How do blockchains and Cryptocurrency work?

Introduction: Blockchain is a revolutionary technology that records information in such a way that makes it impossible to crack. Cheat or hack the system. A blockchain is a digital journal of transactions that are distributed across the entire network of computer systems on the blockchain.

Who invented Blockchain?

Around 10 years ago, blockchain technology was adapted by an unknown creator recognized by the pseudonym of Satoshi Nakamoto. He implemented this technology to develop the cryptocurrency called Bitcoin. The blockchain is superbly secure that once the data has been stored in a place, it will not be changed by anyone.

What is cryptocurrency?

Cryptocurrency is a digital payment or form of digital cash maintained by a wide range of computer networks that uses cryptography to authenticate transactions. It is not yet backed or regulated by governments like traditional currencies. The operation of cryptocurrencies depends upon blockchain technology.

How do they work together?

Step by step functions of Blockchain and Cryptocurrencies:

· A transaction is requested and authenticated through algorithms.

· A block representing that transaction is established.

· The block is sent to every participant in the network.

· Participants authenticate the transaction that earns them an authentication reward, typically in cryptocurrency.

· The new block is added to the existing blockchains.

· This update is distributed amongst the networks and completes transactions.

Is blockchain safe?

Blockchain being a digitally equipped journal that contains transactions in a chronologically organized manner. This arrangement creates privacy and helps the network from being manipulated by an individual authority. It is publicly available so anyone who is a part of the network can see and authenticate the transactions.

Why blockchain and cryptocurrency are so much trending?

In the past, there have been so many attempts to create a digital currency, but they all were unsuccessful due to trust issues. Bitcoin was designed to solve this problem by using a specific type of database called a blockchain. This contains normal databases like SQL databases. Blockchain is different because nobody is in charge directly or indirectly. It is completely regulated by the people who are using it.

Key Takeaways:

Blockchain is an evolutionary kind of database.

It is different from typical databases in the way it records information.

Blockchains record data in blocks that are then chained together.

All the new transactions are recorded in chronological order which protects them from manipulation.

Ledger formatting is the most common way of storing information on a blockchain. But it has other ways too.

The records, once recorded on the blockchain, are irreversible.