Blockchain and Its Implementation in Cryptocurrency
A blockchain is a chain of blocks that contain information. It is intended to be used as a timestamp in digital documents so, the people can backdate or change the document at that point. A blockchain is the best way to track data, because of the way it tracks and record data the blocks are in a chronological formation to make a continuous line. If you make a change in a block. It will not rewrite instead, it will create a new block with the information about the changes made and the timestamp of the event. It is based on the general financial ledger. It is a non-destructive way to track data over a period of time.
A blockchain is decentralized and is distributed across a large network of computers due to this decentralization of information the chances of data tampering is reduced dramatically. Second major factor where the blockchain is the best way to track data is trust in the data before a block can be added. There are few factors or things which are supposed to be in place, first a cryptographic puzzle must be solved thus creating a block. The computer that solves the puzzle shares the solution with all the computers in the network. This process is called proof of work. Thirdly network verifies the proof. If the solution is correct the block will be added into the chain, with all this complicate maths and verification by several computers, we can create blocks in the chain. Lastly blockchain’s biggest benefit; no more intermediaries. While making a trade for something, we don’t like to show our financial status and that’s why use intermediaries such as banks or lawyers to keep our records and status confidential. These intermediaries build trust and can verify the solution and give out a final result even though this process is good. It has a little risk of exposure and it takes a lot of time and money but, the use of blockchains can remove the intermediaries as all the data is verified, safe and recorded in the blockchains.
There are three types of ledger and blockchain is a distributed ledger. A distributed ledger is a database held and updated by an individual entity. The distribution is unique and is not centralized, they are independently constructed and held by every node, every single node, process every transaction, coming to its own conclusion and the majority one is chosen.
The blockchain biggest use in the modern world is on Bitcoin. The blockchain’s boxes store 3 data: to, from and amount. The data is verified by the network. If the data is changed after the chain is made it will show an error as the hash and the data are interconnected so if one thing changes the other does too. The only reason it shows an error is because the previous hash is changed. The value doesn’t match which leads to an error. The bitcoin is a high-end cryptocurrency whose current value is $7523.98. It uses blockchain method to do all the transaction, deposition and other works. It uses blockchain because of its numerous advantages. The blockchain neglects the need for the intermediaries while doing a transaction or deposition. It saves time and it is also more reasonable then hiring an intermediary.