Many people think of Block Chain as the technology that powers Bitcoin. While powering the Bitcoin was its original purpose, Block Chain is capable of much more. Despite the sound of the word, there is not just one “Blockchain”. The term Blockchain is shorthand for a whole suite of distributed ledger technologies that can be programmed to record and track anything of value, from financial transactions, to medical records, or even land titles.
While we already have processes to track data, let’s see how block chain technology stands to revolutionize the way we interact with each other.
The Way it Tracks and Stores Data:
Block Chain stores information in batches, called blocks that are inked together in a chronological fashion to form a continuous line: metaphorically, a chain of blocks. If you make a change to the information recorded in a particular block, you don’t rewrite it, instead the change is stored in a new block showing that x changed to y at a particular date and time.
Sounds familiar? That’s because block chain is based on the centuries-old method of general financial ledger. It’s a non-destructive way to track data changes over time. Unlike the age-old ledger method, originally a book, then a database file stored on a single system, Block Chain was designed to be decentralized and distributed across a large network of computers. The decentralization of information reduces the ability for data tampering and brings us to the second factor that makes Block Chain unique.
Block Chain Creates Trust in the Data:
Before a block can be added to the chain, a few things have to happen. First, a cryptographic puzzle must be solved, and it will create the block. The computer that solves the puzzle, shares the solution to all of the other computers on the network, which is called proof-of-work. The network will then verify this proof-of-work and, if correct, the block will be added to the chain.
The combination of these complex math puzzles and verification by many computers ensures that we can trust each and every block on the chain. Because that’s what network does, it creates the trust building for us, and we now have opportunity to interact directly with our data in real-time. That brings us to the third reason why the Block Chain technology is such a game changer – no more intermediaries.
No More Intermediaries:
Currently, when doing business with one another, we don’t show the other person our financial or business records. Instead, we rely on trusted intermediaries, such as a bank or lawyer, to view our records, and keep that information confidential. These intermediaries build trust between the parties and are able to verify an agreement. This approach limits exposure and risk, but it adds another step to the exchange, which means, more time and money spent. Block Chain cuts the need of the middle man, because, all blocks added to the chain have been verified to be true and can’t be tampered with. This would save considerably amount of time and money by cutting off the middle.
Peer-to-Peer interaction with our data can revolutionize the way we access, verify and transact with one another. Because block chain is a type of technology and not a single network, it can be implemented in many different ways. Some block chains can be completely public and be open to everyone to view and access, others can be closed to a select group of authorized users. The combination of all these factors, the de-centralizing of the data, building trust in the data, and allowing us to interact directly with one-another and the data, that gives block chain technology a great potential.
Block-Chain has a bright future and it can revolutionize the way we make agreements with each other by cutting the middle man, thanks to the Centre of International Governance Innovation and our developers at Vizah we were able to provide this amazing article about how block chain may change the way we deal with each other.
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