An introduction to blockchain technology for beginners

Nowadays, technology is scaling to new heights of success at an incredibly fast pace. One of the latest victories in this direction is the evolution of blockchain technology. New technologies have greatly impacted the financial sector. In fact, it was originally created for Bitcoin – the digital currency. But now, it finds its application in many other fields as well.

This was probably the easiest to come across. But, what is blockchain yet to know?

A distributed database

Imagine an electronic spreadsheet, which has been copied countless times across a computer network. Now, imagine that the computer network is so smartly designed that it regularly updates the spreadsheet on its own. This is a broad overview of blockchain. Blockchain holds information as a shared database. Moreover, this database is continuously matched.

This approach has its own advantages. It does not allow storing the database in any single location. The records in it have true public attributes and can be easily verified. As there is no centralized version of the records, there is no way for unauthorized users to manipulate and destroy the data. Blockchain distributed databases are hosted by millions of computers simultaneously, making data easily accessible to almost anyone across the virtual web.

To make the concept or technology clearer, it’s a good idea to discuss the analogy in Google Docs.

Analogy to Google Docs for Blockchain

After the advent of email, the common way to share documents was to send a Microsoft Word doc as an attachment to a recipient or recipients. Recipients will take their sweet time going through the revised copy before sending it back. In this method, one has to wait till receiving the return copy to see the changes made in the document. This happens because the sender is locked out from making edits until the recipient completes the edits and sends the document back. Concurrent databases do not allow two owners to access the same record at the same time. This is how banks maintain the balance of their clients or account holders.

Unlike set practices, Google Docs allows both parties to access the same document at the same time. Moreover, it allows viewing a single version of both documents simultaneously. Like Shared Ledger, Google Docs also works as a shared document. The distributed part becomes relevant only when the sharing involves multiple users. Blockchain technology is an extension of this concept. However, it is important to note here that blockchain is not for document sharing. Rather, this is just an analogy, which will help to get a clear idea about this cutting-edge technology.

Notable Blockchain Features

Blockchain stores blocks of information across the network, which are identical. Because of this feature:

  • Data or information cannot be controlled by a single, specific entity.
  • There can be no single point of failure.
  • The data is kept on a public network, which ensures absolute transparency in the overall process.
  • The data stored in it cannot be destroyed.

Demands of Blockchain Developers

As mentioned earlier, blockchain technology has a very high application in the world of finance and banking. According to the World Bank, more than USD 430 billion in remittances were sent through it in 2015 alone. Thus, blockchain developers are in significant demand in the market.

Blockchain eliminates the middleman’s salary in such financial transactions. It was the invention of GUI (Graphical User Interface), which helped common people to access computers in desktop form. Likewise, wallet applications are the most common GUI for blockchain technology. Users use the wallet to buy things of their choice using Bitcoin or any other cryptocurrency.