What is blockchain?
Blockchain is a chain of blocks (always on guard, your Captain Evidence). We can say a data log with records of all transactions in a given currency (here it is about ours with Bitcoin) that have occurred since its inception. And this journal is constantly updated with a new leaflet (block).
Each new block contains a fresh update to the transaction log. The block is crammed with our bitcoin transfers, it is formed and transmitted to confirm the network, which consists of millions, or perhaps even billions of computers around the world. The network confirms the block and the bitcoins are sent to the destination addresses, and the computers that contributed to the confirmation are rewarded.
This picture is very simplified, a more accurate and detailed description of it can be read here or wait for the next article 🙂
In order to use bitcoin, it is not at all necessary to understand how blockchain works. We all use a computer, but we may not know why he needs a motherboard or how the chip works in a video card. It is enough to have a general idea, so that at the right time if asked, do not face the dirt. If enough people gather (the same geeks), then next time I will describe the blockchain work process in more detail, with pictures and going into all the smallest details. In the meantime, continue.
As an example, I’ll give an electronic diary of a student. It is, in a way, also a data log. Student ratings can only be seen by teachers, parents, and himself. In the blockchain, everything is in the public domain, each transfer can be found on the network, the main thing is to know the unique id (hash) of the transaction, the destination address or the address from where the transfer was made. For each PTS-address you can find the history of all its transfers. Everything is as open as possible.
And if the functionality of electronic diaries allows you to change past grades of students, then blockchain does not. Nobody will change your translation, will not change your balance contrary to mathematics. Everything is as safe and closed as possible from outside influences.
By the way, these electronic school diaries can be kept using blockchain technology!
Why do I need a bitcoin? What are his charms?
- Complete anonymity. You can easily pay for your specific purchases, friend 🙂 No PTS-address is attached to a surname or first name, address and anything else that is usually required in our bank. There is only an electronic signature that you can issue only yourself.
- Funny commissions to transfer any amount of money to anywhere in the world! This is especially beneficial when transferring large funds in comparison with payment systems or bank transfers. It is only necessary for the other side to be able to accept the cue ball.
- Sufficient ease of use. I downloaded the wallet, installed and voila. No commissions when connecting, paid application downloads, etc.
- Decentralization. The data chain (blockchain) is distributed among all network participants, there is no controlling body over this network, all participants have the same rights.
- No servers, therefore – no DDoS attacks, therefore – an extremely high level of security and. Also, a high degree of system security is guaranteed by the complexity of cryptographic keys. No one will steal your bitcoins from the wallet from the outside unless you yourself have made a mistake somewhere. No one will fit into your transfer, will not be able to block it and ask for a source of funds.
- You can trust the blockchain, it is more difficult to close than your bank, but it is completely transparent.
- Decentralization contributes to the high speed of the transaction, since the power of the network, in fact, is the power of a huge number of computers around the world, which can not be compared with any world bank.
- Well, and, of course, most readers are interested in earning on the cue ball against the fiat currency. These are high risks, but extremely hazardous. Due to the high volatility (rate fluctuations), MTC makes good money. I bought Bitcoin -> I kept it on my wallet for a while -> the rate grew -> sold = profit.
- I cannot cancel the transfer. Quite a controversial plus. If the transfer is included in the blockchain, then he will either dial the required number of confirmations and the recipient will receive it, or he will get stuck in the network if you regretted the commission (it can be increased even after the transfer). In this case, it is impossible to return the cue ball.