Advantages of blockchain: An era of financial digitalization has already begun. We all know that with the introduction of ‘bitcoin’, blockchain came into highlight as well. But have you ever queried where this term came from? What is the actual concept behind this technology? And why it’s the hot topic all over the internet?
So basically, blockchain is a digitalized, decentralized, public ledger; which was originally developed by Satoshi Nakamoto as the accounting method for the virtual currency bitcoin. It is now designed for all the cryptocurrency transactions.
What is a cryptocurrency?
A cryptocurrency is a digital asset or digital virtual currency which uses strong cryptography and is designed to work as the medium of exchange for financially secure transactions. There are 1,658 cryptocurrencies estimated, although all of them are not significant or even legitimate. The 5 largest cryptocurrencies in the world are bitcoin, ethereum, ripple, bitcoin cash and litecoin.
It is important to note that blockchain is usually governed by the peer-to-peer network which is collectively binding to a protocol, to create inter-node communications and new blocks. The data cannot be altered in any given block after getting finalized.
Advantages of blockchain: Durability and efficiency:
A great advantage of blockchain technology is that it gives no hint of failure at any point. Also, it is not controlled by any single entity, which gives us knowledge of its high reliability. Till date, not a single flaw came into discussion. Either it was human errors or mismanagements.
Advantages of blockchain: Transparency and trustworthiness:
The blockchain is a self-auditing system which automatically checks itself within every ten minutes. The intervals happen when the network reconciles the transactions. This delivers the fact that transactions on blockchain are broadcast.
Advantages of blockchain: Distributive ledgers:
Distributive ledgers are the backbone of the blockchain. To understand this better, we must go in a deeper analogy. For the blockchain database, each participant maintains, calculates and updates new entries into the database. All nodes work together to ensure they are all coming to the same results.
Advantages of blockchain: Decentralized technology:
Blockchain opened a new gateway for digital transactions. The most simultaneous way of trade on blockchain is stock market. The transactions are public on this database which confirms its authenticity.
Decentralization means the network operates on a user-to-user basis. For e.g. Bitcoin is managed by the network as a whole; there is no central authority. This kind of technology makes the traditional commerce (like- record keeping, accounting, registry, etc) unnecessary.
Advantages of blockchain: Cancelling intermediates:
We always find ways to limit our expenses as much as we can whether they are commercial transactions or legal transactions (Well… I wonder why?). Back to the topic, whenever we indulge in any business; third parties like banks, social media companies, credit card companies, government; receive 10-15% of our money.
With the help of cryptocurrencies and blockchain, we can disable our double expenditure and keep executing the deals peer-to-peer.
Advantages of blockchain: Security enhancement:
By storing data across its network, the blockchain eliminates the risks that come with data being held centrally. The network lacks the centralized points of exposure which can get exploited by the computer hackers. In the world of social media, there are always chances of getting our data leaked or other security problems. Blockchain security methods use encryption technology. It is based on ‘private key’ and ‘public key’. A public key is a user’s address on the blockchain.
What are private and public keys?
These are actually the concepts of bitcoin. A private key is used to create a digital signature on your transaction. It should be kept secret all the time. A public key contributes as a user’s address plus also verifies your digital signature.
Blockchain stores your data which is permanently incorrupt, although you have to maintain the security of your digital assets.
Advantages of blockchain: Smart contracts:
In simple words, a smart contract is a computer protocol which allows the performance of digital transactions without middlemen. Insiders guarantee that with the help of this coding, voting systems of government can get more secure. Secondly, it will cut out the discrepancies that occur during business operations. Beside this, smart contracts will also help to manage IOT (Internet of Things).
Jobs and careers:
The blockchain is not just a network for transactions. It can also benefit people professionally. According to Upwork’s skills index, blockchain is the fastest-growing skill out of more than 5,000 on the site. According to Burning Glass Technologies, more than 5,743 full-time job openings were posted that require blockchain technology skills.
No matter it’s a start-up or a well-established company such as IBM or Samsung, everywhere there is a high demand for workers who have blockchain skill. Since there is no leader to claim, people who are experts in this technology have a lot more opportunities than anyone else.
Article By Ayushi Goswami