Is blockchain really safe?

If you think about blockchain technology, your first connotation probably is Bitcoin. Nothing unusual. Bitcoin and other cryptocurrencies were the first implementations of blockchain technology.

Block-chain?

In the following paragraphs, I’ll try to explain what is blockchain and how does it work. Try to imagine a distributed ledger used to register transactions. What is important, all the transactions are saved, so that results in creating a chain. But blockchain isn’t only full of information about transactions. It also contains smart contracts as a code. Each one of the blocks is created approximately every 10 minutes. Blocks are filled with: block header, size of a block, number of transactions and transactions themselves. Because of transcription of blocks, there isn’t a chance to double spend Bitcoins. What’s more, blockchain technology is characterized by publicity of all executed transactions. You can also check old transactions in explorer blocks. If you make a mistake, there is no turning back as well. All the transactions saved in blocks are unconvertible.



block header

Why someone can’t imitate a block?

Hash of a block is a crucial element which guarantees uniqueness of transactions. Operation leads to creating a new hash is called proof of work. In easier worlds, this is how every block is signed. None of the blocks in blockchain technology can be pulled out of the chain. Why? Every block header contains a hash of the previous block. So if someone tried to change one piece of block, it would affect on all blocks. Hackers with that knowledge can think about imitating a chosen block, but it’s either impossible. Such an operation would require enormous computing power that’s why all the transactions in blocks can’t be changed.

Where can blockchain be used?

  • Internet of Things - tracking condition, history, exchange opportunities
  • Voting system - scattered, automatic counting votes with full history
  • Payments or loans Peer-to-Peer - global network of money order without any agents
  • Software studios
  • Transport - renting rides, private drivers
  • Identity and verification - digital signatures, authorization
  • Smart contacts - automatically concluded and executed contracts that no one control but with high level of trust
  • … and much, much more. Every day new companies are discovering advantages of using blockchain technology in their structures.

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