What Is A Blockchain?

In this period of advancing technology and non-stop increase in the number of people using the internet, it is already predetermined where our future sets. The powerful tool in making life easy and working things in a more efficient manner is not only visible to programmers and those who were considered to be computer geeks.

Even laggards or people who are often behind by the trends and were considered to be as snail market already knows about the existence as well as the supremacy of the internet.

We utilize as we take advantage of the functions of it as well as enjoy the convenience brought to us by advancing technology. It is evident in our day-to-day routines.

As the number of users practices the usage of internet, business entities and the banking industry doesn’t want to be left behind.

If you are into banking, investing and you follow business magazines then you must already be familiar with the term “blockchain” which also goes along with the digital currencies such as bitcoin, litecoin, stellar, ethereum, and the likes.

But if you are not, then you must be wondering WHAT IS A BLOCKCHAIN and how does it work?

In its simplest definition, blockchain is a virtual ledger.

Then, you must be thinking, where does the name come from? How did it gain its name?

In an elementary term, blockchain is a block of chains. When we say ‘block’, that’s the digital or data information. And if we say ‘chain’ that means public database. Thus, if we come it together, blockchain is digital information stored in a public database.

How does it work?

As told, blockchain in its simplest definition is a virtual ledger. Thus, it is the digital record behind those cryptocurrencies around. It works as a public virtual ledger which is accessible to anyone who has access to the internet.

To simply explain how blockchain works, take this scenario.

Have you tried working on a Microsoft Word document? If so, then you can notice that if you’re using such, after saving the file and sending it to your recipient for some document revisions, you still need to wait for the recipient to finish the job and then from the recipient sending the file back to you for you to see it.

On the other side, if you are using Google Docs, then you can have your file, send the link to your receiver and have them revise the document. The difference in there is that you will be able to see in real time revisions, with updated information being inputted to said document. And both of you can at the same time access the document in real time.

Our banks today work just like how the concept of MS Word works. They transfer money and have to wait for the other end to make the balances---increase or decrease it then update to another side, re-open it and so on.

But with blockchain, just like the concept of Google docs, having anything and basically, everything in real time, validating transactions by recording it not only in a single register or system but on a connected distributed systems.

With such way of using a network, having it stored not just in one single location but by multiple computers simultaneously with its data being publicly accessible to anyone, this discourages and gives no room for any hackers to any form of unscrupulous acts.

Supplementing Reads For You