Blockhain technology is baffling, indeed. With unheard terminologies like decentralization, cryptocurrencies, D-apps, smart contracts, and more, thrown around on the web, it’s made even harder to understand. While cryptocurrencies make a large part of the blockchain industry, it’s not all.
What is blockchain after all?
In simple words, it is a technology that gives you the freedom to not allow anyone to have complete control over your digital assets. Bitcoin is a prime example of it. How? When you send money to your friend or family, your transaction is overseen and monitored by your bank. Your bank is the central authority here. This isn’t the case with Bitcoin. When you send Bitcoin to someone, it doesn’t have to be authorized by one single entity, instead the person whom you send Bitcoin will see receive bitcoin after being confirmed by a network of other users.
This allows blockchain technology to use the term decentralized because multiple users are involved in validating a transaction, instead of just one. This process of validation in blockchain lingo is called mining. And, you earn money by mining. Every time you validate a transaction, you make money.
All the complete transactions of this kind appear on one single comprehensive network –blockchain, or what is commonly called decentralized ledger. This means you can see your friends’ transactions or your friends’ friend transactions as well. This isn’t possible with traditional bank ledgers. DLT (or Decentralized Ledger Technology) is a common term to refer to the above process.
The whole gist here is decentralization. It’s the central factor that has earned blockchain the popularity it has gained today. Based on this aspect, several apps are being built, which are referred to as D-apps, which is short for Decentralized apps. This is one of the common benefits of blockchain, which is utilized by blockchain engineers while building an app.
How else is blockchain technology helpful?
The decentralization aspect brings more transparency to various industry operations. Imagine, for instance, banking, where transactions don’t need to be validated by banks. Another major recent breakthrough of this technology – Libra. Cryptocurrency announced by Facebook, which apparently will help billions of people without bank accounts.
Moreover, blockchain technology brings security.
Major corporations around the world have been vulnerable to hacking. Blockchain offers high- grade security which makes applications built on blockchain more secure. How?
Centralized systems have one access point, which allows hackers to target and corrupt the system to access the entire system. Decentralized systems built on blockchain have multiple access points, which makes it immensely difficult to access the system. Moreover, consensus mechanism required to approve transactions makes record-keeping more effective.
Further, every transaction is encrypted and added to previous transaction, this makes blockchain-based system more secure and temper proof. Any changes made to a transaction is reflected back in the previous records. This lends blockchain-based applications immutability. All applications
Traceability is enhanced with blockchain. All supply chain-based systems can be made more transparent. For instance, you can easily trace each touch point of a commodity throughout its supply chain. When goods are traded on a blockchain network, it leaves an audit trail which can be easily looked up to see any anomalies with the supply chain.
Not to mention, the technology is building a job market as well. The revolutionary attributes of the technology are pushing blockchain development across the industry, which in turn is increasing demand for blockchain engineers.
Putting convenience ahead
Overall, blockchain technology is now driving development of technology solutions that facilitate convenience, making business processes faster and efficient with its futuristic attributes and features.
Today transparency and security have become major concerns for businesses around the world. Blockchain offers exactly the same. Consumers are seeking more transparency and security for their stake and businesses are seeking efficient and more secure processes – per se blockchain makes a win-win choice for both.