Blockchain technology was preliminary introduced for the bitcoin virtual currency, however now it’s increasingly being used to track and validate different types of assets, from electrons and stocks to bonds. Decentralized digital ledger technology holds the potential to revolutionize numerous sectors of the economy.
What is Blockchain?
Before we move any further, let us understand the concept of Blockchain. This is an innovative technology that records a list of transactions in a way that averts dishonest use, like double spending and tampering. They enable a computer to keep a track by compiling the records into a block, which is then encrypted to create a number named as ‘hash’.
The encryption process within this entire set up is extremely vital. It can be categorized as an algorithm that can be calculated easily, but when it comes to reverse process, like factorization, it becomes a complex process. The resultant hash value is a unique characteristic of the block, and any tinkering with the records, changes the hash, making it immediately evident.
New transactions are amassed together into another block and added to the current hash value. Then it is encrypted to build a hash for the new block. It is further added to the subsequent list of transactions as they get encrypted, and this process continues. The outcome is a series of blocks that each comprises the hash values of all previous blocks, and thus getting its name – Blockchain.
All the systems that store these blocks repeatedly compare the hash values to validate whether they are in agreement. In the instance of any disagreement, the respective computer throw-outs the records that have been causing issues.
The growing industry
Last year, the industry witnessed a growth of many Blockchain startups in different sectors, right from financial services, energy trading, supply chain custody, remittances to global development and health care. In the ongoing year, we may see the emergence of preliminary Blockchain consumer platforms release.
Whereas a Blockchain can support the costless substantiation of the attributes it transmits, recording those elements may require intermediaries and labor-intensive plans to avert fraud. In this segment, sensors and internet-of-things devices can radically expand what can be fabricated on top of this decentralized digital ledger technology.
From the long-term scope, cryptocurrencies show the potential to transform the way internet services are delivered; open-source communities support their development; the way micro tasks and expertise are crowdsourced; the payment mechanism for media and content; and the process to harness talent.
Irrespective of the context and sector, there’s a strong probability that Blockchain will affect different businesses. The only big question is when it will happen? Instead of looking for an answer to that question, let us embrace Blockchain and explore how can we capitalize on this decentralized digital ledger technology.