How does Blockchain Technology works?

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After reading this article you will understand how does blockchain technology works? Or how a block works? First we need to understand the definition of blockchain

1. What is Blockchain?

Blockchain is a decentralized digital transaction ledger, an ever-growing list of electronic records, which will be retained for a long time. Its security is ensured through encryption (an algorithm code). Blockchain ledger data is distributed in a computer network. Users can directly interact with stored data in real-time without the need for intermediaries (“middlemen” or distributors) to verify transactions. This technology provides an independent, tamper-proof and transparent platform for all parties in the blockchain to store, transmit and process sensitive information safely.

Entire work of blockchain
Picture shows how does blockchain technology works?

2. What is Block or how a block works?

Each transaction or record on the blockchain technology is stored in a “block.”  Block works as a  digital public ledger that store transaction record which is difficult to hack or alter.

Blockchain usually refers to real-time, unalterable transaction and ownership records. But what does this mean? Simply put, the blockchain is a recording system that can record various transaction information and the ownership information of any asset reliably and safely.

This is like a database that stores information in blocks. These blocks can be copied on a personal computer. The blocks on all computers are the same and kept in sync with each other. When someone adds or deletes data, the information in all blocks will change accordingly.

Each block is as secure as your online banking portal, almost impossible to crack. Blockchain ledger can serve all kinds of vouchers, including loans, land deeds, logistics freight bills, and nearly all valuable things. Big data information can be shared in a multi-validation environment, which is very suitable for real-time and secure information sharing.  As the number of vertical markets using blockchain increases, compliance with data privacy laws becomes critical.

4. Uses of blockchain

Blockchain as a service (BaaS) combines a blockchain distributed ledger platform with a cloud software delivery and licensing model. Companies that want to improve safety and efficiency while reducing costs like this model very much. Since the service provider maintains the BaaS network in the cloud, BaaS can provide the accountability, transparency, and security that are unique to the blockchain without using internal corporate resources. Gartner predicts that by 2030, the commercial value created by blockchain technology will reach US$3.1 trillion, which shows that the development momentum of blockchain technology is powerful.

Blockchain plays a vital role in safety. The reason is: new blocks (containing new information) are always added to the end of the chain. Every time a new block is added, a corresponding digital signature or hash value is generated, which is a series of numbers and letters. Imagine various confidential mathematical codes. After adding a new block to the blockchain, if a certain amount or number in the block is changed, these signatures will also be changed.

5. Is blockchain can be hacked?

If a hacker wants to alter or change the data of a block in the blockchain, he must make corresponding changes to all the information before and after the block that is impossible.

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