What is blockchain technology and how does it work?
Although the concept of blockchain is very old, people’s interest in blockchain technology has increased a lot in recent years due to the growing popularity of bitcoin and cryptocurrency. Because most cryptocurrencies work based on this blockchain technology. So in today’s article, we will try to give a brief idea about what blockchain is and how it works.
What is a blockchain technology?
The general meaning of blockchain is a chain made of blocks. And we all know what chain means. A chain is a combination of similar elements as well as a chain attached to one another. So, the term blockchain refers to the formation of a chain of blocks by attaching many such blocks to one another. And the blocks that make up this chain basically store data.
Technically, a blockchain is a distributed laser that is open to everyone on the internet. When data is inserted between blocks in a blockchain, it is almost impossible to delete that data or make any changes to that data. But how?
Blockchain technology elements
To know this, at first, you must know what is in each of these blocks. Each block in the entire blockchain basically has three things-
1) The block has its own information.
2) The own hash of the block and
3) The hash of the previous block attached just behind this block.
Everyone understands information, but what is a hash? Hash is basically an identifier. The hash of each block is absolutely it’s own and specific to each. That is, the hash of two or more blocks can never be the same. This is a lot like a human fingerprint. Just as the fingerprints of two people can never be the same, the hashes of two blocks can never match. These hashes are generated according to the information stored in each block. That is, if the information in a block is changed in any way, the hash of that block will also change.
This is why the hash of the previous block is also stored in each block. If each block traces the hash attached to it, no one will be able to change the information
in any block at will. So it is almost impossible to delete or change every piece of information entered into the blockchain. Because, in this case, if you want to change the information in a block, you have to change the information in that block as well as all the previous blocks. Otherwise, the whole blockchain will stop working.
How does blockchain work?
By now you must have understood how blockchain technology ensures the security of information. But another big reason blockchain is secure is its distributed network system. Blockchain basically creates a pair-to-pair network where the information of each block in the blockchain can identify any individual blocks with an internet connection. When a newcomer registers to this blockchain network, he gets a copy of all the blocks in front of him and before him. And he identifies each block and makes sure that every piece of information in the blockchain is still correct. The more times each block in a blockchain is identified, the more information becomes irrevocable. This is basically how blockchain technology works.
Did you know that each cryptocurrency transaction usually takes at least 10 minutes to process? This is because of this blockchain. For cryptocurrency transactions, each new block is created every 10 minutes for security reasons. So when you request a transaction, you have to wait at least 10 minutes to create a new block with that transaction.
Advantages of the blockchain system
Getting rid of third party hassles: Looking at the above examples, you will understand that blockchain transaction management does not require any third-party access. As a result, anyone from any part of the world can transact without any hassle. Which is very troublesome in the conventional banking system.
Security: Think of the PayPal transaction system. Money or user information sent from here at any time may be stolen; But because of the anonymity of the blockchain system and the constant updating of information, theft or corruption is almost impossible to infiltrate.
Corruption Eradication: If it is used in government transaction management in the context of a corrupted country, think about how much the rate of corruption in government transaction management will be reduced.