What is blockchain technology?
Blockchain is a concept that is being widely discussed in Today’s tech world as to its ability to make a significant impact on the standard business processes we use daily. The reason this has shaken the world to its core is that the blockchain’s ability to be extremely secure and being non regulated.
But this tech jargon is widely mistaken as it is used mostly with crypto currency context only. Its important to realize that Blockchain is a philosophy and Crypto currency such as Bitcoin, Ethereum are applications built based on the concept of Blockchain. But Blockchain concept is valid for any industry domain if applied correctly.
The security aspect of the blockchain comes from the fact that all the important transaction data is contained in blocks that are maintained by everybody as identical copies within the network. This resembles a situation where the banks main ledger book is distributed among all the customers of the bank making it impossible for anybody to corrupt the ledger book in their favor. If someone wants to change it, they have to change the ledgers books maintained by all the bank customers. In an actual blockchain network there will be millions of ledger books maintained throughout the network making it nearly impossible to contaminate data.
The peer to Peer network based data distribution eliminates number of risks compared to the traditional central storing of data. Every peer that will be represented as a Node is expected to maintain a copy of the block chain. This redundancy of the data is the key strength of Blockchain concept.
The distributed aspect of the Blockchain creates possibility to eliminate the central governing bodies such as Banks, Governments and lawyers. This is one reason why crypto currency is so much popular as it allows people to use unregulated money, hence black money could be kept without any obstacles within certain Crypto currency platforms.
The smart contract aspect of the Blockchain appeals mostly to cooperate businesses. The transparency of data will help the business world immensely where multiple parties are contributing to the same workflow.
Yet the overhead of maintaining multiple Blockchains in each node has struck as a high energy consuming process when the whole network is considered. Hence it’s important to note that even though there is a hype around the term Blockchain it’s not for every business owner as if not properly used this is could be an over engineered solution for a simple problem.
- Praveen Nayanananda
Photo credits : Internet