What is a blockchain?
“A blockchain is a distributed public ledger that uses cryptography to ensure the record is practically immutable. Satoshi Nakamoto is an anonymous programmer who creates the idea, and it is the technology that makes peer-to-peer Bitcoin transfers possible without the need for financial institutions to verify transactions.”
It is a chain of blocks that contain information. A blockchain can be programmed to record and track any information that has a value from financial transactions to medical records.
“When we say the words “block” and “chain” in this context, we talk about the digital information (the “block”) stored in a public database (the “chain”).“
How does a blockchain work?
Blockchain stores information in batches called blocks that linked together in a chronological order to form a continuous line metaphorically a chain of blocks. If some change happens in a particular block, there is no change in the past block, the change happens on a new block which shows the change and the date.
Before adding a new block to the blockchain, there are some requirements. Miners have to solve a cryptographic puzzle in order to create the block by using their computing power. The computer that solves the puzzle shares the solution to all of the other computers on the network. This is what we call as proof of work. The network will verify this proof of work and if it is correct, the block to the chain. This puzzle and verification proofs that the data is correct and we can trust it.
What is the difference between a blockchain and traditional databases?
Unlike the traditional methods (a book, computer etc.), blockchain is a decentralized system and distributed across a large network of computers all around the world.
So what is the difference?
“Traditional databases are around since the ’80s and they depend on a client-server architecture. This essentially means that a central server system in one location stores and manages the data.”
Centralized databases are fast because there is only one single authority. As a result, we have to trust the administrator.
In a blockchain, there is no administrator or someone who control the ledger.
In other words, anyone can access the blockchain. And also, there are all previous versions of the ledger , so we don’t need to trust a single authority.
On the other hand, blockchain is slower than the traditional databases as there is not just a single verifier.
They both have advantages and disadvantages but in my opinion, I would choose blockchain as trust is an issue in the modern world.
Traditional databases depend on authority and if the security of the authority is compromised, the administrator can delete the data. There are too many scandals about the lost of digital records.
In conclusion, for now, there are some negative sides of blockchain but I think, it can easily develop in the future, it will make us more independent.