It is rare today that an item or idea comes with a title that describes it so well. I want to try and expound on this thing you will see so often in the Crypto world. This thing called BlockChain.
Among these various chains you will recognize one or two you may have used in the past. To hold something secure, or to move something. In a simiar fashion, we use this "Blockchain" technology to move data and then also secure that data. In the world of the internet, Data is King. Who today can say that they are not affected someway by data. And, how does this data affect you. What about the balance on your credit card or your bank account.
What of the data stored in your medical files that your doctor refers to as he looks at your present vs your previous condition. And even more so, the music you listen to is presented to you in a digital form stored or transmitted via a data link.
When in comes to money, you want to be sure the fiat money or the check you took to the bank is secure. You want to have it protected from loss or theft. So, you put your money in the bank. When you come back to retrieve some money, does the bank give you the exact same dollar bills you left with them? Or maybe you wrote a check and got some of your money back from a different location.
That money you just received is not the same money you deposited, but is of the same value and the same kind. This is the normal flow of money. From coin to digital, and back to coins.
From the time you left some money at the bank, or had your paycheck sent to the bank/credit union; that form of value, that money became a digital file on a memory chip in a big computer. And, copies of the file and its data are reproduced as a backup in case the data is lost or corrupted during the transfer/update/download or backup process.
So, what does blockchain have to do with my money? The ledger your money was recorded on at the bank is a centralized ledger. There is a master copy and it is closely guarded. As you move or add money, that ledger is adjusted and changed to reflect the proper balance.
Whether that data is a medical file, a contract, US Dollars,or crypto currency, the blockchain is a ledger that tracks the data and also keeps it secure.
Each transaction or group of transactions are recorded in a block of data. That block is kept secure by a highly advanced cryptographic formula so that it can not be duplicated nor changed. When the ledger needs to be updated, a new data block is added and attached to the chain. And also secured by a complex code.
Now the interesting part of blockchain Technology in not only how secure it is, but it is also that it is public data. If you were to store $10,000 of crypto currency on a block chain, everyone with a computer can see that stored data. ( But not the name of the owner) Also, that data/money cannot be changed unless 1/2 of a cryptological code ( your private key ) is presented to the block chain and then a new block will stored with the upgraded data or balance.
This process is called Distributed Ledger Technology . Thousands upon thousands of copies of this data is distrubuted throughout a huge network and once a large group of the network operators agree the data is correct, it is entered into a new link in the chain and it becomes immutable. ( can not be changed ) This is what makes it secure. Over half of the network computers in the world would have to hack this data chain before it could be broken and changed.
If you enter the world of crypto, you will see many different chains and different uses. Many will do the same job and many can be for a 1 off solution to a supply/logistics chain, a bank loan contract, a medical/drug manufacturing quality process, or more.
See more about this in an article about block chain security. What keeps it secure and why is it public data. To be published soon.
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