What is the blockchain? And the future of this game changing technology.
Have you ever wondered how digital money like Bitcoin works? Or how people can send money over the internet without using a bank?
The special technology that makes this possible is called the blockchain. Let me explain what this is and why it's so revolutionary!
Imagine a BIG, Virtual Ledger At its core, a blockchain is like a giant virtual ledger book that records all transactions happening on a network. This ledger is duplicated across thousands and thousands of computers around the world instead of existing in just one place.
Every ten minutes or so, transactions are batched together into a "block" kind of like how pages get filled up in a ledger book. Once a block is filled with transaction data, it gets a unique code called a "hash" that identifies that block kind of like a fingerprint.
The block is then added to the blockchain which is like one massive chain of blocks connected together in perfect order using cryptography (super advanced codes).
The blocks get chained together in a way where each new block contains information about the previous block. It's like connecting Lego blocks together to form an expanding chain.
A Decentralized & Unchangeable Record Here's the amazing thing about blockchains they are totally decentralized across a gigantic network of computers.
That means the transaction records are not stored in any single location like a traditional bank database. Instead, the entire blockchain ledger is spread out and copied across loads of computers around the world.
If someone tried to go in and change data in one of the blocks, it would be immediately rejected because that block's unique code would no longer match the other blocks in the decentralized chain.
It would be like trying to swap out a Lego block in the middle of a tower it just wouldn't fit correctly with all the other blocks around it.
This makes the blockchain incredibly secure because the data stored can't be changed, hacked, or tampered with.
Thousands of computers are constantly verifying the blockchain at the same time across the world. It would be almost impossible for a hacker to coordinate changing the same data simultaneously across the entire global network of computers.
Blockchains are Transparent & Trustless Another amazing thing about blockchains is that anyone can view and verify the transaction history since it is a totally transparent and public system.
You don't need to rely on a third party like a bank to see the ledger and verify transactions. It's an open and transparent record that everyone in the network has access to.
This also means you don't need to place trust in a single authority like a bank or government to verify transactions. Instead, the decentralized network of computers all follows coded rules about what data gets approved into new blocks. The blockchain technology itself verifies each block without any single third party needed.
From Crypto to Limitless Possibilities The blockchain was first made famous and used as the technology underlying digital cryptocurrencies like Bitcoin. However, the blockchain can be used for recording all sorts of data beyond just financial transactions.
As blockchain grows in the future, we'll likely see it integrated into more and more aspects of our digital lives for securely recording all kinds of data in a transparent and tamper-proof way.
The future of Blockchains!
You've learned that blockchains are awesome super-secure digital ledgers for recording all kinds of data and transactions.
Did you know blockchains could soon be integrated into many different areas of life?
Let me explain some mind blowing examples of where this revolutionary technology may be heading next.
Medical Information Protecting Your Medical Info In the future, blockchains could be used to securely store and share everyone's medical records across different hospitals and doctor's offices. Currently, your health records get kept separately in different systems that don't connect well.
But on the blockchain, your complete medical history from birth could exist as a permanent decentralized record, ensuring your info is accurate and only you control who can access it. Blockchain could also track prescription drugs from manufacturers to pharmacies to prevent counterfeit medications.
The Supply Chain
Have you ever wondered exactly where the food you eat or the products you buy come from? Blockchains will make supply chains way more transparent by recording every step and movement of a product.
Your banana's entire journey from the farm it grew on, through shipping routes and distributors, to the grocery store shelf could all be tracked on an open blockchain. You'd know for sure that what you're buying is authentic and hasn't been tampered with or fake versions mixed in.
Automatic Transactions Thanks to blockchains, the future will have a lot more things happening automatically through pre-programmed smart contracts instead of relying on middle-men like lawyers or banks.
Your electricity or internet bills could automatically get paid every month through blockchains based on terms in a smart contract. Or when a shipping container reaches its final destination, payments could get triggered to go out immediately with no company needing to manually process it.
Digital Ownership New Ways of Digital Ownership Today we buy movies, songs, and digital goods through centralized companies like Apple or Steam that can control accessibility. But with blockchains, you could truly and permanently own digital content.
If you buy a movie, TV show, or software program, your ownership would be recorded permanently on blockchains as a unique code proving it's yours. No company could then restrict your access to the files you rightfully own and paid for.
Voting Security Achievable
One of the most exciting areas blockchains could revolutionize is how we vote in elections. Today's voting systems are vulnerable to hacking and often don't inspire full confidence.
But a secure blockchain voting system would make the entire process of authentication, voting records, counting, and verification transparent and virtually tamper-proof thanks to the decentralized, unalterable nature of blockchains. Your vote would be permanently recorded on the blockchain.
The Possibilities Are Endless! From protecting private personal data and ensuring true digital asset ownership, to bringing trust and transparency to supply chains and automated transactions, blockchains are primed to integrate further into our world.
As this amazing technology continues advancing, you'll likely see blockchains working behind the scenes in new mind-blowing ways across many different sectors including, finance, healthcare, business, government and law.
The blockchain era is just getting started!