Last Updated on June 8, 2023 by Umer Malik
Blockchain is a new technology that has begun to develop and become popular thanks to cryptocurrency. It is widely discussed in the field of financing, is used to identify, store and process personal data. Blockchain is a special database with financial transactions. It consists of chains with digital blocks that are built sequentially. Each chain has details about the next or previous block. All records that are presented in the system are unchanged, which is explained by the hashing mechanism. This is a unique set of letters and numbers, in which a change in just one character can lead to changes in other blocks. The main feature of the blockchain is its transparency, because each user can get acquainted with the data that is stored inside the blocks, but cannot change or delete it.
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Blockchains are used in various fields of activity where high speed and reliability are needed. These are the following areas:
Cryptocurrency –
the entire cryptocurrency works with the help of the blockchain. Such a currency is used in order to make a profit on increased volatility. Active traders use the blockchain as a tool for a large number of money transfers;
Digital Currency –
China, the U.S. and some other countries are using blockchain to create a digital currency. If the testing is successful, such a currency can be used to pay at retail outlets and make transfers;
Smart contracts –
thanks to them, the blockchain tracks the supply chain of goods in detail and finds out its authenticity. This feature allows you to exclude the likelihood of forgery, find out the date and features of production;
NFT
modern certificates confirming the rights to digital art. This is a popular crypto asset that is common for purchase on various marketplaces;
Gaming industry – various games are presented in the blockchain sphere. Gambling providers are implementing blockchain technology to record everything that happens.
On the website of the https://www.lition.io/, you can find out the infrastructure of the blockchain of the 2nd level. This is a scalable blockchain, which is complemented by the function of deleting data.
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Who first invented and described blockchain technology?
Officially, the history of blockchain begins on 31.10.2008. The technology was mentioned by a person under the pseudonym Satoshi Nakamoto in a special core document.
The fundamental principles of the use of decentralization, immutability, helping to keep proper records of documents, were laid down in the distant 1960. But closer are the works of scientists such as Stuart Haber and W. Scott Stornett. For the first time they described the feature of creating blocks with a hash in 1991. This technology was even patented, but interest instantly disappeared, because there was no technical possibility for its implementation. The patent expired in 2004.
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What are the risks of blockchain technology?
Modern technology is being actively implemented in many banking systems, and the bank is used as a regulator between cryptocurrency and users. But at the moment, cryptocurrency can not be equated even to foreign currency, because it is similar to pyramids.
One of the features of the blockchain is anonymity. Clients conduct financial transactions without worrying about what they can be identified. These conditions are great for attackers, so the blockchain is often used for illegal actions. This is the first and main drawback of the system. Also, the disadvantage of the system includes the fact that its active use can reduce the number of jobs. If the blockchain is actively used, then intermediaries in various fields of activity will not be needed, namely when processing documents, during money transfers or in insurance.
The disadvantages of the blockchain also include the fact that monetary assets can easily disappear without compensation for any loss, and the value of almost all cryptocurrency does not correspond to the real price of the asset.
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