Blockchain is a new trend that you may have heard about. This is a new concept that many people are not familiar with, but it is possible to learn more about it. This is because the idea is not that new. It’s actually been around for years. What is it all about?
The main goal of Blockchain technology is to implement distributed ledger technologies (DLT). What does this imply? It simply means the latest financial transaction recording technology that uses peer–to-peer technology to allow real-time transactions. The concept actually originated from the Internet but it has now spread into other areas including finance, software development, electronic money transfer and real estate.
Vitalik Buterin (one of the founders) of the Blockchain project explained that it is basically a new digital leadger that functions as the original internet but is less vulnerable than the webbed Internet. The distributed ledger stores transactions. This ensures everyone involved in the transaction has their updates at all time and that they are not altered by anyone. The distributed ledger makes transactions secure and can’t ever be reversed.
Smart contracts are a type or virtual machine that can be programmed to perform certain tasks. For instance, theICO platform allows its users to create smart contracts that perform the function of collateral exchange, settlement management and other such transactions. Hence the Blockchains use a sort of a virtual machine or computer program to facilitate the transfer of currencies and other monetary values. The concept isn’t limited to currencies. Blockchain technology is also used to transfer and store financial instruments like stocks, bonds, or commodities.
An individual or organization’s personal information and data cannot be accessed without their consent. This is the essence of privacy and an essential feature in Blockchain technology. Transactions on the Blockchain are encrypted and the identity of the transactional user is masked. Hence the transactions run virtually risk free and are safe from any unauthorized access.
Blockchain transactions are independent from public ledgers. The Blockchain is completely secure and does not allow for unintended transactions. The public ledgers however are vulnerable to hackers, and it is possible for someone to tap your financial data. Blockchain transactions are transparent and managed by a network that is susceptible to malware attacks. Hence the chances of hacking and phishing are very much reduced and if your digital ledger is hosted by a renowned institution, then you can be rest assured that your data is absolutely safe and secure.
As people are more aware of the potential benefits of Blockchain technology, their popularity has risen dramatically. Many financial institutions have begun to use the technology for internal applications. Financial institutions such as banks and hedge funds, asset managers, and other financial institutions are using Blockchain technology internally and successfully integrating this technology into their systems. Some well-known corporations like PayPal, MasterCard and Visa have already adopted the Cryptocurrency concept to their internal use. As more people become aware of the benefits of Blockchain technology and the necessity for it, it is evident that Blockchain use is growing.
Experts from the fields of Computer Science and Math are slowly adopting the concept. Many renowned universities are investigating the implications of public blockchain technology to their academic purposes. Developers are creating prototypes for the next generation cryptocurrencies, like the Maidsafe (and Counterpart) due to growing demand. The future is bright, as more people get involved with the concept and the competition grows stronger among different cryptospace participants.
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