Why everyone is obsessed with blockchain technology?

In my previous article, I have used the term blockchain, but I don’t explain it further. Like bitcoin, blockchain technology also contains more details. So I decided to write a separate article for this one. Before entered to the topic please read the bitcoin article.

OK, starts our questions, First question, what is blockchain?

In simple terms, blockchain is mostly like a ledger. We have kept all our financial transactions in a ledger, in the same manner, the bitcoin transactional records are stored in blockchain. The working process of the ledger and the blockchain is also the same because once you entered the record, it is extremely difficult to make changes. So, blockchain is also known as a digital ledger.

Now the definition is over, moves on to the next question, How is it works?

I already told you that blockchain is a digital ledger that stores the transaction records of bitcoin. Here each record is called a block and each block is interconnected. That’s why it is called a blockchain.

Each time a transaction occurs, a record of that transaction is not only stored in the sender and receiver side but also added to every participant in that ledger. This means the records are managed in a decentralized manner, so the major advantage of this one is if the failure of one node can’t affect the other. Another advantage is the transactions are stored in a public list, so the same as bitcoin make a fake one is impossible. This decentralized ledger is known as Distributed Ledger Technology (DLT).

Move on to the next question, How this block is created? In my previous article, I have coined one term mining, using this one the blocks are created. In mining the participants are called miners, they create a new block on the claim through a process mining. But creating a block is not an easy process. To explain the process of mining, there are many technical terms that are needed. But I try my best to explain it in simple terms.

The miner uses special software (like our apps) to solve the complex math problem of finding a nonce (32-bit whole number, generated when a block is created), that generates an acceptable hash (256-bit the number attached to nonce). But why we need to do these complex things? The answer is to make the system more secure. For example, if you want to attach a new record(fake one) on a block, then you have to check more than four million combinations of nonce and hashes to find the right one. Now you all understand why we need to this. In case you’re successful with the above process, then that nonce is called ‘Golden nonce’.

Now all of you know that blockchain is a secured one, because of its decentralized environment and its transparency. Other than these advantages it has some cons also. The first is its size, but how? We already know the size of the bitcoin network and how fast it is growing this causes continuous growth in blockchain technology also. But how this one affects security? If the size grows, which means the transaction count is increased. So every nanosecond a new block is added to the chain. Due to its decentralized manner, each of these blocks is updated not only that particular user but also all the participants of the chain. Every block contains its own hash and the previous block hash. If you want to change any content, it not only changes your block hash but also the chain of block is attached to that blocks are also make changes in it. According to this, size is the major problem.

The above situation creates another issue called inconsistency. The process of update is the difficult one in blockchain, but it is possible. In case of updating task is not properly performed it leads to inconsistency. Consider the situation, if you are lived in city A after some time you’re transferred to city B. But some of your certificates contain your old address, what should you do? You have to update the details. Now the details are updated except for the insurance office, but you were unaware of it. They send you the pending amount details on your old address. But you don’t know that. What happens after the due date? Your policy will be dismissed. This situation is known as inconsistency. Now all the pros are changed as cons. 

So think before you do it.

I think all of you should know that what is blockchain technology and why everyone is obsessed with it?

“Practice makes perfect”. If you want to master something, make sure to find a course or a project that will let you get your hands out of the dirty.

If you think the content given here is valuable, then share it with your friends and colleagues.

At the same, if you found any corrections, share them with me through the comments section.

Once again thank you for reading!!!