The blockchain may seem complicated from the outside, but once you get into utilizing the technology, it can actually be very simple and easy to use. Over time, it’s easy for a blockchain to become as familiar as Wikipedia, for instance. A blockchain is essentially a public record of information, in which multiple people can make entries that detail transactions that have been conducted by sending or receiving digital tokens or coins. This creates a community of users who have control over how that information is recorded, updated, and amended. Just like Wikipedia, where entries aren’t published or controlled by a single person, no blockchain is published or controlled by a single person.
For the first time in history, one internet user has the ability to transfer digital property and finances to another user in a secure and safe manner on this website. The transactions that occur are open, meaning that they can be viewed and verified by anybody, so there is no central control or company that oversees all of the transactions. This creates a very secure method of transferring finances, and it’s tough to overstate how much the development of blockchain has made an influence.
What’s the Difference Between Blockchain and Other Technologies?
Blockchain technology is very unique. While the blockchain and something such as Wikipedia run on networks that are distributed (ie: the internet), Wikipedia was built on the World Wide Web (WWW) through a client-server network model. A client (user) is able to alter Wikipedia entries if they have permission, and all entries are stored on a server that is centralized.
Whenever you access a Wikipedia page, you see the most updated version of what is essentially the “master copy” of the page. Wikipedia administrators maintain control of Wikipedia’s database as a central authority that allows permissions and access. This method and digital backbone is similar to databases which insurance companies, governments, and banks use today and which are very centralized and protected.
With blockchain technology, the way its data is distributed is different and the digital backbone is completely different–which is the most important and distinct feature to blockchain. In the case of the blockchain, the record is updated independently, and the record that’s most popular becomes the official record in a de-facto manner, as there is not a “master copy.” Each node creates updated, individual versions of events, and the transactions are transparent throughout the network. This eliminates a centralized party and is innovative for the distribution and registration of information.
How the Blockchain Defines Digital Trust
On the internet and in the digital world in general, the ability to determine trust often comes down to two things: authentication, or, proving identity, and authorization or proving permissions. People want to know if you are who you say you are, and if you have permission to do what you’re trying to do. With blockchain technology, authentication requirements are fulfilled through private key cryptography, and a peer-to-peer, distributed network creates the authorization. The entire network applies the blockchain’s protocol to authorize transactions.
Blockchain technology is revolutionary–and once you know the basics, it’s easy to understand and simple to navigate.
