Blockchain intends to timestamp (Mark the digital date) on documents to make it impossible to backdate the documents.
This is the first article of blockchain exclusive series on Newzistan, in each article we are going to cover important aspects of blockchain technology, and sharing authentic knowledge with our audience.
What is Blockchain Technology?
We can define Blockchain Technology as a chain made of blocks that consist of information.
The information stock up inside the block is based on the type of the block. Each block has a certain capacity level. Once it is full of data and reaches that certain level, it is closed and is connected with the earlier block.
Every new data is added into a recently developed block that will also connect with an earlier block, once filled with data. Every block which is added to the blockchain is given a timestamp immediately. You can track down the history of transactions easily.
Different kinds of information can be added to Blockchain but the most frequent use is as a ledger for transactions. The decentralized Blockchains are immutable. This means that once the data is entered, you cannot delete or alter it.
Many people mistake Blockchain with bitcoin, which is false. It is the technology at the back of Bitcoin but it is not Bitcoin. You can define Bitcoin as a digital currency. It is a type of cryptocurrency.
Without blockchain, you can’t have bitcoin. But you don’t need bitcoin to have a blockchain. Bitcoin is a widely spread popular application of Blockchain Technology.
How does Blockchain work?
The priority of Blockchain Technology is to permit digital information to be recorded and distributed in the network but not editable.
In this way, A blockchain is a base for immutable ledgers or records of unalterable transactions. That is why Blockchains are also called Distributed Ledger Technology (DLT).
Blockchain works by way of the following steps:
- A permit sharer inserts a transaction that is verified by Blockchain technology.
- This will generate a new block that will contain that specific info.
- That block will be forwarded to every node in the network.
- The verified nodes will corroborate the transaction.
- The block will be connected to a pre-existing blockchain. (Nodes in the blockchain network are given rewards for this task– generally in a procedure known as ‘Proof of Work’ or ‘PoW’).
- This update will be imparted across the network. After this, the transaction is finalized.
What is the future and scope of Blockchain?
Numerous organizations, institutions, and companies through a large number of fields have been interested in this technology and its future.
In addition to that, many have been studying this technology of Blockchain as a sort of advanced technology that can be recognized by the world very soon in the future.
Let’s see the future of Blockchain Technology in different fields.
➔ Future of Blockchain in Cloud Storage:
To understand the blockchain in cloud storage, let me give a brief overview of cloud storage itself.
So, What is cloud storage?
Cloud storage can be defined as — A cloud computing model which helps in storing data. Almost all of us store the data in digital format rather than having piles of physical documents/files.
Blockchain in Cloud Storage:
How Blockchain is helpful to Cloud Storage? In Blockchain Cloud Storage, the data of the user is taken by Blockchain Cloud Storage and is broken into small bits. Then, the additional layer of security is added and distributed across the network.
If a trespasser tries to hack it, they will get the encrypted data first and will only be able to access the chunk of the data and not the whole file.
The benefit of Blockchain Cloud Storage is that the owner is hidden as the data of the owner is not stored in nodes. So, even if the intruder hacks the Blockchain, they won’t be able to access the owner’s data. Thus, all the sensitive information is secured.
➔ Blockchain in Digital Advertising:
Blockchain is a new widely used technology. It stores and secures the data. It started entering into the Digital Advertising field when data inflation and data discrepancy news reached the internet.
Advertisers and Publishers were in search of a preferable alternative for transparency. How blockchain can help in benefitting Digital Advertising? Transparency and accountability are prerequisites in digital advertising.
Blockchain fulfills this requirement. Additionally, With the help of Blockchain technology, you can prevent fraud.
➔ Blockchain in Cybersecurity:
When we talk about blockchain, we often question ourselves: What is the future of Blockchain in Cybersecurity?
Cybersecurity is the system that protects computer systems, network programs, and other data and information. It aims to lessen cyber-attacks.
Most of the social media applications and platforms we use have poor security. The passwords are not reliable. During social media interactions, a large amount of metadata is gathered.
