Blockchain Technology: Everything You Want To Know
How To Simply Explain Blockchain?
A blockchain is a network of computers that store database and transaction information under the control of a decentralized system. The note is that it is open-source software with high security on private information and effective 24/7 transactions. Also, the decentralized system saves it from being hacked or cheated. It partly explains why blockchains have gained an upsurge of popularity among many traders and investors.
Who Invented Blockchain?
You might have heard of blockchains in recent years, yet it has a long history before their fame. In 1982, David Chaum proposed the protocol that shared the same model with today’s blockchains. Then, it was developed into a secured chain of blocks by Stuart Haber and W. Scott Stornetta in 1991.
But it took nearly two decades for blockchain technology to officially become what it is today. Satoshi Nakamoto brought it out in 2008 with the combination between a Hashcash-like approach and timestamp blocks. Bitcoin was the first cryptocurrency that was used to apply with blockchain, which made them both rise up in the finance’s hall of fame!
People still don’t know who Satoshi Nakamoto really is as it is a presumed pseudonymous name. It can imply a person or a group of people behind the invention of bitcoin and blockchain.
Is It Secure To Use Blockchain?
With decentralization and irreversibility, blockchain is a reliable method to store and transfer money and wealth. Specifically, there is no one who can take the whole control of blockchains although they can view the codes without identities. It implies the low possibility of manipulation and domination by big users in the markets.
In addition, the timestamp blocks enable the blockchain to set the data and information in a filled block as stone. So, no one can change or edit past transactions. Hacking problems can happen but the impacts it leaves are kept minimal due to the operation of tremendous computer networks all over the world!
Can Blockchain Be Hacked?
Although it is famous for high security, confidentiality, and transparency, blockchain is actually hackable. The fact is that no software is perfect in all aspects. And miners are not the only people who mine for profits and benefits as hackers do the same thing. Since 2017, it has been reported to lose about $2 billion due to hackers. Yet, it is a sign for other innovative solutions to upgrade blockchain technology if we think about the bright sides.
Which Companies Have Applied Blockchain Technology?
Considering all the facts about the advantages and disadvantages, many companies have applied blockchains to their business. And don’t be surprised when there are big corporations getting involved in blockchain, such as IBM, Microsoft, Overstock, Kodak, SBI Holdings, Oracle, etc.
How Different Is It Between A Private Blockchain And A Public Blockchain?
A public blockchain, as the name suggests, refers to a permissionless blockchain so everyone can join the network to establish a node without any fees. For such an open nature, Proof of Work (PoW) is crucial for the enhanced security of cryptography and a consensus system. A private blockchain is the opposite of a public blockchain when it requests approval for the setup of a node.
What Are The Differences Between Blockchains and Banks?
In general, banks and blockchains do the same job — keep other people’s properties and generate profits through time! Yet, each format has its pros and cons. For a short answer to this question, we will walk you through some aspects that relate to the users’ benefits.
- Banks work on weekdays from 9:00 am to 5:00 pm while blockchains are open 24/7.
- Transaction fees when using banks include card payments, checks, wire, etc. while bitcoin blockchain costs range from $0 to $50.
- The transaction speed in blockchain takes about 15 minutes while you have to wait for more than 24 hours to process a transaction.
- Privacy of your information might not be guaranteed in banks as it follows a centralized system of operation while blockchain works in the decentralized model.
Bitcoin vs. Blockchain
Bitcoin is a famous cryptocurrency for its superior features while blockchain technology is a means to store the records of payment ledgers. Instead of trusting the third parties, blockchains allow users to directly store and execute transactions. So, the fees will be profoundly increased and the security will also be enhanced!