An Introduction to Blockchain

An Introduction to Blockchain
An Introduction to Blockchain

Due to the growth of using Blockchain technology and the huge volume of its related news, it will be very perplexing when it comes to carefully defining this technology. However, these new concepts and functional tools can be learned in a simple language. To better understand Blockchain, we compare it with a bank. Through making a comparison between the performance of the bank and Blockchain, we can achieve a more appropriate and deeper view.

Blockchain Performance

The bank you have an account in is a central database. In this central database, exact information of all the customers has been registered. The customers’ information includes the phone number, financial balance sheets, transactions, and financial accounts. Every transaction the customer does in his account (e.g., withdrawing money or transferring to another account) will be registered in his/her bank records. 
It is just the bank which has access to the customer’s information and can alter them. Now, imagine that a hacker gets access to the database of the bank. He/she can intentionally manipulate the information and change them. In this case, the bank will be able to retrieve it having access to support the version of the customers’ information and data. However, Blockchain is a very smart database. Instead of a person or an institute (bank), a large number of people have access to a version of information and data registered in the network. Each user owns a copy of data from the start of network activity to the time being.

Transactions in Blockchain System

Each user in the Blockchain network is called a “node,” and many nodes confirm each transaction in this network. After each trade or transaction, all nodes will update their information. As a result, the network will always remain updated. New transactions will link to the set of previous existing transactions in the network infrastructure and form a new block. These blocks have many advantages.  No person or organization oversees the blocks; in other words, there is no central overseer for the activities of the Blockchain network. If a hacker or a fraudulent user intends to infringe on the information or wants to alter the data, all the other nodes will negate this alteration. Consequently, the alterations the hacker makes will not be confirmed by the other users. All these show that Blockchain is a safe network and has a transparent structure. 

Blockchain Benefits

Blockchain network helps removing middlemen in financial trades. With the help of that, you can do different financial transactions. For these transactions, there will be no need for foreign bill institutes or banks. It is worth mentioning that the market which offers financial services is one of the most profitable markets in the world of investment; however, the presence of Blockchain which is a decentralized infrastructure without any middleman to do transactions and make communications among people will greatly help decrease the financial charges in different transactions.
Blockchain can be used for other purposes too. For instance, for voting and polling, this system can be employed. With the help of Blockchain, there will not be the possibility of cheating in the votes results, and there will not be any censorship and cheating. Blockchain smart network is a suitable infrastructure for different trades via various cryptocurrencies or digital currencies. These digital currencies remove communicative bars between people in different parts of the world. For example, the countries which are under sanction or in a hard situation because of the downfall of their currency value can employ digital currencies and Blockchain as a result.

Blockchain in Different Parts of the World

Blockchain network is in its evolutionary route, and there is a long way ahead of it. Many countries around the world are not optimistic about its use in different applications. This issue shows that this new technology needs time to prove itself. The support on the part of international foundations such as the World Bank can play an important role in this network being accepted by different countries and governments.

Written by:

Dr. Pooyan Ghamari

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