If hackers get access to this data, it can cause trouble. With the help of Blockchain technology, we can create a better security protocol.
As the transactions in the Blockchain are time-stamped and signed digitally, the history of transactions is available and you can track it anytime.
Now we can see that Blockchain technology is really helpful to Cybersecurity. It will bring better and stronger security to the internet.
➔ The future of Blockchain technology with IoT (Internet of Things):
How does Blockchain technology work with IoT? The IoT (Internet of Things) is a system of interconnected, interrelated devices or objects that can gather and transfer the info over wireless systems without any human interference.
How does IoT (Internet of Things) work with Blockchain technology?
IoT allows devices across the internet to send the information and data to private networks of blockchain to form ensconced records of shared transactions.
Every transaction is recorded, placed into a block, added to a chain that is secured and cannot be changed.
➔ Blockchain in the Finance Industry:
What are the advantages of Blockchain in the Financial Industry? With the help of Blockchain technology, the Financial Industry can become more see-through as this technology is a public ledger. It secures the data and prevents fraud and leading risks.
It provides Security, Transparency, and Trust. The Blockchain Technology times stamps the data. So, you can track down the history of data. It protects the data, reducing the risks of any kind of fraud.
Blockchain has brought many benefits to the world. Here are some of them:
Blockchain technology renders a trustless environment. You don’t have to trust anyone else. Every member is provided with the same data in the form of a distributed ledger. If there is any change in any member’s data, it will be rejected by the preponderance of the member
One of the main benefits of Blockchain technology is Transparency. In the Blockchain System, all transactions are visible and can be seen live happening. All the participants have permission access to see the same data.
➔ Better Security:
The data is very sensitive and very pivotal. Having a system that creates records that can not be changed is very helpful for business.
Blockchain Technology Systems have advanced security, protecting the data and preventing any kind of fraud. The nodes contain a copy of the transactions. If an intruder or malicious actor ever tries to make changes, they will be rejected by the nodes.
In simple words, Immutability means that the transactions can not be altered or deleted, once recorded. In Blockchain Technology, the data is permanent and can not be altered. So once the transactions are recorded no one can change them.
Not only immutability of blockchain benefits auditing but it also provides new opportunities in query, analytics, and all-inclusive business process. It benefits the company and prevents fraud.
Even though Blockchain Technology brings many benefits to the world, it is far from being perfect. There are disadvantages of Blockchain Technology as well.
➔ Excessive use of Energy:
Blockchain technology needs a lot of energy which means more electricity is needed. It dissipates a lot of power and electricity.
In a year, the power consumed by Bitcoin miners was higher than the per capita power of different 159 nations. Every time a node is formed, it is connected with every other node concurrently. It consumes a lot of energy.
As the amount of users increases, the number of operations that will be incorporated inside the blocks to be stored will also increase, which will require more space. Ultimately, surpassing the capacity of the hard disk.
➔ Weak Scalability:
The popular application of Blockchain Technology can only control seven transactions per second. With the issue of scalability, the practical use of Blockchain gets a little bit difficult.
Each member node has to verify and approve a transaction. So, one Bitcoin exchange can take hours.
The data on the blockchain is anonymous yet it is in the hands of every node in the network. So, everyone present in the network has the access to that specific data.
There is a chance, someone could detect the identity of a person in the network by way of transactional data, just like web trackers are used by businesses usually.
Thus, it substantiates that Blockchain technology is not totally secured.
In this article, we discussed Blockchain Technology, how it works, its future scopes, and its advantages and disadvantages. It is and Advance Technology that is beneficial for organizations and companies. It creates an unchangeable and immutable record of every single transaction.
Just like internet was a breakthrough in 20th century, Blockchain is a technological hallmark of 21st century, that has the potential to revolutionize the business and its dynamics.
The beauty is the transparency that is the epitome of any business. For students related to IT and anyone who is interested in the field of computer science, must learn Block-Chain.