Blockchain Technology: Why Does It Stand Out?

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All you need to know about the endless possibilities in blockchain technology.

Blockchain Technology

What is Blockchain?

A blockchain is broadly a digital ledger of decentralized data that is securely shared. With blockchain, transactional data from multiple sources can be easily collected, integrated, and shared. Bitcoin, a popular blockchain is used in a decentralized way so that all users collectively retain control. Being decentralized means that the data entered are permanently recorded and can be viewed by anyone.

Think of blockchain as a chain or record stored in the form of blocks that are controlled by no single authority. Trust, transparency, accountability, and security are forged into this chain. Each transaction is secured with a digital signature that proves its authenticity. This enables many types of organizations and trading partners to access and share data, a phenomenon known as a third-party, Consensus-based trust.

Why Does Blockchain Technology Stand Out?

Here are key features that make blockchain technology attract so much attention:

· Decentralized- Blockchains are decentralized in nature. This means that it is controlled by no single person or group. While everybody in the network has a copy of the distributed ledger with them, no one can modify it on his or her own. This unique feature of blockchain allows transparency and security in the network.

· Immutability- The immutability property of blockchain is the fact that any data once written on the blockchain cannot be changed. Once the data for a block has been processed any attempt to alter or change it will prove rather impossible. If you try to change the data of one block, you’ll have to change the entire blockchain following it as each block stores that hash of its preceding block. Hence the data stored in a blockchain is non-susceptible to alterations or hacker attacks due to immutability.

· Peer-Peer Network- With the use of blockchain, the interactions between two parties through a peer-to-peer model is easily accomplished without the requirement of any third party. Blockchain uses P2P protocol which allows all the network participants to hold an identical copy of transactions, enabling approval through a machine consensus. So if you wish to make any transaction from one part of the world to another, you can do that with blockchain technology all by yourself within a few seconds.

Blockchain Technol;ogy

How is Blockchain Used?

Cryptocurrency

The most common use of blockchain today is as the backbone of cryptocurrencies, like Bitcoin and Ethereum. When people buy, exchange, or spend cryptocurrency, the transactions are recorded on a blockchain. The more people use cryptocurrency, the more widespread blockchain will become.

Asset Transfer

Blockchain can be used to record and transfer the ownership of different assets. This is presently very popular with digital assets like NFTs, a representation of ownership of art and videos. Blockchain could also be used to process the ownership of real-life assets, like deeds to real estate and vehicles. Using this process, you can transfer property deeds without manually submitting paperwork to update the local county’s government records. It will be instantly updated in the blockchain.

Smart Contracts

Smart contracts are automated digital contracts that are enacted once conditions are met. Smart contracts have proven to be a very useful blockchain innovation. They are commonly called self-executing contracts- using blockchain technology and coded instructions to automate legal contracts. When properly coded on a distributed ledger can minimize, or preferably eliminate the need for outside third parties to verify performance

Blockchain is no longer an emerging technology. This can be seen by the increasing adoption of blockchain technology by top countries and organizations all over the world today. Blockchain could be quite complementary in a possibility space for the future world which includes centralized and decentralized models. Thus, Overtime, blockchain could exist in a larger ecosystem with these models.