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What is blockchain and how does it work?

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After all, what is Blockchain? Bitcoin has been in the news for a long time recently. People have a lot of hope about Bitcoin because the price of Bitcoin is increasing day by day. But do you want to know what is the technology behind Bitcoin? If yes then you will definitely like what this Post Blockchain technology is. Why Bitcoin is related to Blockchain , so you have to know about Blockchain, how it works. Now the question arises that do you know what is Blockchain Technology in hindi? Why is it important to know about it?

Blockchain technology is going to change our IT industry the way open-source software did a decade ago. And the way LinuxBlockchain has been the origin of modern application development for almost a decade, just like Blockchain is going to be a very good way of sharing information in the coming time, which will be lower cost and can be implemented easily. between open and private networks. But there was a lot of hype among the people about Blockchain Technology, because they felt that it could completely change our future technology. This is also true to a large extent, but speaking like this will not make sense, rather we will have to understand Blockchain Technology completely, think about its different aspects, we will go somewhere else to get better than current technology. 

Blockchain is a digital ledger. But do you know what Ledger is? Ledger is a book that maintains an account where debits and credit transactions are posted from the book where the original entries are. Or simply say that entries from the original book are updated in this ledger.

We can say that a blockchain is digitized, decentralized, public ledger .

Understand Blockchain Technology in easy words

Suppose you have a file of transactions (a ” node “) in your computer (a ” ledger “). Two government accountants (whom we call ” miners “) also have the same file in their system (so they are ” distributed “). As soon as you conduct a transaction, your computer e-mails both those accountants to inform them.

Every accountant wants to check as soon as possible whether or not you can afford it (and in return they can get their salary which is “Bitcoins”). Whichever of these two checks first and finally presses “REPLY ALL” to validate it, while at the same time it also attaches its logic to verify that transaction and this is the “Proof of Work”. Is called If that other accountant also agrees, then everyone updates their files of transactions…. This whole process or concept is called “ Blockchain” technology .
So blockchain is an incorruptible digital ledger of transactions that is programmed to record virtually everything. All the list of records which are in the blockchain are called “blocks”. So this blockchain is always a continuously growing list of records which are linked and secured.

Who invented Blockchain Technology?

Blockchain technology was invented by Satoshi Nakamoto in 2008 to do it in cryptocurrency bitcoin, according to its public transaction ledger. The main objective of Satoshi Nakamoto to do all this was that he wanted to create a decentralized Bitcoin ledger — the blockchain — that gives people the ability to control their money so that any third party, or any government also could not access or monitor these funds.

Satoshi, the creator of Bitcoin, suddenly disappears in 2011, leaving behind this open-source software that Bitcoin users can use and update and improve. Many believe that there is no person named Satoshi Nakamoto, it is just this fictional character. By the way, correct information is not available to anyone even beyond its truth.

The invention of blockchain for bitcoin is the first digital currency that can solve the double spending problem without the help of a trusted central authority or central server.
Therefore, this blockchain technology has also been an inspiration for many other applications.

Why should we know about Blockchain?

There are three main reasons why we should know about Blockchain:

1. There is no need to publicly exist Blockchain technology. It can also exist privately – where nodes will be just points in a private network and Blockchain will act as a distributed ledger. Financial institutions are under tremendous pressure as they have to demonstrate regulatory compliance and hence many institutions are implementing blockchain. Secure solutions such as Blockchain can become a very large and important building block to reduce compliance costs.

2. Block-chain technology has more reach than finance . It can be applied in any multi-step transaction where traceability and visibility is required. The supply chain is one notable case where Blockchain can be used to manage leverage and audit sign contracts and product provenance. In addition, it can also be used for voter platforms, titles and deed management. As digital and physical worlds are converging, the practical applications of Blockchain are also increasing gradually.

3. The exponential and disruptive growth of Blockchain can only occur when public and private Blockchains converge (meet) together in an ecosystem where firms, customers and suppliers can collaborate together in a secure, auditable and virtual way.

How Secure is Blockchain?

In this way, nothing on the internet is secure. On the other hand, if we talk about Blockchain technology then it is ” unhackable ” to a great extent compared to the rest of the technology. To perform any transaction in Blockchain, all the nodes of the entire network have to agree, only then will the transaction be valid. Here a single entity cannot say whether the transaction has taken place or not. To hack it, you will not have to hack only one system like a bank but you will have to hack all the systems in the entire network, so hacking is not such an easy thing in this technology.

Often the computing resources of all the blockchains are very tremendous (more) because there is not one computer here but a lot of computers are connected in the network.

Email for Blockchain like Bitcoin was like that for Internet

In the 1990s, when internet technology ( TCP / IP or HTTP ) was in its native stages, email was a very large and first major application. But later new applications such as web browsers came. Websites became very popular then. People used to use chat software such as Skype a lot. If we think about now, then you can see many different applications running in your mobile, which use the Internet.

Similarly, when blockchain technology came new, bitcoin was also the first major major application like email which used this technology. Other cryptocurrencies followed this trend later. Now blockchain technology is used in many applications such as security, online voting, etc.

Internet Technology vs Blockchain Technology

If we talk about both technology, then Internet allows computers to exchange information; Blockchain allows computers to record information.
Both use a lot of computers ( nodes ).

Let us know something new about Internet and Blockchain.

The first generation of Digital Revolution brought the Internet of information to us. The second generation – which is powered by blockchain technology – introduced the Internet of value to us: it is a new platform that will reshape the world of business and make the old order of human affairs even better.

