One of the most frequently used terms in the last calendar year includes the words cryptocurrency (the actual word is Bitcoin) and the word blockchain. The rising cryptocurrency prices in the last year have increased interest in blockchain technology.
What is Blockchain?
Blockchain is a distributed ledger. It utilizes a network of computers and smart code to track information securely and privately. It records data in blocks or chunks. Each block is connected to the previous block and then sealed with an algorithm that functions as a seal that can ensure that no one can alter the data.
The data stored on huge central servers can be vulnerable to accidental or deliberate harm like power outages, attacks, or even fires. Instead of these databases serving as a unifying point of truth, blockchain stores copies of the data on every involved device or computer.
Why Are Banks in Awe of Blockchain Technology?
Before the Internet could be used to offer, for instance, voice calls to India and the US required an investment of billions of dollars, such as AT&T to build the cable it owns between the two countries and use it.
Voice calls were expensive since this infrastructure was very costly. Thanks to the Internet, companies such as Skype can create an application and connect to the Internet for voice calls. Forget calls to voice, and even video calls are now free.
The same is true for banks, credit card companies, etc., who must install infrastructure to protect their ledgers. This infrastructure needs to be designed and maintained by every organization independently. It’s expensive to create and maintain this infrastructure.
What are some applications of blockchain technology?
Bitcoin is probably the most well-known application of blockchain technology. Blockchain technology has a lot more applications than just cryptocurrency. It is a method to safely and easily track all transactional information.
Monitoring supply chains for goods, monitoring intellectual property with smart contracts, and monitoring food or pharmaceutical manufacturing processes to find out the root of problems quickly are just some of the ways blockchain is used.
Some companies that have integrated blockchain technology are Walmart, Pfizer, AIG, Siemens, Unilever, and a variety of other companies. Blockchain technology is a safe digital vote to improve access, trust, and transparency.
Clear and Self-Care
When Satoshi Nakamoto, the founder of Bitcoin, utilized blockchain technology for his currency, decentralization and the ability to be transparent were very valued.
Blockchain technology is highly transparent, in contrast to the central data storage or movement system, which allows the central authority to modify or alter the data in its possession.
This transparency is why some governments want to incorporate blockchain technology into voting. Some companies are also integrating blockchain technology into programs, like reward programs, to make the entire process more transparent.
Self-care is a property that means the blockchain can verify the data on the network and repair it if there is any damage.
This can be done by using computers attached to the networks. Computers aid in maintaining the integrity of the network by examining and verifying each operation (dubbed blocks) that creates chains with the history of every element of data encoded in the chain.
How does blockchain technology work?
So now that we know some of the potential applications using blockchain technology, let’s dive into the in-depth details of how it works to understand how it is important to comprehend the two components of blockchain technology:
collecting and validating information blocks and extracting information from blocks in an efficient format.
What are the four different kinds of Blockchain technology?
The most well-known type of blockchain is Bitcoin, a public blockchain. It is, in theory, open for anyone to join and look at.
However, there aren’t all blockchains that are accessible?
Here’s a brief overview of the four distinct types of blockchain technology.
- Public blockchains:The OG blockchain is an uncentralized, distributed ledger open to anyone who wants to join and where all transactions are publicly visible.
- Private BlockchainsThey operate within a single company. They operate on the same principle for a distributed ledger instead of central data sources. Thus, they have some of the security that blockchains offer but do not have the transparency.
- Blockchains that are Federated:Pooled among a group of organizations, they not open to everyone.
- Hybrid blockchains:Semi-public. Members of the system determine who can access the system to which transactions are considered public.
- Blockchains may also be granted permission (i.e., require specific permission to access or meet specific criteria) or non-permission less (anyone can participate in transactions or verification).
What are the negatives of blockchain?
1: Blockchain has a lot of power
One of the major complaints against blockchain is it’s power-hungry and slow. PoW is the most widely used method of confirming transactions that need significant energy. Presently, Bitcoin mining alone consumes more electricity than in Belgium.
Additionally, a limit on block size and the relatively slow speed of transactions, particularly for public blockchains validated with PoW, limit the blockchain’s capacity.
2: Blockchain is safe up to the point that it doesn’t
Blockchains, in theory, are safe. Because changing and accessing the chain could be quickly detected and blocked, it’s never ideal for hackers to spend their time trying to alter or access blockchains.
It was believed that hackers would be better off investing their computing power to mining Bitcoin for a long time.
But as blockchain technology becomes more widespread, it’s challenging to know what it will do if targeted.
Since validation is based on consensus, if anyone could have control of more than half the nodes, which is known as an attack of 51 and could alter the blockchain. It was already the case during a Bitcoin spend spree carried out by hackers in 2019.
3: Blockchain is a memory-based system that has a long life
In all the possibilities that sound utopian, there are drawbacks to a giant, indestructible ledger.
Consider the tiny voice that wakes you up at 3 am. It’s the one that gives you a comprehensive list of all you’ve made or done that seemed off or embarrassing.
The voice that never forgets. The blockchain isn’t any different. What test did you take regarding the time of the rash? It was recorded forever. The long-forgotten arrest during an event at the age of 19? You’re still there.
For regions or countries that have strict data-protection laws, like GDPR within the European Union – it’s unclear how blockchain technology will function.
Can blockchain be a lucrative career?
After reading this article, it’s evident that blockchain will continue to grow in popularity and popularity despite all the hype and the possible negatives. Therefore, it’s likely to conclude that the need for positions that are knowledge about blockchain will grow.
Blockchain technology is used across a range of industries. You could consider what your future career choices are. Let’s review some job opportunities in technology and the qualifications you’ll require.
