What is Blockchain Technology and how does it work | Cryptocurrency and Technology
|What is Blockchain Technology and how does it work|
What exactly is Blockchain Technology and How does it work?
Gain knowledge about the fundamentals of blockchain technology and how it can improve the trustworthiness of both data and financial activities.
Blockchain would be a method of storing data which makes it extremely difficult to alter, hack, or cheat it.
The blockchain is essentially a digital log of transactions that is duplicated and distributed throughout the blockchain's complete network of computers. Each block on the chain contains some transactions, and whenever a new transaction occurs on the blockchain, a note of that transaction is added towards the register of every member. The term "distributed ledger technology" relates to a decentralized database that is managed by different people (DLT).
Blockchain is a sort of distributed ledger technology (DLT) wherein the transactions are recorded using a hash, which is an immutable cryptographic signature.
This implies that if a single block in a network is modified, it will be immediately clear that the chain has been tampered with. Hackers would have to modify every transaction to the blockchain, throughout all distributed copies of the chain, if they intended to destroy a blockchain system.
Blockchains like Bitcoin and Ethereum are currently growing as new blocks are added to the blockchain, increasing the overall security of such records greatly.
Why is Blockchain Technology so popular?
There have been previous attempts to create digital money, but they have all failed.
The main issue would be one of trust. How should we be sure that if someone invents new money called the X dollar, they won't award themselves a million dollars or take your X dollars?
Bitcoin was created to address this issue by utilizing a blockchain database. Usually, regular databases, which include SQL databases, contain a manager who can make changes to the data (e.g. giving themselves a million X dollars). Blockchain is unique in that no one is in control; instead, it is run by the individuals who utilize it. Bitcoins can't be verified, hacked, or double-spent, so those who hold them can believe that they're worth something.
Credit - Komal Sharma, Direct News 99