With the advent of Bitcoin in 2009, many people have entered the cryptocurrency market, and we are witnessing the increasing expansion of this field. However, there are now more than 1,500 different cryptocurrencies. However, the most important concept discussed in this area is Blockchain technology, which is the cause of this huge change. In fact, Bitcoin, Ethereum, and other cryptocurrencies all work on this technology.
If you are also a cryptocurrency enthusiast, you have probably come across the word Blockchain. In this article, we try to give a general expression of this common concept in the field of currency cryptography.
What is the Blockchain?
In general, a “Blockchain” is a chain structure of blocks that allows users to receive and send cryptocurrencies such as Bitcoin, Ethereum, and so on. However, Blockchain technology is much larger than a payment system. In fact, one of the salient features of the Blockchain is that it is not controlled by any individual, organization, or body, and its transactions are verified by the users of the network themselves. In fact, this very important feature of the Blockchain network is called “decentralized”.
In addition, Blockchain technology has other outstanding features such as transparency, high speed, and security. Therefore, the Blockchain, given its size, does not only include financial transactions, but also has the ability to be adapted and used in all industries.
Because Blockchain is a decentralized network, all people on it have the same access to information, which means that once a transaction is approved and completed, it will be on the Blockchain and everyone will be able to see it. In fact, Blockchain has the same function as a general ledger, where all transactions are recorded by the accountant, except that Blockchains such as Bitcoin and Ethereum Blockchain are public and every user can view their transaction information.
Blockchain, on the other hand, is like a list of transaction records or blocks that are encrypted, and each block contains a hash or encrypted code from the previous block and its transaction information.
In addition, Blockchain is designed to resist correction of information, and it is not possible to change or delete information in it, unless this change is approved by the majority of users of that network. Blockchain is, in fact, a distributed, “open source” general ledger whose data is recorded over the Internet by peer-to-peer networks; In fact, this network is able to record transactions between the parties in a valid and permanent manner.
Apart from these, the data recorded on a Blockchain network can be in any form such as money transfer, a financial transaction, the identity of individuals, contracts, or agreements between individuals or companies, and so on.
However, performing such processes requires approval and validation, and this is done by miners with powerful hardware. In fact, when these individuals (miners) reach an agreement or consensus on the registration and storage of information on the Blockchain, this transaction or information is immediately recorded on the network and this process is called the “Consensus Algorithm”.
Note that Blockchain technology is not a company, organization, or even a software, but it is a new way to record and document data over the Internet. On the other hand, this technology can be used in the construction and development of applications based on Blockchain, such as social networks, messengers, games, exchange offices, etc.
Now that we are talking about using the Blockchain in real life, it is not bad to see what the main uses of the Blockchain network are. And for deep information about blockchain visit hoseinifinance.com.
Blockchain applications
As mentioned earlier, Bitcoin and other cryptocurrencies that have a decentralized function are among the most prominent and successful applications of Blockchain technology. Bitcoin, for example, has lost the ability to cheat, spend money twice, and return transactions by Bitcoin technology. But this technology has the potential to be used in other areas besides cryptocurrencies. In fact, it is possible to use Blockchain technology wherever there is a need for space to store data and eliminate the need for a trusted interface.
On the other hand, by replacing centralized servers with decentralized Blockchain, individuals, companies, organizations, organizations and governments can also benefit from Blockchain benefits such as security, transparency, and speed. Therefore, in the following, we intend to point out the most important applications of this new technology.
Overseas payments
Overseas transfers have always been a trillion-dollar business, and banks are forced to make overseas payments at high costs on a daily basis. On the other hand, these transfers are often done through an intermediary called Swift or the international community of interbank financial communications. In fact, this is because banks cannot transfer money directly to foreign banks and are forced to use these intermediaries. However, with Blockchain technology, banks can work seamlessly with each other, which means that there will be no intermediary between the two banks, and as a result, overseas transactions do not require several working days and high fees.
Supply chain
The supply chain refers to how a product moves from the starting point (production) to the end point (reaching the consumer). For example, consider making a natural juice. The supply chain starts from the place of fruit growth and ends with the transfer of fruits to the factory, preparation of juice in the factory, transfer to the warehouse, transfer to the supermarket, and finally purchase and consumption by the customer. In fact, it is very difficult to examine each of these parts in detail, because each part of this supply chain has its own centralized system. Nevertheless, with Blockchain technology, it will be possible for everyone to examine the entire supply chain process, thereby making the whole process more efficient, transparent, and secure.
Insurance
The insurance industry as a whole covers all aspects of our lives. In fact, anything like home, car, land, livestock, health, travel, etc. can be insured. But the problem now is that the industry is being run by a third party or company, and that has made it very expensive to do so, and when an insured person or company claims damages, the process can be very lengthy. However, Blockchain technology allows individuals and companies to be insured without the need for a third party.
Election
Most likely, we have all heard debates about electoral fraud around the world, and we have heard, for example, that the central network of the US electoral system has been hacked. It can be claimed that this happens in many countries. However, with Blockchain technology, it can be said that this problem will be solved easily. In fact, just like transactions on the Blockchain network and that all members of the network are able to see the transaction, it is impossible for different political parties to manipulate the vote.
Concluding remarks
With the increasing development of cryptocurrencies and the widespread acceptance of people in this field, the use of various potentials in this field has led to a lot of attention to address the fundamental issues in the field of cryptocurrencies. Hence, one of the concepts that is actually one of the most fundamental issues in the field of currency cryptography is the concept of Blockchain technology. In this article, we tried to define the general concept of this new technology and examine its most important applications in human life.