What is Blockchain?

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What is Blockchain?

“Giving users easy access to many different kinds of digital assets on the blockchain and, particularly, tokens that are linked to assets in the real world, is crucial to seeing blockchain adoption reach the next level, and I applaud Digix Global’s initiative in being the first of many such projects to successfully launch”

– Vitalik Buterin  

Blockchain is the technology of the future. It has unlimited possibilities and a huge potential for application in various spheres – politics, banking, finance, economics, education, science, genetics, recruiting, etc. Blockchain is the underlying technology of all modern cryptocurrencies. We often try to search blockchain wiki in order to understand the mechanism of work of the blockchain technology. Blockchain, as we understand it today, was introduced in 2009 with the idea of Bitcoin. Since 2009 it has been spreading around the world. It is impossible to understand, what is Bitcoin without understanding its underlying technology – blockchain.

Blockchain versus Wikipedia

It makes them fully decentralized, independent and anonymous. It is worth comparing the blockchain technology with Wikipedia. Wikipedia is a multilingual, Internet-based free encyclopedia. It is written by the Wikipedia users, so everyone can become an editor of the largest e-encyclopedia. Likewise, Blockchain also does not have a single editor or controlling person. Each blockchain user can check how the record of data is changed or updated. There is no central server or authority, which controls blockchain. Both Wikipedia and blockchain are Internet-based. However, Wiki is built in WWW (the World Wide Web). It means that each Wiki user is authorized to make amendments to the data stored on a special server. This is what we calla client-server network type. Wikipedia has a central server and a group of administrators, who control the changes made. Thus, the Wiki users only work with a master copy, which needs central authorities’ approval.

It is important to note that Wikipedia’s digital backbone is similar to the collections of data that are used by most modern banks, governments or other institutions all around the world. Thus, the most important updates, changes or security issues are managed by the central authority. What is the digital backbone of blockchain? How is it different from most modern systems, including Wiki? What makes blockchain so unique? There is no “master copy” in the blockchain technology. The most popular record automatically becomes an official record.

Blockchain major features

Blockchain ensures cooperation between the two users, their digital “communication” without involving any third party or intermediary. This idea is truly revolutionary and solves a number of important issues in finance, banking, economics. Private keys cryptography makes the process of interaction safe and secure. It is probably the most powerful innovative ownership instrument. A person who owns a special private key generated with the help of blockchain technology has a right of ownership. Private keys protect from hacker attacks and scams.

However, the technology of cryptography is not enough to create a blockchain. Blockchain is supported by a fully transparent and independent Peer to Peer (P2P) network. Peer to peer means that only two users are involved in the process of communication and no one controls them. P2P platform, which has a distributed, decentralized and transparent character protects blockchain from being monopolized, corrupted or scammed.

“Transactions are broadcast, and every node is creating their own updated version of events”,

Nolan Bauerle.

This unique feature makes blockchain so advantageous and effective. The mechanism of data recording and circulation that excludes the need for a third party to control the whole process. It is interesting that blockchain is not a brand new technology, created in the 21stcentury. Blockchain is rather a mix of well-established technologies used in a different way. Blockchain combines a successful application of the Internet, the technology of cryptography and protocol authorization. It was Satoshi Nakamoto, who decided to combine well-known technologies in a different way. This is how he came up with the concept of Bitcoin and blockchain.

The major features of blockchain – authentication and authorization also have a profound impact on its functioning. Cryptography ensures authentication; authorization is ensured by Peer to Peer network. Thus, blockchain is a successful combination of different important technologies and features.

Blockchain in other spheres

According to the experts from Transparency Market Research, the technology of blockchain will completely change the world in five years. In 2024 the global blockchain market will grow to $ 20 billion. Blockchain technologies will help the research centers to keep all this information in one transparent chain. This technology will help to solve many important problems, connected to the authorship and plagiarism.

Nowadays financial transactions are the most common direction for development. However, there are other industries that will soon change the blockchain industry:

  • Supply Chain Management;
  • Management of personal data;
  • Advertising in retail and e-commerce.

The technology of blockchain can improve the process of recruitment. The next breakthrough in HR Tech will happen precisely through decentralization. Now there are three serious problems in the labor market HR system that can be solved by the blockchain.

  • bitcoinBitcoin$5,003.02
  • ethereumEthereum$162.95
  • rippleXRP$0.323215
  • tetherTether$1.00
  • eosEOS$5.24
  • stellarStellar$0.112814
  • litecoinLitecoin$77.10
  • cardanoCardano$0.080814
  • tronTRON$0.025901
  • moneroMonero$66.73
  • iotaIOTA$0.314376
  • nemNEM$0.063279
  • dashDash$119.08
  • neoNEO$10.90
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