What is Block Chain?
Block chain as the word suggests refers to a chain of highly secure blocks of information an
data arranged in the form of a chain creating a database or a ledger of all the transactions
taking place in the world via bit coins. This word and this system of bit coins gained popularity quite recently in the world of information technology but what does it offer that other modes of currency cannot? I Well to understand that first it is important to know the difference between a block chain and bit coins. To put it in simple words a block chain provides us with a method to bring multiple non-trustable parties to agree to a single point at once while also allowing each and every single party to add some information to chain by acting their respective signatures. Since the signatures are hic in nature they cannot be just forged easily which helps us to be independent and not rely on other people for authentication since the block chain is transparent mechanism which cannot be tricked easily hence making everything visible and at the same time keeping the user secure.
A block chain is said to be the backbone of the complete bit coin system and is responsible for keeping records of an bit coin transactions taking place from the first transaction ever to the last one. bitcoin being payment system indented by an anonymous hat working under the name of Satoshi Nakamoto came into endetence in 2008 and was released as an opensource software 2009 allowing user to make transactions directly without the use of an intermediary it is a cryptocurrency and is stored electronically in our computer device. It follows a very interesting approach of mining for bit coins which means running sophisticate software on machines in order to discover and verily aw bit coin since they cannot be printed. Therefore miners earn money every time they discovering a bitcoin transaction. A total 21 million bitcoins exist in the world out of which 155 million are currently in circulation. This is done so as to prevent information. Block chain maintains a truth table for the transactions taking place using these 15.5 million bit coins such that once a log has been entered by a party along with its signature the write permission is given to only that particular party and all the other interested parties are only provided read only privileges at that instant. This makes the mechanism secure as well as transparent at the same time. Using block chains is not just for transfer of money but can help transfer almost everything from property rights to stocks. In the financial markets every transaction needs to be cleared by a middle man which is a costly affair but now this can be avoided by replacing it with a faster, cheaper and a more accurate alternative. Moreover bit
coin has always been associated with the dark web transactions and dealing causing its image to sink whereas block chains come with a cleaner reputation so much so that even banks are willing to make use of it and companies such as Goldman Sachs, JP Morgan, Visa, Citi and NASDAQ have also agreed to be clients to these services. This is not only because of a more decent reputation but also because block chains can be made of two types.
1. Private Block chain
2. Public Block chain
Every block chain has a large number of connect-cd computers for exchange of transactions and keeping the records in the ledger. A private blockchain can be used by banks since
are under the protection of very secure firewalls which allow access only to the computers present on the same network meaning nobody else can access the block chain or make changes in it unless the permission is granted by allowing connection to the decided network. Here the blockchain can be exposed to the world but the mining privileges of the users can be controlled. Block chains can be the future of banking since these allow fast and quick transactions of large volumes of money with almost no processing times and form public records which are tamper proof and cannot be erased from existence. Blockchains are better suited for today's technology oriented world rather than traditional banking practices by making use of in mining and keeping the users hooked for life.