What is a blockchain?

Blockchain is a concept that has been mentioned a lot in recent social media and it is referred to as the next generation 'The Next Big Things'.

Blockchain is a concept that has been mentioned a lot in recent social media and it is referred to as "the next big things" next generation. So what is really the blockchain and how does it apply to our lives?

Blockchain is a hot topic on today's global forums. This is the technology behind electronic currencies like Bitcoin. Some people worry that Bitcoin bubbles may crash at any time and affect the trading markets worldwide. However, many people believe that technology behind it is a breakthrough and will quickly become a strong foundation in the future.

So what is Blockchain actually? What areas of life can it be applied to and why is it concerned?

Learn about Blockchain

Picture 1 of What is a blockchain?

Picture 1 of What is a blockchain?

The blocks contain information about the initialization time and are associated with the previous block.

By definition from Wikipedia and many monetary forums, "Blockchain technology - is a ledger (originally named block chain ) that records the balance and history of all accounts involved. Your transaction chain ".

Each block contains information in a blockchain system commonly called a "block" . The blocks contain information about the initialization time and are associated with the previous block, along with a time code and transaction data. When the data is accepted by the network, there is no way to change it. Therefore, it can be said that Blockchain was born to prevent fraud and change data in transactions.

You may come here to imagine what Blockchain is, but to better understand, you need to pay attention to some of the following issues:

Why is this technology called Blockchain?

The Bitcoin network arranges transactions by grouping them into groups called blocks , each containing a certain number of transactions and a link to the previous block. As time goes on, transactions increase, blocks also increase, they link together and are organized into chains, from which the system is formed with the name Blockchain.

Picture 2 of What is a blockchain?

Picture 2 of What is a blockchain?

As time goes on, the transactions increase, the blocks also increase.

According to experts, Blockchain is a combination of 3 types of technology:

  • Cryptography : blockchain technology has used public key and hash function to ensure transparency and privacy for transactions.
  • Peer-to-peer network: Each node in the network is treated as a client and also a server for storing application copies.

( Note : peer-to-peer network), also known as peer network, is a computer network in which network activity relies heavily on computing power and bandwidth of the network. The machine joins rather than focusing on a small number of central servers like regular networks - According to Wikipedia.

  • Game theory: All nodes participating in the system must comply with the consensus game rules (PoW protocol, PoS .).

From a business perspective, blockchain can be considered an accounting ledger or a data structure containing assets, documenting the wealth history of everyone in a peer-to-peer network.

From a technical perspective, blockchain is a way to store history of asset transactions.

In a social perspective, blockchain helps establish trust by agreeing rules among members in a hierarchy.

How does blockchain work?

Blockchain technology allows making valuable transactions without believing or evidence. Imagine me and you will make a bet, I bet 100 USD for Liverpool to win the upcoming Champions League final and you think Liverpool will lose. In the past, this bet could be done in two ways: trusting each other (meaning that if you only have the match result, you or you will automatically collect money for the winner) or make a contract. between the two parties (this contract is legally binding, but if one party fails to comply, the other party has to pay additional legal fees to file court proceedings).

Picture 3 of What is a blockchain?

Picture 3 of What is a blockchain?

Blockchain operation.

Both trust and contract are not optimal solutions. Therefore, the blockchain technology was launched to provide us with a choice of third, safe and cheap transactions.

Blockchain allows writing a few lines of code to create a program that can run on this platform. After that, you and I will send your 100 USD into this program. The program will hold 200 USD and check the result of the C1 Cup final after it finishes. When the winning team is determined, the losing team will automatically pass the winner the entire amount of the bet. Each party can check the logic contract, and since it is running on the blockchain, it cannot be changed or stopped. Of course, few people even write an application just to bet $ 100, but imagine bigger deals like real estate sales, buying cars . then the blockchain payment method becomes convenient and how safe

The most well-known and discussed application of blockchain technology is Bitcoin. A digital currency can be used to exchange products and services, like the US dollar (USD), Euro (EUR) and many other currencies of other countries.

In addition to Bitcoin, blockchain can also be applied to smart, economic-sharing contracts, expanding the capital call market, managing and examining supply chains .