Blockchain Technology

Decentralization

Blockchain will not be a panacea for solving social problems. No tool or technology can, but its adoption across societies may offset some of Ito’s concerns about the modest direction of Silicon Valley technology evangelism and its over-reliance on artificial intelligence. First, Silicon Valley’s financial monopoly on all data and assets contained in a Web 2.0 environment can be redistributed to individual Web 3.0 users. Second, the social decentralization promoted by blockchain can redistribute and democratize the way people participate and work together. Third, the blockchain is not controlled by a central authority, but by the entire network of participants. The decision-making mechanism of a large number of people is more flexible.

To understand blockchain, it helps to look at the context of Bitcoin’s application. Like a database, Bitcoin requires a number of computers to store its blockchain. In Bitcoin usage, the blockchain is just a specific type of database that is used to store every Bitcoin transaction. In bitcoin usage, it is not like most database, these computers are not all under one roof. Each computer or group of computers is managed by a unique person or group of individuals.

Imagine a company has a server with 10,000 computers and a database server containing the account information of all its customers. The company has a warehouse that holds all these computers in a room and has complete control over each computer and all the information. Like above example, Bitcoin is made up of thousands of computers, but each computer with its own blockchain is in a different geographic location, and all of them are managed by different people. The computers that make up this Bitcoin network are called nodes.

In this model, the Bitcoin blockchain is used in a decentralized manner. However, there are centralized blockchains where the computers that make up your network are owned and managed by a single entity.

With Bitcoin, data is a complete history of all Bitcoin transactions. If the data error on one node, you can use thousands of other nodes as a benchmark to fix it. In this way, no node on the network can change the information stored on it. Therefore, the transaction history in any block that is the Bitcoin blockchain cannot be changed.

When a user interferes with Bitcoin transaction logs, all other nodes are redirected to each other and easily identify nodes with false information. With Bitcoin, this information is a list of transactions, but blockchain can also store various types of information, such as legal contracts, status displays, or company product inventory.

To make it work, most of the computing power of a decentralized network must agree to these changes. This will ensure that any changes made are in the best interests of the majority of people.

transparency

Due to the decentralized nature of the Bitcoin blockchain, all transactions can be viewed transparently, with private nodes or with a blockchain browser, so everyone can view transactions in real time. Each node has its own copy of the circuit which is updated as new blocks are confirmed and added. This means you can track Bitcoin anytime, anywhere if you want.

For example, exchanges have been hacked in the past and those who have bitcoins on the exchange have lost everything. Although hackers can be completely anonymous, the bitcoins they withdraw are easy to track. If the bitcoins stolen in some of these hacking attacks are transferred or spent somewhere, this is known.

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