What is BlockChain?

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What is BlockChain?

The biggest opportunity set we can think of over the next decade.

Bob Greifeld , Former Chairman at NASDAQ

Ever wondered if there’s a more straightforward and easier way to transact, without intermediaries like banks or any financial institutions?

Well, thanks to Blockchain, but what is Blockchain?

The word Blockchain consists of two words i.e., “block” and “chain.” In this context, the “block” refers to Digital Information, whereas the “chain” refers to the public database where the Digital Information is stored.

Blockchain, as the word suggests, consists of multiple blocks linked together. It’s a distributed, decentralized, public ledger. There is no centralized system or institution. The Blockchain can be accessed from every machine, but no one can change the data in any of the blocks. Blockchain is a digital ledger. This ledger is organized into blocks that have a certain size limitation. Once the block gets filled, a new block is created.

The current size of the Blockchain is 264.3 Gigabytes and increasing day by day. You can check the current size of the Blockchain at https://www.blockchain.com/charts/blocks-size.

The blocks on the Blockchain are made up of digital information. The information stored has 3 parts:

  1. Basic information about the transactions i.e date, time, amount of money of your most recent purchase.
  2. Information about who is transacting. The actual name is not used, but rather a “digital signature” is used for privacy.
  3. Information that differentiates them from other blocks of the chain. Every block of the blockchain stores a unique code called a “hash,” which distinguishes it from other blocks. Every block of the Blockchain also contains the hash code of the previous block so that the blocks can be linked.

There are certain conditions for any block to be added to the Blockchain. Those conditions are:

  1. A transaction must occur.
  2. The transaction must be verified. There’s no person or institution for the job when it comes to verification of any transaction on Blockchain. Instead, a network of computers(which comprises of very algorithms) verifies the transaction.
  3. The verified transaction must be stored in a block. After the transaction has been verified, it must be added to a block.
  4. The block must be assigned a hash. There are many algorithms to generate a hash code. A unique hash code is generated for the block, and after that, the block is ready to be added to the Blockchain.

There are both private and public blockchains.

A public blockchain is open, and anyone can be a part of it, whereas the private Blockchain is closed and required permission when somebody wants to join. For example, a company intends to use the Blockchain technology but doesn’t want any outsider to join the network. In this case, they can set up their own Blockchain.

BITCOIN VS. BLOCKCHAIN

Don’t get confused between BITCOIN and BLOCKCHAIN. Blockchain is a technology, whereas Bitcoin is a cryptocurrency or a digital currency that uses Blockchain’s technology for its functionality. Blockchain is the technology behind the cryptocurrencies.

Do you know that the identity of blockchain’s creator is not yet known, but still is used by 0.5% of the population?

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