Blockchain is such a vast, global distributed ledger and database that is running continuously across millions of devices and is open to anyone, not only information but anything that has some value like money, titles, deeds, identities , Even votes – they can be moved, stored and managed securely and privately. To establish trust here, mass collaboration is needed and some clever code to implement it, while old methods require powerful intermediaries such as governments and banks.

That is why we can say that Blockchain technology is made by us, works for us and it is the people who control it, which makes it very secure and reliable.

Technology Behind Blockchain Technology

The main technologies behind Blockchain are mainly the three given below.
1. Private Key Cryptography
2.  P2P Network (Peer-2-Peer)
3. Program (the blockchain’s protocol)

Why do we need blockchain technology?

Blockchain is a mechanism that helps all of us reach our highest degree of accountability. There will be no more missed transactions, it will reduce human and machine mistakes, behind all these transactions, no third party or government’s consent is required but only the trust or secure validation of all connected nodes is maintained.

The most critical area where Blockchain helps us and provides a guarantee is that by recording the validity of a transaction, it is not only being done in a main register but in all the distributed system registers connected in the network , in all these registers Only after secure validation , Transaction will be called valid.

Blockchain technology applications in the following areas in the future:

1.   Smart contracts – Any industry if it relies heavily on contracts, such as insurance, financial institutions, real estate, construction, entertainment, and law, all those industries will be benefitted with this technology. Because with the help of this technology all your contracts can be updated, managed, tracked and secured without any dispute. Smart contracts, which are embedded with if / then statements and which do not require the involvement of the intermediary party to execute.

2.   Supply chain management – Whenever a value changes or the status of an asset changes, then blockchain is a very good option to manage all this process.

3.   Asset protection – Whether you are a musician who wants to get the royalties of your songs properly or you are a property owner, blockchain technology can help you a lot if you want protection of your asset. By creating an indisputable record of ownership.

4.   Personal Identification – Governments often manage a lot of amounts of data such as personal data from birth to death records, marriage certificates, passports and census data etc. Blockchain technology can easily manage all these data according to the streamlined solution and can store them securely.

5.   Payment processing – This is the specialty of Blockchain that it can easily handle the payment processing of any big company. This can completely eliminate the need for intermediaries, which we often see in payment processing.

6.   Crowdfunding – A blockchain powered crowdfunding campaign is a much safer investment than a traditional crowdfunding from an interested community for a new project. But in such an instance, funding will be mainly in the shape of bitcoin or other cryptocurrencies.

Real-life Applications of Blockchain Technology

Now you must have understood the basic concept of this technology, so let’s now know where in the end it is used in real-life applications.

1.  Follow My Vote: It wants to change our ways of voting and wants to be the first open-source online voting solution in the world.

2.  Arcade City: – This is a true decentralized ridesharing service which is also known as ‘Uber killer’.

3.   ShoCard: – It stores your identity in Bitcoin’s blockchain for easy verification.

4.  Symbiont: – It provides better smart securities in Blockchain.

5.  Bitnation: This is a “Governance 2.0” initiative which seeks to establish DoItYourself governance by working with a collaborative platform.

6.  ChainLink: It uses blockchain technology to verify and validate authenticity and title of real-world items.

What is Public and Private Blockchains and what is the difference between them

Although there are many varieties of Blockchain but all of them fall mainly into two categories – public or private. Public blockchains give opportunity to anyone to see and send transactions as long as they are part of this consensus process. They are also consortium blockchains, where only a few pre-selected number of nodes are authorized to use ledger. For example, a group of banks and their clearinghouse blockchain are used as part of trade-clearing, where each node is associated with some step in the verification process.

In private blockchains , in contrast, writing in a distributed ledger puts restriction in any group of employees who work in that organization. Along with this, there are other restriction in it.

Along with this blockchain – due to its self-policing security – it eleminates a large amount of record keeping, which becomes very confusing later when multiple parties are involved in the same transaction.

Blockchain Technology – opportunities and advantages

  • This blockchain helps our smart devices communicate with each other so that they can communicate better.
  • Blockchain solves the problem of manipulation. This brings all things to their highest degree of accountability.
  • Makes online identity and reputation decentralized. So that we can own our data ourselves.
  • Cryptocurrencies share the inability of the government to control the value of currencies to the general public, so that no one will have the hand over the value of currencies.
  • In an informal economy, blockchain protects us from middleman, so that exchange of assets can be done in an easy and free manner.
  • With the help of blockchain technology, many issues related to freedom, jurisdiction, censorship, and regulation can be addressed correctly and smoothly.
  • With blockchain-based systems, there is no need to keep intermediaries anymore, but records and transfer of assets can be easily taken care of. Which increases the transaction speed.
  • The data that are entered once become immutable in the blockchain, which can no longer be changed in any way, which reduces the situation of fraud to a great extent. Apart from this, the transactions are very clear which can be easily investigated and audited later.

Blockchain Technology – Criticisms and Challenges

By the way, there are many advantages of Tapa Blockchain Technology, but still it also has some drawbacks, about which we know.

A lot of power is required: a lot of computing power is required in the operation of these blockchain, due to which the requirement of electricity is very high. If we look at the situation of today’s climate change then it is not so easy in favor of any developing country because they also have their own needs. Therefore it is only true for developed nations.

Security of private key : This private key should always be kept secret because if the third parties came to know about it then it happened that you have given control of all your bitcoin in their hands. Apart from this, the private key should be backed up and protect from accidental loss, because if it is lost once then no one else can recover these funds and they will be lost forever.

Transaction speed: Transaction speed can also become a problem. Because we know that to verify blocks in chain is very important for distributed network security and it takes a lot of time to do so.

Also Read This – What is Bitcoin Mining and how to do it?

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