Blockchains
Blockchain
Appearing as an emerging technology trend on the world’s leading research firm, Gartner, is set to revolutionize the finance sector and many more like an entire Supply Chain or a Product Checking Mechanism. Blockchain, simply put, is a distributed ledger, a ledger on each node and computer all receiving transaction requests and maintaining the ledger. Kind of fits the analogy of “distributed trust” as there are no governing bodies, local authorities or banks involved in the entire process, as it entrusts the entire process to the community members who are better known as nodes on the network.
Blockchain is also specifically important for the new form of web, the Web 3.0, better known as the Decentralized Web as it is bringing forth a new version of Economics as we know it, known as the “Shared Economies” system, essentially attaching the Blockchain as an immutable ledger in the system to keep perfect records of who owns what cryptocurrencies and who transacted how much with transparency by not revealing identities and encrypting every entry on the Blockchain.
To address privacy concerns, the Blockchain is more efficient as stated above that it uses a ledger to record every entry and is sent to all the nodes for record keeping, there is no case of false or faulty transactions, as each and every transaction is recorded and are securely recorded on the blocks as well.
Cryptocurrencies can not run without the Blockchain as there would be no accountability whatsoever in the system and would be another Decentralized attempt at cryptocurrency which was failed by predecessors B-money and Bitgold.
It is imperative for cryptocurrencies to use the Blockchain as in every decentralized system, the policy is “sharing is king”, every peer can have the same file, movie or music on their computer. Money does not essentially work this way, it needs to work with memory: where it originated from, who owns it, who sent it, who receives it. Hence, the emergence of Bitcoin with a newly introduced concept of consensus, the consensus models essentially consists of Proof-of-Work, a system that calculates various equations to ‘validate the transaction’, upon doing so, the validating node is reaching consensus on the transaction and is ready to be recorded on the blocks.
More improvements have been added since the emergence of cryptocurrencies, the Ethereum platform brought Smart Contracts and DApps on the Blockchain, making it an application development platform with user generated custom assets.
