What is Blockchain Technology?
Quite simply put, blockchain technology is a new way to store and distribute information.
Before Blockchain — Servers and The Cloud
Most of what you do on the internet today as far as surfing your favourite sites, uploading/downloading, instant messaging, emailing, watching videos, etc, is facilitated via servers. The easiest way to think about a server is that it is a bank of often powerful computers with extremely large hard drives (read: storage capacity). When you access a website, send a file, or receive an instant message — it was likely facilitated via a server.
This is just one example of how you might interact with a server on a daily basis.
Servers are often housed together in a central location. Your company might have its own server bank or it might use servers from another company, such as Amazon.
This is often very expensive to maintain for a number of reasons, here are a few:
- Security — Both physical and digital.
- Energy — Powering and cooling, etc.
- Overhead — Land, building maintenance, etc.
- Servers — Capital equipment.
This current setup also causes security issues in various forms, such as:
- People — People can be hacked/leveraged.
- Technology — Software can also be hacked or otherwise modified/tampered with.
- Force Majeure — Having servers in one location runs the risk of being taken down by floods, fire, earthquakes, etc.
- Government — Data regulation changes, regime changes, etc.
Enter, blockchain technology.
So how does Blockchain Technology work?
Instead of storing information on a centralized server, blockchain technology stores information in distributed nodes. These nodes store all of the transactions on the blockchain, in the form of blocks. Think of blocks as journal entries, and a node as an actual journal. These nodes reside on computers all around the world, and are updated automatically as new blocks are created (ie, as a new bundle of transactions on the blockchain are published via mining). You can have them on your home computer, your office computer, on a server, or any other computer anywhere around the world.
If a person were to try and edit any information stored on a node, it would not matter because there are (hopefully) thousands, if not millions of other identical copies of the nodes/blocks you have on your computer, stored all around the world on other people’s devices. So even if you managed to change a single node, it would not affect the integrity of the blockchain network, as the other nodes/blocks held by others would disprove the changes you made to yours. The corrupted/tampered node would then be eliminated from the blockchain network as a result.
To summarize, information traditionally stored on a server is now encrypted and sent all over the world to millions of other computers to be stored.
Benefits of Blockchain Technology
So why even make the transition from servers to blockchain technology?
- Security — As mentioned earlier, servers and people are subject to a number of malicious or simply unfortunate circumstances. Even if you have multiple server backups in different locations and other failsafes, your costs as a business owner skyrocket. Blockchain eliminates those potential security risks by ensuring the information is distributed.
- Costs — Servers and their associated costs are extremely high. Blockchain eliminates many of these cost drivers, such as: physical & digital security, energy, capital equipment, and server-associated overhead.
Problems with Blockchain Technology
Even with these benefits/improvements, blockchain technology is not perfect.
In order to create the newest block, a user typically has to conduct what is known as “Proof of Work Mining”. PoW Mining is the act of using one’s computer (either CPU or GPU) to conduct very complicated calculations, which the end result is a new block. This is not done very often, let alone by the average person. This leads to the majority of nodes being controlled by only a small group of people.
The problem of over-centralization is a huge concern for blockchain networks. If a single person or group of people controls over 51% of the computing power mining the blockchain, they effectively control the entire blockchain network in question. This is currently the case with many coins.
This is a big challenge for blockchain networks as they essentially require mass adoption of mining in order to be a viable piece of technology.
Which brings us to our second issue with blockchain technology — it is new. Although discussed often, it is rarely understood by the general public. Adoption by the general public is essential to the technology being viable, so an incredible amount of education must take place. Additionally, blockchain projects also need to remove as many barriers to entry as possible for the average person, right now that generally isn’t the case unfortunately.
Gaimin.io solves both of these issues. By reducing almost all barriers to entry into blockchain technology and mining. Gaimin.io software allows anyone with a decent GPU to mine, thus reducing anyone person or group’s capability of controlling 51% of the computing power. By enabling hundreds of millions of people to become miners for blockchain networks, the issue of over-centralization is solved.
For more information on Gaimin.io, please visit our website!
To read our last blog entry, click here.