Blockchain is a data recording system like a database that makes a secure system. A blockchain is distributed database and digital ledger of transactions. As a distributed database, it is a distributed network of computer systems that stores data digitally on the blockchain. In cryptocurrency systems (such as Bitcoin), blockchains are popular for keeping secure decentralized data of transactions. Blockchain guarantees the security and trustworthy data transactions without the involvement of a third group. Blockchain is a chain of blocks or several transactions that occur in each block of the chain, whenever the new transaction occurs data of that transaction is added to each member of the ledger. Decentralized databases managed by multiple members are known as Distributed Ledger Technology (DLT).
Distributed Ledger Technology (DLT) Properties:
Programmable: Blockchain can be programmed.
Secure: All records are end-to-end encrypted.
Immutable: Blockchain records are immutable/irreversible means data cannot be changed.
Time-stamped: Data record on each block with time and date (checksum).
United: All members of the blockchain network accepts the validity of records.
Distributed: Blockchain networks have a duplicate ledger for clarity.
How Does Blockchain works?
Blockchain’s goal is to record the data and distribute it but is not allowed to modify it. Blockchain is a distributed ledger in which transactions records are immutable that cannot be changed or destroyed. Due to these properties blockchain is also called Distributed Ledger Technology (DLT).
According to the research in 1991 the concept of blockchain application is only used by Bitcoin in 2009. After years ago blockchain is used by different cryptocurrencies like Decentralized Finance(DeFi), non-fungible tokens(NFTs) and Smart Contracts.
Blockchain Transactional process:
As blockchain is a chain of blocks in which new transaction occurs.
Then the transaction is transferred to a peer-to-peer network.
The peer-to-peer network checks the clarity of transactions.
After the confirmation, the process of the transaction is complete and they are combined in a set of blocks.
Uses of blockchain:
In blockchain financial transactions are stored. And now more than 10,000 other cryptosystems transactions are stored on the blockchain. Because for storing data blockchain method is more trustworthy than other transactions.
Blockchain is used in banking:
Blockchain benefits the most in banking. All the finance organization working days are Monday to Friday and if you want to make transactions on Saturday you have to wait for Monday morning. Even if you make business transactions you need to wait for 3-4 hours. Due to this problem, business deposits are important and the blockchain method is all time available you can deposit any time.
Using blockchain in banking transactions processed within minutes and this time consumed only in adding blocks. And in holidays you can easily send and receive funds quickly and securely.
- Blockchain is more accurate and verified by eliminating manual work and human involvement.
- Costs are reduced by eliminating third-party interference and verification.
- Blockchain used transaction transparency technology.
- The blockchain method is secure, trustworthy, reliable, private and accurate.
- Technology significance costs linked with bitcoin mining.
- Blockchain is used in prohibited activities e.g. dark web.
- There is a limitation on data storage.
- The transactions rate is low per second.
Many applications and technologies are analyzed and due to Bitcoin and cryptocurrency, the blockchain is finally known by its name in a very short time. In investor’s language, the blockchain method makes business and country operations more accurate, secure private and efficient.
It’s the third decade of blockchain, and now the question is whether legacy companies will accept the blockchain but the question is when it will happen. Nowadays, NFTs and assets of tokenization are increasing. The coming decade is a turning point for the development and growth of blockchain.