What is Blockchain

Blockchain is the combination of the two words “Block” & “Chain”. Where the term Block denotes the digital information of the transaction stored in the public database (the chain).
Blocks of the blockchain are made up of the digital pieces of information and have of 3 parts:

• The Block part stores the information about the transactions like date, time, and amount of dollars transacted.
• Block stores the information of the participants who are indulged in the transactions. The participant’s details were added with unique info with digital signature or its user name.
• Block also stores the information which keeps them different from other blocks similarly like our names which differentiate us from others. The blocks store the information in the form of codes called “hash”.

To understand this, let’s consider an example of Wikipedia. Wikipedia is the decentralized information portal which is fully open to the public. Anyone can edit the details & visible for the public and thus transparency is maintained. Similarly, Blockchain technology is accessible for the public and impossible to tamper with the system. The recording and detailing all transactions that have occurred on the relevant chain.

On the other hand, Banking is the centralized system which is managed by the core institutions or by the certain authority of the govt and manage all the transactions globally. This system is costly & slow. Hence it is managed by the single entity and less vulnerable towards the errors, hacking, fraud, etc.

How This Blockchain Technology Works

Blockchain is the long tail of the data or chain which contain the cryptographic hash of previous blocks and each block has the timeframe and transaction amount details.

Distributed Database

The blockchain technology follows the distributed network over the database. From one node of the blockchain whole blockchain database can be accessed. There is no one point of failure which makes the technology robust.

Peer-to-peer Transmission

It is also known as a P2P network, where the computers system is connected instead of a centralized server. So in blockchain, the information stored at the single node will pass to the adjacent node. In this manner, the information is spread all over the network.

Where Blockchain Technology Can be Implemented

This technology has a wide spectrum of the application in the era of digitization. It a revolution in the system record technology.

Internet of Things (IoT)

IoT is the combination of the physical devices which are connected over the internet network. The blockchain technology in IoT will allow your printer to place an order on Amazon when it runs low.

Asset Management

Traditional trade process in asset management is quite complex, expensive & risky. The brokers, custodians, managers handle their own data with inefficiency and make the room for the errors. The blockchain ledgers encrypt the records in properly accessible formats.

Cross Border Payment System

The global payment system is error-prone, costly, time-consuming and also cause money laundering incidents. Santander became the first bank in the world to merge blockchain to a payment app and allows the international payment to clear within a 24 hrs a day.

Smart Contracts

Smart contracts are similar to traditional contracts and have the same agreements & specification. However, the big difference is that smart contract enforces those obligations automatically. It also decreases the risks of running into fraud and increase trust and efficiency.