Why Blockchain Technology is considered as a Technology of Future?

Blockchain Technology

Blockchain Technology

The Blockchain Technology is considered to be one of the best things that happened to the world of the internet since its inception. Blockchain as suggested by its name stores transaction and valuable data in blocks that are interconnected to each other through networks of the chain. The size of Blockchain is directly proportional to the size of data or transactions it holds. The Blockchain size advances with the number of transactions increase. Blocks are a medium to store and confirm the sequence of the transaction.

Thereafter, these blocks are logged into the Blockchain which is being ruled by the laws mutually agreed by all the participants. There are several blocks in a Blockchain that contains hash which contains batches of all the recent transaction and hash of the previous block. Often it is being asked that why previous block hash information is being passed to the next block, the reason behind this is to keep all the blocks together and not let the information of blocks getting altered or a new block is being inserted between the two blocks.

This method is hugely effective as it ensures the security of the Blockchain. This method constitutes Blockchain into a secure digital transaction medium and renders it immutability. Blockchain maintains the record of all transactions successfully. All transaction is then successfully logged in the Blockchain. However, to clear the air, Blockchain is not the alternative of messaging, database, business processes or transaction processing. It is only used to keep the valid proof of all online transactions. The Blockchain advantageous is not confined up to recording the online transactions, besides this, it has numerous other benefits which are discussed in detail below:

Apart from benevolent for all sorts of online transactions due to cryptocurrency; Blockchain is considered to be the ideal model for business transactions. Unlike, the Blockchain that relies entirely on the interchange of the cryptocurrencies with the unknown public audience, a Blockchain for business is quite secured. It is a highly secured network with known identities. Moreover, cryptocurrency is not required in this case.

Blockchain has entirely revolutionized the business world. This new model is easy to access and quite useful. However, to know how Blockchain works for a business in an effective manner, go through the below-mentioned points:-

Shared Ledger

Ledgers have an integral part of the business. It has been used in the business world for centuries. Apparently, Blockchain also has a ledger, but it is different from the regular one. A Blockchain business ledger is a distributive ledger that can be accessed by everyone involved in the Blockchain. A shared ledger comprises of details of every transaction. Moreover, all participants have right to access each transaction. They all have been given duplicate copies of the public. The attributes of the shared ledger are as follows:

  • A shared ledger is a single source of truth containing all the transactions across the business network.
  • Each participant has the copy of the ledger.
  • Shared ledger is licensed which means that participants are allowed to view only those transactions which they are authorized to view.

Blockchain can be of two types permissioned and permissionless.

A. Permissioned Blockchain

Talking about the permissioned Blockchain, this type of Blockchain is highly secured. Each participant has allotted a unique identity that regulates the activities of participants on the network and strengthens the security of the network. This is an immensely powerful way to maintain and inhibit the participants to violate the Blockchain policies. With the ability to control the actions of network participants, an organizer needs to ensure the data protection and meet the rules. Permissioned Blockchain maintains the data consistency which is an integral part of the entire Blockchain network. The ability to confine the access of the participants to view the transaction details, a participant can determine who can view his/her transaction detail. This gives authority to the participant in the network to allow only some participants to view detail of his/her transactions. Similarly, some participants are allowed to view only a specific number of transactions; on the other hand, it allows auditors more power to view all records.

To make you better understand this part, let’s take an example – suppose A and B have indulged into the transaction on the Blockchain. A transfer of an asset to B, both A and B can see the transaction detail. But, C means another participant will only see that A and B transacted but he/she won’t see the details. It hides the transaction detail information from others. However, a participant who is appointed as auditor will have right to view the transaction details of any of the parties involved.

The Blockchain is an extremely secure and fraud resistance because a digital certificate is being issued to run a Blockchain by a trusted agency. The Blockchain network is secure because it will be run after a digital certificate is being issued by a trusted agency.

B. Permissionless Blockchain

A permissionless Blockchain is an open Blockchain where all participants are allowed to take part in the network. They all can carry out transactions without any permission. Suppose, A & B are indulged in any transaction where the third person say C will be able to see the transaction occurring between them. However, the third person would not be allowed to see the details of the transaction. Bitcoin is considered to be this kind of Blockchain where all participants are allowed to download the ledger on their system and they all can see different transactions. The Permissionless Blockchain is a secure network and one should not worry about the security of the system as it is an extremely secure network.