Blockchain is a chain of database blocks distributed between peer nodes.
The Blockchain technology was first described in 2008 by a developer Satoshi Nakamoto, who invented it for his Bitcoin cryptocurrency. This technology doesn’t require a single server for managing processes.
Blocks line up in strict sequence. They contain information about the previous “brick”, transaction data inside the system and are sealed with a complex cryptographic key. The database formed by the blocks is constantly updated, but it is impossible to delete information from it.
The peculiarity of the blockchain is its infinity. Data is stored on user devices and continuously updated. Blockchain can be compared to Torrent. All manipulations are carried out directly between the network participants, without intermediaries.
How does Blockchain function?
“The Internet of values” is the alternative name for the Blockchain technology. The information placed in the system becomes instantly available to all network members. The block chains made it possible to send valuables to any place in the world. You do not need to confirm your identity for that or pay high commission rates. You just need to have a private key.
Speaking of Bitcoin, a private key is necessary to access certain amount of cryptocurrency. Thus, the blockchain replaces the usual banking system. And its safety indicators are many times better.
Only the owner of the key can make changes to the chain blocks. All unconfirmed operations are immediately rejected. The registry stores data about each transaction, allowing you to track manipulations with blocks.
Blockchain made a real revolution in the world of digital technologies. It realized the ideas of openness and equality of all network participants. The strong sides of this technology:
Decentralization. Each particular system member supports its functioning and is a server. Blockchain does not have a single command module that could forcefully cancel or block the transaction.
Transparency. Data on each transaction is available to all system members at any time. Information cannot be deleted or changed. Theoretically, it will be stored forever.
Unlimitedness. According to calculations, the blockchain can be supplemented by blocks indefinitely. There is no boundary information amount by now.
Safety. Only legitimate operations are recorded in the registry. It is extremely difficult to hack the chain of blocks. It requires a lot of resources, but does not necessarily guarantee that the attack will be successful.
Blockchain was created specially for Bitcoin, but the technology turned out to be so successful, that it was adopted by the developers of other cryptocurrencies. A qualitative change in it was made by Vitalik Buterin, the creator of Ethereum. He managed to implement a peer-to-peer network that performs programmed algorithms. Their implementation is carried out by creating favorable, previously written conditions. Such algorithms are called Ethereum smart contracts.
The Ascribe platform adopted the Blockchain technology and created a complementary database that contains information about copyrights to works of art. Blockchain may well be a digital equivalent of identity cards. There are several registered start-ups mastering these possibilities of successive chains of blocks.