Given the significant developments that we are experiencing in our present time and the increasing number of transactions, information, and data we keep. Our need for a huge database has increased to ensure that the asset is not disavowed, and the stored data’s reliability for life. As a result, the blockchain aims to form the ideal solution to the problem. This ensures the validity of transactions for contracts. So, what is blockchain and how does it work? That’s what we’ll recognize in this article.
Definition of blockchain technology
It is a kind of distributed or shared database between computer network nodes, and since this technology acts as a database, it stores information electronically in digital form. In addition, blockchain is non-adjustable and used in transaction registration and asset tracking in the business network and is therefore a guarantee of reliability of information.
The original can also be tangible (house, car, money, land). or intangible (intellectual property, patents, copyright, trademarks). The blockchain thus serves many areas of life to guarantee rights and assets.
The founder of This technology
Cryptologist David Chaum first proposed a blockchain-like protocol in 1982. He wanted to implement a system in which the document’s time stamps could not be tampered with.
In 1992 Haber, Stornetta, and Dave Bayer incorporated Merkle trees into the design. This improved its efficiency by allowing many document certificates to be collected in one block.
The primary founder of the first decentralized Block Chen was a person (or group of people) known as Satoshi Nakamoto in 2008.
Nakamoto importantly improved the design by using a Hashcash-like method of time block characters without signing by a reliable party. It also stabilized the blockchain adding rate.
How does Blockchain technology work?
As simple as this, blockchain brings information together in groups known as blocks that have certain storage capacities. When one block fills, it will close and bind to the pre-filled block, etc., and so on…
The differences between a database and a blockchain
The fundamental difference between blockchain and a regular database is that the database usually builds its data in tables, while blockchain builds its data in interconnected blocks.
Blockchain supports stability, which means it is impossible to erase or replace recorded data, and therefore blockchain prevents data tampering within the network.
While the traditional database does not show stability. This is because it uses CRUD (create, read, update, and delete) at the base level to ensure the proper application operation. The CRUD model enables easy data erasure and replacement.
Therefore, fraudulent officials or third-party piracy can manipulate traditional database data.
This technology also consists of growing lists of records called blocks. Each block contains an encryption fragmentation of the previous block, a chronological character, and transaction data, and the temporal character proves that the transaction data existed at the time of the block’s creation. While the database does not provide any of those details.
Benefits of Blockchain
- Stability
As we have already mentioned, it is impossible to erase or replace the data recorded in this technology, therefore, it is impossible to tamper with the data within the network, making it a reliable network.
- Transparency
it is decentralized, meaning any network member can verify the recorded data in a blockchain. So that the public can trust the network.
- Oversight
This technology is censorship-free and does not control any party, so no single authority (including governments) can interrupt the operation of the network.
- Traceability
This technology creates an accurate and irreversible path, allowing easy tracking of changes on the network. Thus, we can say that it is a fully transparent technology.
Disadvantages of Blockchain
- Speed
Blockchain is much slower than a traditional database because this technology implements more operations.
First, the signature is verified, which includes the signature of transactions in an encrypted form, and then a consensus mechanism is implemented to verify the authenticity of transactions, some consensus mechanisms such as proof of work have low transaction productivity.
Finally, we have the redundancy phase, where the network asks each node to verify and store each transaction.
All these processes with the slow performance of some, significantly slow down the performance.
- High implementation cost
Blockchain is more expensive than a traditional database. In addition, companies need to plan and execute appropriately to integrate this technology into their process.
- Difficulty in modifying data
Blockchain technology does not allow data to be easily modified once recorded and requires code rewriting in all blocks.
This takes a long, expensive time. making it difficult to correct any errors or make any necessary modifications within the blockchain.
- Does not fit all requirements.
Many companies are looking to use blockchain. However, they must do due diligence and explore whether blockchain technology fits their needs.
Types of Blockchain
- Public blockchains
There are no restrictions on public blockchain access.
The future of this type is that anyone with Internet access can send transactions to them and become an auditor (participate in the implementation process of a consensus protocol).
One of the most popular public blockchains are Bitcoin and Ethereum blockchains.
- Private blockchains
In this type, one can only join Blockchain at the invitation of network administrators who restrict the participant’s and auditor’s access. Scientists call this species the terminology distributed ledger (DLT).
- Hybrid blockchains
Hybrid blockchain has a range of central and decentralized features and based on these features the exact working methods of the series vary.
- Sidechains
They are independent chains running next to the original blockchain, also called the main network.
One of the main tasks of these chains is to solve the problem of scalability that prevents block chain from becoming a mainstream technology currently.
You may also like: Internet of Things (IoT) and Cyber Security
Sweat coins
As we know, Sweet is one of the most interesting new blockchain projects in the market. Users can create SWEAT coins simply by walking, jogging, and exercising.
The project also raised more than 13 million dollars throughout 2022, demonstrating a large community behind it as Sweat works on Ethereum.
