An Ultimate Beginner’s Guide to BlockChain
But as cryptocurrencies like Bitcoin gain footing in the international markets (a large share of which exists online), an unlikely problem plays truant. This is the concern about finding a way to make a record of your transactions so they can be used as proof of purchase, or an account of spending, apart from serving other uses too diverse to list completely. The solution has come, interestingly, from a concept that borrows from Cloud Computing as well.The internet has brought the globe together into one giant mart. Be it a TV or a trampoline, everything is easy to purchase, as are services, online real estate and more. The advent of cryptocurrencies has further helped things. You can now buy a product or a service from anywhere in the world. No restrictions of geography or nationality need apply.
This unlikely solution is being called the blockchain. It is a virtual bank passbook, in that all your monetary exchanges are recorded in a convenient and unalterable system, easy to access and retrieve data from. Like many Bitcoin users prefer it to be, the system is also potentially anonymous, keeping a record of your transactions using only the markers and identification you allow it access to or feed yourself, never recording your real details if that is how you choose things to be.
The way this works is simple; when you buy something using Bitcoin, a transaction record is generated. This record along with its entire set of details can be said to constitute a block (it’s more like an internet page) because it cannot be altered and remains in a read-only format. This data in the form of a block is then stored in multiple folders across multiple devices, which are also part of the system. This generates a chain like structure if you were to follow a block around. This way, even if one system or device is lost, there are always more copies to share your transaction record from.
What’s in it for the members of the system? It is no secret that being part of such a system (given how it is based online) requires electricity to run as well as takes a few nibbles out of CPU space and performance. Blockchains have it figured, however. Every member of the chain is eligible for some reward, which goes to monetarily compensate for the power and resources consumed in the process of engagement with the chain. They might seem measly, but they are usually in proportion with the energy and resources actually consumed by the system, computed elaborately.
Blockchains are not just great for Bitcoins and other cryptocurrency exchanges. As several other vital exchanges of economic or social value find a way to be more and more internet savvy, blockchains could go a long way to ensuring security as well as transparency in the matters. One such matter is market trading. Blockchains can potentially weed out counterfeits and cons from the system. Corporations can use the system to manage inventory. Most interestingly, if applied in conjunction with online methods of voting, democracy could reach new heights, being more trustworthy and reliable, and free from ballot stuffing and fake counts forever.
Stacy Miller has been blogging ever since she was in high school. Her love for technology and disdain for generic Hollywood movies has only grown over the years. You can find more of her writing on techiespad.com