fbpx
CryptocurrencyIntroducing Blockchain

Introducing Blockchain

-

Back in the day, we use pen and paper to record down the important information that was related to the business. It was proven to be highly unreliable as things can get lost in the transactions, information can be misinterpreted by the person who was recording it, the lodge book might go missing, and such.  

After some decades, we came up with a computing technology to manage all this stored information and minimizing the flawed human resources in this aspect. However, following the advancement of technology, these computer systems are susceptible to hacking and information can be retrieved or altered by an unauthorized third party. All these contributed to the risk of having the information leaked or compromised which could jeopardize the whole operation. 

Blockchain is the new way of storing and recording information. This system is virtually unhackable and it is safe for sizable organizations to keep their enormous amount of information. To better understanding what blockchain is, see it as a new form of a database. It stores information just like the common databases but with more refined and secured features. Databases are designed to accommodate a substantial quantity of data and information that can be retrieved, processed, and accessed by authorized users at any given point of time. Blockchain is advantageous in a few notable characteristics.  

Structure of the storage 

The way that the data is constructed is one of the biggest and most distinctive differences between blockchain and the common database. Blockchain collects the information and clusters them into blocks. These blocks of information have a capacity. After it is filled, they will be added to the previously formed block of data and form a data chain. The new information that comes in after will fill up the block which then will be added to the chain after the storage capacity is filled. This system permanently creates an unchangeable timeline when the data is created. Everything will be fixed once the block is filled and becomes a part of the data chain. Every block is given a timestamp at the point when it is added to the chain.  

To better understand the concept of the structure, let’s take a Bitcoin transaction as an example. It all started with a transaction being entered into the system. The transaction will then be sent into a network of computers spreading across the globe. The network of computers will then validate the transaction through some equations. The transaction will then be added to the cluster after proving to be legitimate. The clustered block will then be included in the chain of a long history of all the transactions that are irreversible. After that, the transaction is completed. 

Decentralization 

Unlike the typical database system, blockchain does not operate with computers under one roof, the computers are all operated and managed by different individuals or groups of individuals. To illustrate the difference, think of a company that has over 1,000 computers storing all the client’s details and information. All these computers are situated in a centralized location and have full access to all this information. Blockchain is ‘decentralized’ in the sense that all the computers governing the information are scattered in computers all over the world, under different roofs, with different accesses. All these computers from different geographical locations make up the network are called nodes. Generally, blockchain is used in this decentralized way but centralized and exclusive blockchains do exist too.  

Every node has a complete record of the information that is kept in the blockchain since its establishment. If there is an error occurring in one of the nodes, it can use the other thousands of nodes as a point of reference to right itself. If a user meddles with any data, the other nodes will cross-reference each other and identify the node with the inaccuracy and perform self-correction to amend the errors. In this sense, a node within a network of nodes cannot be overwritten or altered. Thus, making the information stored more secured and unchangeable. To alter the information housed within, the majority of the nodes have to agree on such changes, this is to ensure that the changes made are all done in the best interests of most parties. 

Transparency 

Refer back to the point aforementioned, the decentralized quality of blockchain makes the data transparent. Anyone can view either by using blockchain explorers or a personal node. Every node has its copy of the chain information which will be updated in realtime as new blocks of data are added.  

Take Bitcoin as an example, a user is able to track their Bitcoin transactions wherever it goes if they wanted to. In the past, before blockchain was fully utilized, there were reports of exchanges being hacked and the Bitcoin holder lost everything. With blockchain, while the hackers are anonymous, the Bitcoins that are taken out can be easily detected. If the stolen Bitcoin is employed somewhere, we would know. 

This blockchain technology is still at its beginnings, there is much more to explore and refine before more conglomerates and organizations can make use of and implement this system. What is certain is that this is the new way of managing and controlling the tremendous amount of exposed information.  

Latest news

There’s a chance China might finally put taxes on property

Chinese officials are inching closer to taxing people owning properties, say analysts. The move began almost two decades after...

Facebook changes name to Meta

Social networking giant Facebook Inc. recently announced a name change. The company is now called Meta, as announced through...

China’s central Bank mentioned cryptocurrency-related activities are illegal

The Central Bank of China sounded the death knell for cryptocurrencies and digital trade. The Bank announced that every...

China has ability to address Evergrande situation, still risks remain

China has ability to address Evergrande situation, still risks remai Evergrande Real Estate Group is China’s second-largest developer of property...

Analyst Aaron Pang Dao Chang reports the impact of Hopson’s 51% stake in Evergrande

Evergrande’s $305 billion liabilities is equivalent to 2% of China’s gross domestic product. Although Beijing continues to say little...

What are people thinking about Evergrande’s financial situation?

Evergrande, a Chinese property behemoth, is on the verge of bankruptcy, and experts warn that the repercussions might have...

Must read

Time To Get The Knowledge About Gold You Need

Most serious investors have a slice of their overall...