‘What is blockchain’ is your question. You must be familiar with this word by now if you have heard about Bitcoin. The blockchain is a continuously updated record who holds what.
It is a decentralized peer-to-peer transaction system. It consists of a series of blocks, where every block contains a pointer to the cryptographic hash which points towards the previous block. It also contains a timestamp and transaction data.
What is Blockchain?
The blockchain is an open-source technology which progresses an elective method to exchange or trade cryptographic forms of money.
This innovation isn’t any equipment, and it isn’t freely available to anybody, it is a private system or private enlist in which blockchain goes about as an appropriated record.
This innovation, for the most part, arrives in a photo of digital forms of money where these monetary forms have an overwhelming interest and furthermore high trade.
Cryptographic forms of money headways now moving further with the assistance of this innovation.
Secure resolutions, for example, Blockchain can be a basic building piece to reduce passive consent costs.
You see, the internet is a network of information. It is based on copying and distributing information, be it any type of data.
When you fetch the data from a server, you are looking at a digital copy of the original or master copy. But what about assets.
When you are performing a transaction which is decentralized, there is a chance of having two copies of something that should have only one identity.
This problem is referred to as Double spending problem. Blockchain solved this problem.
It has a throughput of about 10 transactions per second while MasterCard and visa has a throughput of about 80,000 transactions per second.
How it works:
Blockchain can also be called as a ledger which holds all the transactions that have ever taken place.
Every time that a transaction occurs, the ledger is updated. And that ledger is sent to every node in this system. Because of this, there is no chance of being hacked or having a centralized corruption or the risk of failure.
Because if you have to hack a block of the blockchain, you have to hack all the previous blocks holding the transaction.
The computer that looks after the ledgers are called miners. They solve a complex problem of how the transaction occurs.
Each time a problem is solved, it called a block. And it holds 10 minutes worth of the transaction. And for solving the problem, the miners are awarded Bitcoins.
Many banks are also trying to implement their own blockchain but I am not really a fan of a government or bank having control over it.
I hope you have understood what blockchain is and why there should not be a central bank or government controlling a blockchain. For more information about what is Bitcoin and blockchain check out my article linked below.