How Blockchain Works in Six Steps
The future of apps, programmes, trading, investing and businesses all lie in one underlying technology – Blockchain.
You’ve probably heard about it when it comes to crypto-currencies.
But it extends so far beyond them.
In this section, you’ll think of it in a whole new level where you’ll be able to:
• Understand blockchain in a nutshell
• Understand the power and possibilities it will bring to the world
• See the trading and investment opportunities to come
Let’s get to it…
What blockchain is in a nutshell…
In short, a blockchain is one continuous digital ledger of records and transactions which are organised, verified, and positioned next to each other in ‘blocks’ linking a permanent and transparent chain of other ‘blocks’.
Here’s a short illustration on how a Blockchain works…
The important concept with blockchain is that, the chain “ledger” of transactions are neither stored in a central location nor is managed or run by a single entity.
We say the blockchain is decentralised, secure and the transactions are added permanently in a transparent and resilient manner using cryptography (special codes).
The parties between the transaction will also remain anonymous while enjoying the security, transparency, speed and cost efficiency.
This will have major advantages over centralised systems in a way that:
• The transactions will be easy to track
• There’ll be less manipulation and corruption
• There’s more transparency
• There’ll be less costs and less middlemen.
NOTE: To alter one block, you’ll need to change every block throughout the network (which is virtually impossible).
And as the historical blocks information stays the same – you’ll be able to forever track the old transactions with the given public information.
I’m talking about these main sets of information each ‘block’ has.
1. The data of the new block (code or digital fingerprint)
2. The hash of the previous block (code – letters & numbers)
3. A time stamp
4. Transaction data
Once you understand the process and how secure a blockchain is, you’ll see how it will not only disrupt industries but it will also change the global and financial economy as we know it.