What is Blockchain Technology
Ever wonder if there is an easier way to complete transactions without having to deal with online wallets banks and third-party applications. Well, it is possible.
Thanks to blockchain here are everything you should get to know about blockchain. Imagine four friends Jack, Ted, Sam, and Phil meet up for dinner after they’re done, Jack pays the bill and all of them decide to split the expense amongst each other.
Now on the next day when Phil sends his chair to Jack via online money transfer the transaction goes through without a hitch. Then Ted and Sam and their respective shares to Jack but their transactions don’t go through the failed transaction sites. Some issues at the bank that when Jack comes to know about the many ways a bank transaction could fail.
It could be due to technical issues at the bank one of their accounts were hacked daily transfer limits being exceeded.
Sometimes additional charges like transfer charges associated with transferring money to solve these problems. The concept of cryptocurrency came into existence cryptocurrencies are a form of digital or virtual currency that runs on a technology known as the blockchain.
- Thanks to blockchain cryptocurrencies are immune to counterfeiting don’t require a central authority and are protected by strong and complex encryption algorithms.
- In a market of more than thousands of cryptocurrencies like bitcoin aetherial cache and so on one reigned supreme bitcoin now.
Simply Learn About Blockchain Technology
Let’s go back to our previous example and have filled Ted and Sam Sann Jack to bitcoins each as their contribution to the previous night dinner. Let’s assume fill Ted and Sam have three bitcoins in reserve. While Jack has five first Phil Simms two bitcoins to jack a record is created in the form of a block the transaction details between them is permanently inscribed in this block this record. Also holds the number of bitcoins each of the friendzone.
So after Phil s transaction jack has seven bitcoins while Phil has one following this Sam and Ted and two bitcoins to Jack a new block is created for each of these transactions these blocks hold the transaction details as well as how many bitcoins Sam Ted and Jack have in reserve.
- These blocks are linked to each other as each of them takes reference from the previous one for the number of bitcoins each brand owns this chain of Records or blocks is called a ledger.
- And this ledger is shared among all the friends which act as a public distributed ledger this forms the basis of blockchain.
So what happens when Phil has only one Bitcoin left and he tries to send two more bitcoins to Jack the transaction will not go through this. Because all his friends have copies of the ledger and it’s clear that Phil has only one Bitcoin left his friends will flag this transaction as invalid a hacker will not be able to alter the data in the blockchain.
Advantages of Blockchain Technology
Each user has a copy of the ledger the data within the blocks are encrypted by complex algorithms. All of this is made possible with the help of blockchain technology. Blockchain can be described as a collection of records linked with each other strongly resistant to alteration and protected using cryptography. Most Best Laptops Reviews Websites are using Blockchain Technology. Now let’s have a closer look at the Bitcoin transaction between Jack and Phil and find out how it works every user in the Bitcoin network has two keys a public key and a private key.
How Blockchain Technology works
The public key is an address that everyone in the network knows of like an email address of a user.
- The private key is a unique address that only the user has knowledge of something like a password first bill passes the number of bitcoins he wants to send to Jack along with his and Jack s unique wallet address through a hashing algorithm.
- All of this is part of the transaction details these details are encrypted using encryption algorithms and using fills unique private key. This is done to digitally sign the transaction and to indicate that the transactions came from Phil this output is now transmitted across the world using Jack s public key with this the message or transaction can be decrypted only by Jack s private key.
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Which only jack has knowledge of different cryptocurrencies use different hashing algorithms while Bitcoin use is the best algorithm etherium which is also a famous cryptocurrency uses one known as ether this transaction and several other similar ones are taking place all around the world.
These transactions are validated and then added block by block the people who validate these blocks are called miners for a block to be validated and added to blockchain miners need to solve a complex mathematical problem the miner. Who solves this first adds the block to the blockchain and is rewarded with bitcoins the process of solving the complex mathematical problem is called proof of work.
Now that you know about blockchain and it’s important concepts time for a small quiz what is the concept of a blockchain that ensures data cannot be altered by any of the users within the network.
A public distributed ledger be proof of work see proof of stake D hash encryption.
Walmart Using Blockchain
Let s have a look at how Walmart uses blockchain to provide its customers with better service.
Walmart was facing problems in delivering quality products to its customers they were facing a high return rate and large amounts of refunds due to their products bad quality.
They were unable to determine the point of failure in the supply chain which started from farm to storage to transportation to processing.
All the way to the customer then Walmart adopted blockchain technology with blockchain the quality of the goods.
At each step was permanently inscribed within a block. For example, when a customer Flags a product has damaged it can be correctly identified where the product got damaged in the entire supply chain.
Thus helping Walmart to identify the problem areas and fixing them this is just one of several ways blockchain is used in real-life applications.
Can you think of any others let us know in the comments down below that s all for now thank you for reading and stay tuned for more you
