Imagine a system that cannot be controlled by a single entity, everything that happens in the system is fully transparent, and everything it does is independently recorded by many entities. That is actually how Blockchain Technology works.
Before we continue, I want to clear out a common misconception. Many people think cryptocurrency and blockchain is the same. Cryptocurrency is not the same as Blockchain. Blockchain is a technology that is very good in keeping records accurately and securely. That technology is then used to create Cryptocurrencies.
There are actually thousands of other things where Blockchain technology can be applied that is not related to currencies or money such as Government Election Processes, Anti-Corruption, Proof of ownership, Authentication, etc.
“The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.”
Don & Alex Tapscott, authors Blockchain Revolution (2016)
Process in a Blockchain Transaction
Let’s now go to blockchain applied in cryptocurrencies because that is the most popular use of Blockchain Technology. Every time a person requests a transaction like for example you want to pay someone in BTC by sending it to their BTC Wallet Address, it takes some time for the transaction to be successful because it will still go through a verification process.
Every transaction request needs to be validated several times by many computers. Once the transaction is validated successfully, a new record also known as a block will be added to the blockchain and that’s the time the transaction will be completed. The blocks in the blockchain are permanent and unalterable making it very secure and reliable.
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