperledger.
Consortium Blockchain:
A consortium blockchain is a type of permissioned blockchain, managed by a group of organizations rather than a single entity. Consortium blockchains therefore enjoy greater decentralization than private blockchains, resulting in stronger security.
Hybrid Blockchain:
Hybrid blockchains are controlled by a single entity but have significant oversight over public blockchains. It requires integration with the public blockchain to properly resolve transaction validation. These hybrid blockchains can be very useful in the food and consumer safety sectors. The IBM Food Trust Hybrid Blockchain is a classic example.
What Benefits May Blockchain Technology Offer
The advantages of blockchain technology are actually in all areas. We always go to a 3rd person. Take a bank for example. We trust banks to deposit money and save for life. Here, the owner of the bank can change everything in my account and give the money to someone else’s name if he wants because your data is stored in a specific server in banks.
You are dependent on the bank as all your information is with them. Again, from here another person can hack and change all your information. If they want to turn you into a beggar, it won’t take long.
However, the blockchain system distributes all the transaction data through ledgers.
If a person wants to change this data, then all distributed store data must be changed. Again, the blocks of these distributed data are locked. And if you want to see the data of the locked block, all the data becomes invalid. So even if you try a thousand times it is never possible.
Below we mention some of the Advantages of Blockchain Technology
1. Security: Blockchain technology can provide maximum security online, especially in the case of money transactions.
2.Decentralized Store: All the data in blockchain technology is distributed, so there is no fear of data theft or hacking.
3. Fast transaction facility: Transactions can be done in a short period of time using blockchain.
4. Economic Benefits: Blockchain will benefit you in many ways, including not only financially but also in healthcare.
5. Transaction Facilitation: Since ancient times, people have been collecting money from third parties for transactions, but this technology is a peer-to-peer network. So, you don’t need anyone except the person you deal with.
Disadvantages of Blockchain Technology
Just like everything has a good side, everything has a bad side. Blockchain also has a downside. Blockchain consumes additional power and is not a massively distributed computing system. The fact that blockchain is unchangeable and unbreakable is one of its main issues. Moreover, blockchain is a commercial technology. The bottom line is that this technology needs more time to come into mainstream use.
Use of Blockchain
The biggest use of blockchain in the real world is in cryptocurrency. Cryptocurrencies like Bitcoin are completely dependent on the blockchain. Also, if you want to hear a different example, let us tell you. But nowadays it is very easy to forge certificates. Some are becoming engineers without studying engineering and some are becoming doctors without studying medicine. Because creating fake certificates has become very easy now. But think that all the certificates are stored online by the Ministry of Education through blockchain, but no one can make fake certificates at will. Because we know that blockchain is impossible to change.
Likewise, if the use of blockchain continues to increase in all areas, then frauds will decrease a lot. And this kind of initiative has already started to be taken in other countries including our country. Here is a hypothetical example. Let’s take a look at some real-world examples of blockchain being used today:
Money Transfer:
Transferring information through blockchain is much more secure and less expensive. Moreover, data can be transferred much faster through blockchain, which is one of the best aspects of blockchain. That is, money can be transferred faster through blockchain.
NFT:
Since blockchain prevents data from being altered, placing an NFT on the blockchain guarantees that only one copy of a piece of digital art exists. And since NFT means that it will be unique, that’s why the importance of blockchain in NFT is immense.
IoT:
The Internet of Things (IoT) is making our lives easier, but it’s also opening the door for hackers to access our data or take control of critical systems. And in this case, our passwords and other information can be stored securely by using blockchain technology.
Vote:
If personal identity information is kept on the blockchain, it puts us just one step away from being able to vote using blockchain technology. Blockchain technology is used to ensure that no one votes twice, and only eligible voters will be able to vote. And most importantly, the vote cannot be rigged.
There are many technologies that are using blockchain technology and the number will increase in the future.
Name 10 Blockchain Applications
Learned about what is blockchain, its advantages and disadvantages, and its use in the real world. However, a few applications using blockchain are yet to be known. Let’s find out that too.
1. Chainalysis
2. Circle
3. Algorand
4. Chain.io
5. Dfinity
6. BurstIQ
7. Mediachain
8. Propy Inc
9. HYPR
10. Xage Security
Hope you have learned a lot about blockchain by reading the article. If you still have any queries, then you can let us know.
