Blockchain also referred to as Distributed Ledger Technology (DLT), is the technology which can make the past of digital assets not to be altered and to be transparent with the help and usage of decentralization and cryptographic hashing. Google Doc is an analogue for the technology being talked about. It is a revolutionary technology which helps to reduce risk factors, throw out the frauds and ensures transparency in the uses. There are three main concepts in the technology which includes blocks, nodes and miners.
Multiple numbers of blocks are available in the chain which is again categorized as data, nonce and hash. When the first block in the chain has generated a nonce will obtain a cryptographic hash, where the data given in the block is signed and tied forever to the once and has only if they are mined.
By the process of mining, new blocks are created by the blockchain element miners. Various software’s are used to find the complex nonce which generates the hash. Each block in the chain has unique nonce and hash. Once a block is being mined, the changes generated are accepted by all the nodes in the network.
Nodes in the chain can be any type of electronic device which has the feature of maintaining the copies of the blockchain which makes the network to function. The networks should approve the mined blocks algorithmically; hence the chain can be trusted and verified. Three types of blockchains are private, public and hybrid.
The Blockchain brought a lot of merits in various fields which could increase the security in the environments which was not suitable to trust. But the decentralized nature of the chain caused some cons to the technology which includes the limited efficiency and more requirements in the storages.
The advantages include the nature of being distributed, stability, secure etc. the data of chain are stored several devices on distributed networks which makes the system and data highly resistant from the failures and attacks. When the blocks get confirmed, they are stable enough so that it is difficult to make changes or removes the details. This feature helps to store financial records and other important data. The system reduces the risk of trusting a particular association which ensures the reduction in the overall costs too.
The demerits include the chances of attacks up to 51 % which happens on managing network hashing power. The data modification is also very difficult in technology even though stability is an advantage. Private Keys provided for the users have to be kept securely less it may lead to various losses.
There are several applications being possible with blockchain technology. They include Crypto Currencies, Smart Contracts, Financial Services, Video Games, Supply Chains, and Hyper Ledger etc.
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