What is the Blockchain?
Blockchain Basics: A General Overview
Blockchain emerged back in 2008, with the earliest introduction of the technology showing during the early 90s. Since then, it has been a hot topic for discussion amongst the crypto and tech communities. Understanding blockchain technology is important for those who are involved in NFT and other digital asset transactions that happen inside web3. The reason is: the more that you know about how this tech works, the more it can open your eyes to the possibilities of utilizing it. But the plethora of terms that are thrown around when people refer to “the blockchain” can definitely be confusing. We’re here to help break down the blockchain and help diminish some of the confusion and misinformation about this tech.
The Information Superhighway
An easy, simple way to think about the blockchain as it pertains to cryptocurrency, is the blockchain is the highway and crypto are the cars that travel that highway. And while the crypto winter is still in full force at the time of writing this article, the tech behind blockchain lends optimism for the future. Arguably, blockchain technology is one of the biggest advancements in computer tech since the launch of the internet. So, without further ado, let’s jump right in and get some clarity about this tech that is revolutionizing the industry.
The Building Blocks of the Chain
The blockchain itself is composed of digital blocks that contain certain information. Using Bitcoin as an example, inside each block of info, exists a specific series of transactions that take place within a designated time period. All of these blocks grouped together Bitcoin’s entire chain and witness all the transactions that occurred since its creation. The blockchain is a network of computers that exist in different locations across the world.
The Primary Forms of Blockchain
There are two primary forms of blockchain: public and private. More than 10,000 blockchains currently exist. A public blockchain is typically an open-source software that is used by different people choosing to opt into the network. Anyone with public access to the blockchain can join. Many cryptocurrencies are built on existing public blockchains. ETH is a good example of one of the most well-known currencies written on a public blockchain. Private blockchains are typically built as proprietary software and are hosted on private servers. Some major corporations like Walmart are developing their own blockchain technology to make supply chain logistics easier to track.
Benefits of Blockchain Technology
Some specific benefits of blockchain technology include:
- Decentralization makes the blockchain impervious to power outages and political conflict.
- Promotes the truthful, democratic transfer of data amongst individuals and companies
- Can reduce or eliminate altogether the need for pass-through intermediaries
- Provides better transparency to banking around the world
- Better online storage and security
- Can improve voting transparency
- Reduces the formation of harmful global monopolies
While the technological ramifications of blockchain technology are significantly ironclad, they also carry with them a certain degree of controversy. The tech threatens how modern capitalism works and levels the playing field; giving access to resources and utilities to those who previously would be left out. Blockchain tech is very much still an evolving technology, but it invites the benefit of encryption and decentralization, and several companies are exploring how to utilize it. All this points to the conclusion that the adoption of blockchain tech seems imminent. At some point, it might even be as commonly used as the internet itself.
