If you have been following cryptocurrency for the past five years, you are well aware of the blockchain technology.
For newbies in cryptocurrency, you probably encountered several terminologies wherein you have no idea how it means. And, one term you might have stumbled on is the blockchain technology. It seems too technical and difficult to grasp. But actually, blockchain technology is a simple concept that is easy to understand more than how it sounds.
Defining Blockchain Technology
Indeed, the blockchain press releases are effective in helping people learn more about this development in the digital economy industry. However, numerous beginners in this technology are quite unfamiliar with the whole concept of blockchain technology. If you are one of these individuals, here is a brief summary to help you learn more about it.
The context of blockchain talks about digital information called as the block, which is stored in the public database or the chain.
The blocks on the blockchain are pieces of digital information divided into three parts.
- Digital information or blocks that store data about transactions including the date, time and amount.
- Blocks that stores information about the individuals participating the transactions. Instead of using your record name, you are identified through your digital signature also known as a username.
- Blocks that stores information that distinguishes one user account from another. Each block features a unique code called hash. This code helps in separating your account from another block.
How does it Work?
All new data on a block is added in the blockchain. Thus, a blockchain is like a series of blocks that contains unique information.
Verification is required to add new information on a block. If the user identifies the new block as true, the blockchain becomes publicly available. For example, if you are using Bitcoin, you can access the transaction data along with the other information.
Newbies in cryptocurrency always ask whether blockchain technology offers security and protection to users. On the other hand, some individuals doubt this technology due to the security issues according to some cryptocurrency users.
But the question is, can you trust blockchain technology in cryptocurrency?
Manipulating a blockchain is impossible. Here are the reasons why this technology is 100 percent secured.
- Each block contains a unique code that changes every time new information is added to the chain.
- Blockchains are continuously updated. It indicates that there is no chance that a person can hack a system.
- Each computer has a copy of the blockchain network. Thus, there are at least thousands of copies of the same blockchain, making impossible to manipulate a data on a network.
In a nutshell, a blockchain technology protects the identity of a cryptocurrency user. It ensures that the user is safe from identity theft, hacks, online scams, and similar cybercrimes.
Albeit blockchain technology is useful to private users, however, it does suggest problems to crypto-entrepreneur. It offers several challenges such as failing projects, poor regulation and the fact that blockchains are fairly new. Nonetheless, it is up to you to decide whether blockchain technology is worth using.
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