RELEVANCE OF BLOCK CHAIN TECHNOLOGY
Few days back we started a series on block chain, for those that missed the first, you can click here to know about the history behind block chain.
Block chain technology is changing industries around the world. It’s bringing organizations, governments, financial institutions, and payment platforms into a new digital age. It’s revolutionizing everything around us – and yet many people have no idea what block chain is or how block chain technology works.
Today, I'm going to be explaining the core things you need to know about block chain and block chain technology.
Going through this post will make you marvel at d wonders of block chain ...bitcoin and other crypto currency are just like 5% of what you can use block chain technology to do...imagine someone saying everything about internet is just Email...that's just a great misconception same apply to block chain if we say blockchain is all about bitcoin.
Block chain is an open, distributed ledger that can efficiently record transactions between two parties in a verifiable, permanent way.
Block chain is the technology at the heart of bitcoin and other crypto currencies. Without block chain, crypto currencies would not exist in their modern form.
Now to further simplify the explanation of block chain; try to imagine a big accountt book in which business transaction are recorded..now this book is imaginary and well secured so that no one can alter its content or falsify it.
IMPORTANCE OF BLOCK CHAIN TECHNOLOGY
Contracts, transactions, and the records of them have long played a crucial role in our modern world. Our legal and political systems rely on contracts and transactions for virtually every core function.
Contracts, transactions, and records are used to protect assets or set organizational boundaries. They’re used to verify identities or chronicle events.
Every day, the world around us is governed by contracts and transactions. However, the way in which we record these contracts and transactions is stuck in the past. These critical tools have not kept up with the digital revolution..and that led to the creation of special technology called block chain technology to properly handle such contracts in this digital age and that’s why so many companies are seeking to implement block chain technology into various industries – the potential benefits are enormous.
Do you know that blockchain could eliminate the need for lawyers, brokers and bankers ?
Think of the importance of blockchain like this: much of the world’s infrastructure consists of intermediaries – or middlemen or our so called 'agents'
We’re not just talking about middlemen like businesses that take a cut of profit for selling goods or services.
We’re talking about lawyers who act as an intermediary between the public and the law, or bankers who act as an intermediary between individuals and their access to creditors. There’s a possibility that lawyers, brokers, and bankers could be made obsolete by blockchain technology in the future.
Instead of requiring intermediaries, blockchain technology would allow individuals, organizations, machines, and algorithms to interact freely with one another.
We’re already seeing this with blockchain and bitcoin. When two individuals want to exchange bitcoin or other cryptocurrencies, they don’t go to a bank and pay a hefty transaction fee. They complete a peer-to-peer transaction over the blockchain.
How Does Blockchain Work?
The blockchain is a distributed ledger that embeds contracts and transactions in digital code.
This digital code – and the record of these transactions – is stored in a transparent, shared database. This database is decentralized, which means it’s held by people (“nodes”) all over the world. This decentralized system protects the blockchain from tampering, deletion, and revision.
Using the blockchain, everything we do has a digital record. That means every process, transaction, task, and payment has a digital record. Each record can also be traced back to an individual: it has a signature that can be identified, validated, stored, and shared.
Ultimately, this allows organizations or individuals to conduct business in a more efficient way: with blockchain, we have a tamper-proof, verifiable, and permanent way to record transactions between two parties.
Let me give you a practical example; Imagine you promise to pay me £50 if I complete a task, and I also promise to deliver d task in a week time...we put this contract ( agreements) in to writing (but in the case of blockchain; its a digital writing of codes) and we make copies of it and share it with our friends or witnesses and so keep copies in institutional safe like banks (sharing the copies like this makes it decentralized meaning no one has the sole power over it again) using a combination of passwords from you and me ( known as private keys in blockchain) so each day I complete a task, I update the ledger/records till the end of the agreed period, at the end of the agreed period you will pay me and our witness holding the copies of our contract will confirm the task to have been done and transaction completed..those witness are like nodes in blockchain. so you see that in this case, you and I can't falsify our agreement again as we are no longer the sole owner of the ledger, it has been become decentralized.
For now I will take a break, thank you for following up on the series, the next post will definitely interest you more
No comments:
Post a Comment