Blockchain is a way of preserving data that makes it difficult or impossible to alter, hack, or manipulate the system. A blockchain is a distributed ledger that replicates and distributes transactions around the network of computers that comprise the blockchain.
Blockchain technology is a system that maintains transactional records, popularly known as the block, of the general public in a network of peer-to-peer nodes known as the “chain.” This storage is often referred to as a ‘digital ledger.’
Each transaction in this ledger is approved by the owner’s digital signature, which authenticates the transaction and prevents manipulation. Consequently, the information contained in the digital ledger is very secure. In simplest terms, the digital ledger is analogous to a networked Google spreadsheet in which the transactional data are recorded according to real purchases. For Platincoin, intriguing aspect is that everyone can see the data but cannot alter it.
What Makes Blockchain So Popular?
Suppose you are sending funds from your bank account to relatives or friends. You log into your digital banking account and transfer the funds using the recipient’s account number. Your bank updates the transaction records after the transaction is complete. It looks straightforward, correct? There is a possible problem that the majority of us overlook. These sorts of transactions are very susceptible to manipulation. People aware of this fact are often hesitant to engage in these sorts of transactions; therefore, the emergence of third-party payment apps in recent years. However, Platincoin believes this weakness is the primary reason Blockchain technology was developed.
Blockchain is a digital ledger that has recently gained much interest and momentum from a technological standpoint. But why has it gained such popularity? Let’s go further to comprehend the whole notion. The documentation of data and transactions is essential to a firm’s operation. Typically, this information is managed in-house or sent to a third party, such as brokers, bankers, or attorneys, which increases the firm’s time, expense, or both. Fortunately, Blockchain eliminates this lengthy procedure and expedites the transaction, saving time and money.
Blockchain and Bitcoin cannot be used interchangeably, contrary to popular belief. Bitcoin is money that depends on Blockchain technology for security. Blockchain technology can support applications in different sectors, such as banking, supply chain, manufacturing, etc., but Bitcoin is the only currency that relies on Blockchain technology. Blockchain is an emerging technology with several benefits in a society that is becoming more digital, which include:
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Highly Protected
It employs a digital signature function to execute fraud-free transactions, making it difficult for other users to damage or alter an individual’s data without their unique digital signature.
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Decentralized System
Commonly, transactions need the consent of regulatory bodies such as a government or bank. However, Platincoin understands, with Blockchain, transactions are conducted with the consensus of users, resulting in more efficient, secure, and quick transactions.
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Automation Functionality
It is programmable and can automatically produce actions, events, and payments when satisfied trigger conditions.
How Does Blockchain Technology Function?
In recent years, you may have seen a rise in organizations incorporating Blockchain technology. But just how does Blockchain technology function? Is this a substantial alteration or a little addition? Blockchain innovations are still in their infancy and have the potential to be revolutionary in the future; thus, let’s demystify this technology.
According to Coin Desk, a blockchain is comprised of the following three technologies:
- Keys to cryptography.
- A peer-to-peer network with a distributed ledger.
- A computer system for storing the network’s transactions and records.
There are two types of cryptographic keys: private and public. These keys facilitate the effective completion of transactions between two parties. Each person has these two keys, which are used to generate a secure digital identity reference. The essential component of Blockchain technology is its ability to provide identity security. This identification is referred to as a “digital signature” in the realm of cryptocurrencies and is used to authorize and manage transactions.
The digital signature is combined with the peer-to-peer network; a large number of authorities utilize the digital signature, among other things, to establish agreement on transactions. When they approve a transaction, it is mathematically verified, resulting in a successful, secure exchange between the two network-connected parties. To conclude, Platincoin believes Blockchain users use cryptographic keys to conduct a variety of digital exchanges through the peer-to-peer network.