All of the major technologies in the past have filled the biggest voids in the society which was most needed at that time. Whether it’s filling of knowledge void with the printing press or power void with engines or distance void with the internet and now it may come to the filling of trust void with Blockchain!
Blockchain as a technology was firstly described in 1991 and its major application took place in 2009 with the introduction of Bitcoin.
Before moving forward let’s see what basically blockchain means in the most basic terms:
What is Blockchain?
In the most general term
“Blockchain is an immutable, distributed ledger”
Now let’s break it down to understand it better:
What is Ledger?
Ledger is any book or digital file which stores transactional details like credits, debits, asset ownership data or some arbitrary message.
What about distributed?
Each individual ledger is distributed across all network and on each modification, in the ledger, it got replicated across all nodes.
Also, the peer in the network can also act maliciously which is easily handled with Blockchain.
Why distributed?
Distributed ledger makes the blockchain decentralized and trustless(as no trust is required between participants while making a transaction).
Why immutable?
Immutable means here that once data is committed to ledger it can’t be changed. Also, the network must come to a consensus to update the ledger.
What does it mean to be on consensus?
Coming on consensus means everyone on the network agrees on the same state which could be money in the account or anything else.
How do we reach consensus?
There are several algorithms that are used to reach consensus like Proof of Work, Proof of state, PBFT(practical byzantine fault tolerance).
All these algorithms try to achieve a common agreement on the present state among all the peers on the blockchain network.
So, basically blockchain is an online distribution system to store information in the most trustable form.
What are the types of Blockchain?
Blockchains can be classified based on the read and write permissions on the network.
Why we need blockchain?
There are multiple reasons one can think of using blockchain technology:
Firstly, why to pay to third parties a huge amount of extra fee just for doing our transaction, which we can do more securely and efficiently in real-time which can take a long time in the normal way.
How to trust on the medicine expiry date or the fruits and vegetables that I’m purchasing are organic?
How to trust that taxes which I’m paying to our government is used on me?
These all trust issues and several middlemen commissions can easily be erased with the amazing technology of blockchain.
Future with blockchain
There are several areas where blockchain can impact a lot in the near future.
Like in real estate currently we need to contact government offices, brokers and landlords for the authentication of ownership. With the blockchain, every detail of all the previous owners with no paperwork can be easily authenticated.
Also even in getting or donating blood or booking a cab, there won’t be any third party involved. Even it can help artists to get directly paid from their fans without any third party involved.
Finally, blockchain can also increase transparency within our governing system which will also make us aware of how governments are using our taxes!
So, basically blockchain can impact the world in many ways and can help in building trustful society.
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