While going through technology and financial news, you may have observed “blockchain” and “cryptocurrency” popping out. Maybe you also read up the concept, but still unsure about it and its principles. Blockchain technology is not much different from the things you already happen around. It is a wave of future that backed Bitcoin innovation.
Blockchain technology enables people to create entries into a public record just as Wikipedia. Users can then amend or update the record. The record/ledger is not a property/product of a single person hence, allowing all users to control it. Blockchain technology is truly decentralized, fairer, and more transparent than any public ledger.
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So, how does blockchain Works?
With no new technology, but a combination of technologies, blockchain is a revolutionizing technology – a step towards the transparent and decentralized world. It comprises of private cryptographic keys, distributed ledger, servers, clients, blocks, and identities.
Blockchain is a systematic set of data that is processed through mining, where each block get identified by a hash and timestamp. By creating and assigning crypto keys using cryptography rules, the node initiates a transaction.
But, what is blokchain transaction?
By transaction, we are not talking about your financial transaction. But, every action took over a blockchain platform is known as transactions. It can be a transfer of values, relevant rules addresses, and sources between users and network. It may include transfer of money too.
How transfer takes place?
The process is so simple. Validators/nodes verify each transaction then to include it in a block to propagate it onto the network. As the block gets into the decentralized ledger, it then connects itself with other blocks using cryptography rules. Once added, data becomes immutable or tamper-proof.
Whereas, block in a blockchain is like a unit/page of a ledger containing all information about timestamp, digital signature, and transaction data. A consensus has to achieve for validation, to verify each transaction for new block generation.
So, the above mentioned is a summary of basic blockchain terms and its operation. To learn more about blockchain technology and its implementation, subscribe us.