Blockchain is distributed and public digital ledger that works same exactly like a banking system to record transactions by computers through across the world in that way records and transactions cannot be altered and all subsequent blocks and consensus of network.
Blockchain is actually immutable system of ledger that reads transactions and track assets in any network regardless of network type. Asset can be of any type property, copyrights, branding, cash, car and house.
Mechanism of blockchain:
Many of the cryptocurrencies that are built and are being built under many applications tried the mechanism of blockchain because it really reduces the cost of transactions around the globe.
There are several facets that make blockchain technology unique and valuable for many different types of business applications.
When a new transaction is added(block) it makes the previous transactions much more difficult to modify and that is why the transactions records become more secure, accurate and efficient.
Blockchain Is Accurate:
Blockchain is accurate because the transactions are stored one after another and its difficult to modify the previous one which makes It extremely difficult for anyone to cheat and crack the blocks in that sense this is the most valuable way to make sure all of your transactions are highly secure and there is no hidden money which is being lost which is a common issue in todays banking system.
Blockchain Is Decentralized:
Blockchain is decentralized and it works in the same manner like google docs for instance you send of file to multiple users all the files are updated according to the updated file same exactly all the transactions are updated according to the recent transaction.
How blockchain is created:
The record: What is the transaction
Block: Different types of transactions stored in a single shell which is called the block
Chain: The list of all the transactions
The Steps in a Blockchain Transaction:
Each blockchain transaction, no matter what industry the blockchain is being used for, goes through the same steps:
- The trade or transaction is recorded in a record. The record of the transaction lists the digital signatures from each party and other relevant details.
- The trade is checked to make sure it’s valid. The computers in the network look at the trade and make sure that it is a real trade or transaction. This is a decentralized process that occurs among the different nodes of the network.
- As each transaction is verified and accepted as being real, it’s added to a block. Each block contains a code called a hash that is unique to that block. The block carries its own hash and the hash of the block before it so that users always know where the block should be located in the chain.
- Once the block is complete—blocks can contain many transactions—it is added to the chain. The hash that it carries ensures that it is in proper chronological order.
Blockchain in 2023:
Applications and many companies regardless of there type is using blockchain for transaction mechanism because it really eliminates the duplications of transactions and create great trust and more efficieny
Blockchain is revolutionizing the supply chain, food distribution, financial services, government, retail, and more.
Amazon, IBM and NVidia these are the biggest giants in information technology industries and they all are 100 percent reluctant and using blockchain for there billions of dollar transactions because they have massive transactions which are held in numerous occasions and for that reason orthodox banking system is not advised because it will cost them a lot of money and not even giving them ease that there transactions are 100 accurate and all these things are fulfilled by the help of blockchain.
The best of blockchain:
- Transaction speed
If you want to send someone money in the United States, there are few ways to move money or assets from one account to another faster than you can with cryptocurrency. Most transactions at U.S. financial institutions settle in three to five days. A wire transfer usually takes at least 24 hours. Stock trades settle in three days.
But one of the advantages of cryptocurrency transactions is that they can be completed in a matter of minutes. Once the block with your transaction in it is confirmed by the network, it’s fully settled and the funds are available to use.
- Transaction costs
The cost of transacting in cryptocurrency is relatively low compared to other financial services. For example, it’s not uncommon for a domestic wire transfer to cost $25 or $30. Sending money internationally can be even more expensive.
Anyone can use cryptocurrency. All you need is a computer or smartphone and an internet connection. Cryptocurrency offers a way for the unbanked to access financial services without having to go through a centralized authority. There are many reasons a person may be unable or unwilling to get a traditional bank account. Using cryptocurrency can allow people who don’t use traditional banking services to easily make online transactions or send money to loved ones.
Unless someone gains access to the private key for your crypto wallet, they cannot sign transactions or access your funds. However, if you lose your private key, there’s also no way to recover your funds. As more computing power is added to the network, it becomes even more secure. Any attack on the network and attempt to modify the blockchain would require enough computing power to confirm multiple blocks before the rest of the network can verify the ledger’s accuracy. For popular blockchains such as Bitcoin, Ethereum that kind of attack is prohibitively expensive.
If you keep your crypto assets in your own wallet, it’s far more secure.
Since you don’t have to register for an account at a financial institution to transact with cryptocurrency, you can maintain a level of privacy. Transactions are pseudonymous, which means you have an identifier on the blockchain — your wallet address — but it doesn’t include any specific information about you.
All cryptocurrency transactions take place on the publicly distributed blockchain ledger. There are tools that allow anyone to look up transaction data, including where, when, and how much of a cryptocurrency someone sent from a wallet address. Anyone can also see how much crypto is stored in a wallet.
This level of transparency can reduce fraudulent transactions. Someone can prove they sent money and that it was received or they can prove they have the funds available for a transaction.