(This article was published under Paytm cash reward campaign held between February 3-11, 2018. Author “Abdullah Khan”, Email: ”email@example.com” has been rewarded INR 300 as Paytm cash for the same.)
Even before cavemen ignited the fire, they built a business model. Yes! That’s right! In the times when the human race was crawling like an infant, it invented a system where they can exchange goods for their requirements. Of course!
The model was simple and ineffective yet it did justice to the needs of that time. As the human race got matured, its business models also got complicated. Now that the human race is advanced and everything is getting digitized, Digital currencies are now becoming a mainstream business model.
Cryptocurrencies like Bitcoin, Ethereum have been the hottest buzz in the world lately. Millions of transactions and total trade of billions, if not trillions of dollars have been established under cryptocurrencies. There is a reason why cryptocurrencies are being called “Digital Gold”. Ever wonder how does it all work?
The entire empire of cryptocurrencies is based on a system typically known as Blockchain. If you use the internet you must have seen this word quite often.
Blockchain is a database built by a person/group who call themselves Satoshi Nakamoto. It allows digital information to be distributed but not copied. It is in itself a new kind of internet.
Though it is devised for digital currencies, there are many other ways where this technology can be used. Amazingly, you don’t have to know how the Blockchain works to use it, yet it is better to understand this revolutionary technology.
Don & Alex, authors of Blockchain Revolution (2016), describe a Blockchain as an incorruptible ledger of economic transactions that can be programmed to record not a just financial transaction but virtually everything of value. Confused, eh?
Let’s make it easy – you must have seen an excel sheet, right? So, imagine that we have duplicated it thousands of time and broadcasted it in a network of computers. This network is designed to regularly update this sheet. This is Blockchain – in the simplest way.
Information stored in a Blockchain is shared and regularly reconciled – means a database. This database is not stored in any single location – anyone on the internet can read it. Since information is not centralized therefore it is impossible for a hacker to corrupt it. Why is it called distributed though?
Let’s assume I have to send some information to someone and get it reviewed. I will make a doc file and send it to the person. Now the problem is that I need to wait until the other person sends me back the updated copy to make further changes. That’s how databases work today.
Two owners can not mess with the same data at once. However, If I have something (read – Google Docs) which allows access to both the parties to read and make changes. It becomes a shared ledger. If something is shared among a number of people at the same time – it becomes distributed.
The blockchain is just like internet holding loads of information that are identical across its network. No single entity can control it – This makes Marx happy! (a little communism joke right there!) and it does not have a single point of failure. Blockchain network is transparent and incorruptible.
It is a self-auditing system for a digital value – a network which reconciles every transaction that happens in a ten-minute interval. Each group of these transactions is called a ‘block’ because it is all about managing this series of blocks, hence the name ‘Blockchain’. Awesome, right?
The invention of blockchain is as big as the internet itself. It is not limited only to cryptocurrencies. It is the future of business and shares trading in the global market. Its secure private-public key model gives the user his/her own digital identity while by providing the self-auditing ledger it literally removes any kind of middleman in the trade.
It can also be exhaustively used for government operations, distributed app systems and creating a global network of the self-auditing business environment.
With all these features Blockchain is indeed revolutionizing the world. In the times when user data is at risk on the internet – Blockchain incorruptible policies is a hope that at least the digital economy is not a dream anymore!
Blockchain – a miracle of technology!