This article provides a brief overview of Blockchain technology, also known as distributed Ledger Technology. This technology isn’t new but it has been growing in recent years. Cash, a virtual currency that was competing with cash, was taken from circulation in March 2021. Waves, a second currency, followed suit. Both of these currencies have now been taken out.
Blockchain (also known as Distributed iTunes Blockchain Ledger Technology) is becoming the new buzzword in finance. This technology allows for multiple parties to join hands on a single ledger. They don’t need to send transaction requests through a central repository. Instead, transactions are performed peer-to–peer. There is no actual money in the ledger. Instead, information is cryptographically protected on multiple computers to ensure that only authorized persons can access the ledger.
When a buyer wishes to purchase goods from an internet vendor, the transaction is entered into the Block Transaction Network, (BTN), and then it is monitored by CBN, the central authority. After all the parties have completed the transaction, they add their signatures and then transfer the money from their account to that of the seller. This is a way to ensure that the transaction was valid. It also gives the seller ownership of the goods. As the buyer and the seller sign the final transaction, the process is repeated.
But this is not the end. To make the Blockchain truly useful, it must have its own network, or “miners”, of peers. Each miner generates blocks of transactions independently, which secures the ledger. These distinct entities are commonly called “relayers”, while the entire process is overseen and managed by a group or individual of experts known as “consumers”.
What is the Blockchain? First, let’s understand how the protocol works. A “blockchain boilerplate”, the main piece or software that runs on top the Blockchain, is what is known as the scripts or commands that create the “blocks” in the Blockchain. These blocks contain the actual transactions between buyers and sellers through the marketplaces. To ensure it is unalterable, the script or command has been cryptographically signed by multiple parties.
What is the Blockchain’s approach to the various transactions it can make? Blockchain is designed to facilitate a specific type of decentralized trading. Decentralized exchange is a term that refers not to the fact that participants to the transaction need not trust the ledger to be able to trade. This is in contrast to traditional exchanges where the participants must have some trust to be able to purchase a particular type of product or services. Blockchain is a completely online exchange that does not require any intermediary or third-party involvement. This makes it stand out from other decentralized exchanges.
How does the Blockchain achieve this feat? Once someone starts to enter into transactions, they basically chain together all their private transactions into a chain. Every transaction is given a “block”, which contains a reference the previous block in that chain. Blockchain does more than chain transactions together. The entire transaction chain must be copied safely and accurately because each participant has their private keys. This ensures that there is no human error and no hardware failure.
This concept can be applied to any time scale as the Blockchain is able to facilitate any type of decentralized transaction within any business hour. It doesn’t really matter if transactions are simple, one-way bidding and offers. A company can offer another company its product using Blockchain as the ledger. Or, it could be networks like eBay which allow buyers and sellers directly to transact using Blockchain without needing to go through a broker. The Blockchain allows businesses to conduct all transactions within the hours of business.