Introduction:
Techssocial | Circulation of information has never been easier. With the help of the internet, anyone, anywhere, can post or upload any type of record, data, statistics, information, which is used by many other people around the globe; however, everything that we read on the web, is not true. Did you know, that information on Wikipedia, is never 100% authentic? Any user can easily modify the facts on Wikipedia which makes such information unauthentic. In the world of the internet, decentralization the storage of data was impossible without a new programme and in order to overcome such flaws, new technology was introduced, which is known as Blockchain.
Table of Contents
What is the technology all about?
• As the name suggests, a block is blocks of data and chain is stored in a chain of networks. When a massive amount of information is stored in a chain of networks, it is virtually impossible to edit it. Moreover, due to the fact that these are blocks of data, means that this is authentic as well as transparent.
• If people aren’t aware of this technology in-depth, they may assume that it is not secure; however, every bit of data stored under this technology is hidden by applying complex cryptography.
How is it transparent?
• One example of this is in regards to cryptocurrency. All you need to do is know the public address of the company, search for it on a search engine and a list of transactions done by them is displayed in front of you. This is way, there is no chance that these big organizations can hide anything.
• It is also beneficial for any type of company or even for a single person in terms of transferring money. Due to the fact it is decentralized, there is no fee that you need to pay to a bank or to the wallet when you perform a monetary transaction.
A brief history of Blockchain:
The first step:
• Initially, the words block and chain were used separately. The year 1991, was a kick-start to the blockchain history timeline. Stuart Haber and W. Scott Stornetta incorporated this method from the viewpoint of securing document timestamps. A year later, they, in addition to another person named Bayer, developed an improved design of the same system. With the improved technology, they were able to save several blocks of document certificates that could not be tampered with.
• Several years later, a group of unknown people, who are also known as ‘Satoshi Nakamoto’ developed bitcoin that used the technology of the blockchain database. By using this technology, they were able to solve a major problem of the duplication of digital currency due to the fact that the database present in the form of blocks, was distributed across a wide network which is known as the chain with complex cryptography, could not be altered.
A better design:
• In the year 2008, ‘Satoshi Namakato’ group, made some improvements in the design. The new design did not require a trusted party to sign any document and they devised a method where more blocks could be added to the chain, thus, decentralizing the entire system of transactions.
• The bitcoin blockchain database grew from 20 GB in August’14 to 30 GB in January’15 and finally to 100 GB in January 2017. In 2016, they changed the name from two words to a single word in their contract and the technology is now known as blockchain.
• 2008 was the year when blockchain was actually used by bitcoin. Their method incorporated ‘peer to peer electronic cash system’, which eliminated the transaction cost involved in between. The major reason behind its popularity was that this technology stored transactions in a public space and no was allowed to alter or remove it.
Enhancement in the world of blockchain technology:
• The blockchain created by bitcoin had limitations related to its programming which was solved in the year 2013 by Vitalik Buterin and this is when the blockchain history timeline, changed. He realized that this application could be used for many things apart from currency and that is what he exactly did. He designed the second type of blockchain which is known as Ethereum. In 2015, this new design was launched and it had improved methods that could record loans or contracts as well.
• Currently, this technology is used with a wide range of applications. The only drawback of this method is that it can make the transaction process quite slow. The reason behind this is that every new block that is stored, is verified by a miner who uses a very difficult mathematical process to solve it. There are many legitimate miners who get access to such information and the one who solves it first gets an extra incentive; however, the issue here is that it takes a little bit of time for the transaction to be verified.
Future of the blockchain mechanism:
• A system, which is known as, proof of stake, is currently being developed by Ethereum by using an automatic algorithm. The process is almost the same; however, the miner is chosen using that algorithm where it checks for the eligibility conditions. The miner, in this case, does not get an extra incentive but they get to keep the transaction fees.
• New designs and programs are being added to this mechanism that will be more reliable, quick as well as secure.
Conclusion:
From 1991 to 2008 and finally today, the latest form of blockchain technology is used in hundreds of applications. Decentralization of information, data, and transactions have made the world of digitization more trustworthy. Bitcoin is now just a part of these applications that have been launched. The technology is still in a developing stage and companies that are creating new programmes around this ensure that, even with a new and more useful design, the level of cryptography is more complex so that data remains secured and isn’t compromised at any cost.
Hemant is Digital Marketer and he has 6 + years of experience in SEO, Content marketing, Infographic etc.