Blockchain is growing in importance. It is steadily transforming the financial relationships between people and businesses globally. Increasingly organizations have to explore what this revolutionary technology will mean for their business.
Just last year, a record-breaking $1 billion so far has been pumped into Bitcoin and blockchain-related tech startups. People are calling it as big an invention as the internet.
In this article, I will try to explain
- What is Blockchain?
- How Blockchain works?
- What are the benefits of Blockchain?
- And other basic doubts on Blockchain
What is Blockchain?
Blockchain is a vast, globally distributed ledger where anyone, anywhere can move, store and manage any kind of asset, from money and securities to intellectual property and votes
In other words:The Blockchain is a decentralized ledger of all transactions across a peer-to-peer network. Using this technology, participants can confirm transactions without the need for a central certifying authority.
Potential applications include fund transfers, settling trades, voting and many other uses.
How Blockchain works?Note:
Cryptocurrency is a medium of exchange, created and stored electronically in the blockchain, using encryption techniques to control the creation of monetary units and to verify the transfer of funds. Bitcoin is the best example.
Is blockchain a hype?
Answer is NO!
People are comparing Blockchain to the emerging internet in 1993. Blockchain is growing very fast.
Many organizations are already exploring the possibilities of the Blockchain, although primarily still in the Financial Services industry. Just last year, a record-breaking $1 billion so far has been pumped into Bitcoin and blockchain-related tech startups.
Four of the biggest global banks, led by Swiss bank UBS, have developed a "Utility Settlement Coin" (USC), which is the digital counterpart of each of the major currencies backed by central banks. Their objective is to develop a settlement system that processes transactions in (near) real-time instead of days. A third example is Australia Post, who have released plans for developing a blockchain-based e-voting system for the state of Victoria.
The possibilities of the Blockchain are enormous and it seems that almost any industry that deals with some sort of transaction, which would mean any industry, can and will be disrupted by the Blockchain. As a result, it is likely that many of these industries will face job losses since intermediaries will be needed a lot less.
What are the potential applications of Blockchain?
What are the benefits of Blockchain?
The most significant and immediate benefit of the blockchain is that it can eliminate inefficiencies in existing financial markets and drive faster, lower-cost transactions.
The blockchain offers trust for the user, eliminating the need for the intermediary and mitigating the risk of human error with complete automation.
Below are major benefits of Blockchain.Secure Digital Voting
The greatest barrier to getting electoral processes online, according to its detractors, is security. Using blockchain, a voter could check that her or his vote was successfully transmitted while remaining anonymous to the rest of the world.
In 2014, Liberal Alliance, a political party in Denmark, became the first organization to use blockchain to vote.Decentralized Exchange
Traditionally, exchanges require an intermediary such as a broker/clearing housing to match buyers and sellers. With the blockchain, the need for this 3rd party arbiter is scraped.Safe and Secure Identity Verification
Blockchain based authentication systems are based on irrefutable identity verification using digital signatures based on public key cryptography. In blockchain identity authentication, the only check performed is whether or not the transaction was signed by the correct private key.