What Is Blockchain

Intro To Blockchain

Many people think of blockchain as the technology that powers Bitcoin. While this was its original purpose blockchain is capable of so much more. Despite the word's sound, there’s not just one blockchain is shorthand for a whole suite of distributed ledger technologies that can be programmed to record and track anything of value from financial transactions to medical records, or even land titles. You might be thinking, and we already have processes in place to track data what’s so special about blockchain.

Let’s break down why blockchain technology stands to revolutionise the way we interact with each other. Reason number one, the way it tracks and stores data blockchain stores information in stashes called blocks linked together chronologically to form a continuous line metaphorically, a chain of blocks. If you change the data, recorded in a particular block, you don’t rewrite it.

Instead, the change is stored in a new block, showing the x change to y, at a particular date and time. Sound familiar. That’s because blockchain is based on a centuries-old method of the general financial ledger. It’s a non-destructive way to track data changes over time.

Here’s one example. There was a dispute between Ann, and her brother Steve over who owns a piece of land, that’s been in the family for years because blockchain technology uses the ledger method.

There is an entry in the ledger showing that Adam first owned the property in 1900. Adam sold the property today 1930, and a new entry was made in the ledger, and so on.

Every change of ownership of this property is represented by a new entry in the ledger right up until and bought it from their father in 2007, and is the current owner, and we can see that history and the register. Now, here’s where things get interesting.

I want the age-old ledger method. Initially, a book that a database file stored on a single system blockchain was designed to be decentralised and distributed across an extensive computer network.

This decentralising of information reduces data tampering and brings us to the second factor that makes blockchain unique, which creates trust in the data before a block can be added to the chain, a few things have to happen.

First, a cryptographic puzzle must be solved, thus creating the block. The computer that solves the puzzle shares the solution to all of the other computers on the network. This is called proof of work. The system will then verify this proof of work.

And if correct, a block will be added to the chain. Combining these tricky math puzzles and verification by many computers ensures that we can trust every block on the chain, because the network, does the trust-building for us.

We now have the opportunity to interact directly with our data in real-time. And that brings us to the third reason blockchain technology is such a game-changer no more intermediaries. When doing business with one another, we don’t show the other person, our financial or business records.

Instead, we rely on trusted intermediaries, such as banks or lawyers, to view our records and keep that information confidential. These intermediaries build trust between the parties can verify, for example, that, yes, and is the rightful owner of this land.

This approach limits exposure and risk and adds another step to the exchange, which means more time and money spent and land title information was stored in a blockchain. She could cut out the middleman.

Her lawyer who would ordinarily confirm her information with Steve, as we now know all blocks added to the chain, has been verified to be accurate and can’t be tampered with. So and can show Steve her land title information secured on the blockchain. And would save considerable time and money by cutting out the middleman.

This type of trusted peer to peer interaction with our data can revolutionise how we access verify and transact with one another. And because blockchain is a type of technology and not a single network. It can be implemented in many different ways.

Some blockchains can be completely public and open to everyone to view and access. Others can be closed to a select group of authorised users, such as your company, a group of banks, or government agencies.

There are hybrid Public-Private blockchains to which private access can see all the data, while the public can see only selections in others, everyone can see all the data, but only some people have access to add new data.

I’ve government, for example, could use a hybrid system to record the boundaries of Ann’s property, and the fact that she owns it, while keeping her personal information private or it could allow everyone to view property records, but reserve to itself, the exclusive right to update them.

It is a combination of all these factors decentralising the data, building trust in the data and allowing us to interact directly with one another and the data that gives blockchain technology, the potential to underpin many of the ways we interact with one another.

Like the rise of the Internet, this technology will bring complex policy questions around governance international law, security, and economics.