These days we have all come across one of the coolest buzzwords in the IT industry: "The Blockchain". It might seem to be a new magic word in the market that companies spell interest in their businesses. However, the complexity of it is incredibly far-reaching. Blockchain integrates the openness and flexibility of the internet with the security of cryptography to come out with a safer, faster way of verification of information and most importantly establishes trust in this open world.
Blockchain was first developed by an anonymous programmer or group of programmers known by a name 'Santoshi Nakamoto'.It was an underlying technology for the Bitcoin, which is used for peer-to-peer transactions. Blockchain at its heart is a list of transactions like a distributed ledger open to all in the network. It stores the data in such a way that it seems virtually impossible to add, update or remove any information stored without the notice of other users in a peer-to-peer network.
How does blockchain work?
Blockchain mainly performs two tasks: collect and order data in blocks- similar to the traditional computer database and then chain them securely using cryptography.
Let us take a closer look at each block in this enormous chain –
- FILLING IN THE BLOCK Data: This is the information which depends on the blockchain if it is a bitcoin block, then it contains information about the sender, receiver of the amount and the amount value.
- SECURING THE CHAIN Hash: It is quite similar to human fingerprint and is unique to each block, once the information of the block changes, the hash changes and the block no longer remain the same as the previous one.
- LOCKING THE BLOCKS DOWN Hash of the previous block-the hash of one block gives the data for the next block, and this new block uses this hash function and traces of it is woven into the new hash this continues to build an enormous chain.
Establishing the trust
The copy of the complete blockchain is with all the participants so that they can detect tampering if the hash matches across the chain then everyone knows that it is trustworthy. Blockchain is an emerging technology but has been evolving ever since its innovation. This technology has the unlimited potential to bring about an upheaval in the way everyone- organisations, governments, individuals work together. It promises a simple, secure, paperless path to establish trust for virtual transactions of money, products and other confidential information worldwide.
Blockchain in action
Blockchain is one of the technologies that has gained popularity from its very birth, and now it is being used in many fields.
In financial markets, trade is very dynamic where there is the exchange of money, assets involving multiple banks; this may lead to unexpected errors. To reduce this bottleneck blockchain came up with the idea of smart contracts which is a small computer program that describes the transactions step by step combining multiple blockchains, multiple assets and executes the transactions securely.
Blockchain can keep track of many commercial transactions and efficiently hold sensitive information. A digital id via blockchain secures the data stored and can be used worldwide in your fingertips.
Blockchain can be very handy in monitoring the supply chain in food and manufacturing industries by removing paper-based trails and also removing intermediaries between producers to customers. Not just the above applications it is used in many more places and has changed, is going to change the world around us.
Blockchain the next-gen technology
Though it is a new technology, it has an enormous ability to transform everything existing now. As a coin has its two faces, blockchain technology also has some glitches as it can destroy the middlemen in many of the industries. Blockchain has already spread its root firmly in soils of the new world, and the swarm of transformation has already begun. It is the responsibility of all the young generation to make complete usage of this technology as it matures and make it to become a huge money plant.