We will keep this as simple as possible with decent terminologies. Just an attempt to make people understand a technology that will soon disrupt the business world, BFSI sector, the Healthcare system, and what not.
Why Blockchain is an emerging technology? How has it even become a buzz word?
To give an analogy, blockchain is the internet in the early nineties. It’s just waiting for the right time to explode as the internet did back then. Blockchain will connect the world so much more while the internet failed to do in that minuscule level.In a laymen front, Blockchain is a database with computer infrastructure called nodes. In a technical front, Blockchain is a decentralised distributed ledger technology. We will try to break it down the complex technical definition. Blockchain is decentralised meaning, there are no masters or slaves among the computer nodes. All the nodes act as a master here. No single entity or a computer node controls the system. Blockchain is distributed meaning, the nodes are being spread across the regions and multiple nodes are not being placed together in the same region. Blockchain is ledger technology meaning, blockchain stores the information in an electronic format. Then you may ask what the difference between a typical database and blockchain. The difference is how the data is stored or the architecture of the database itself. Basically, blockchain eliminates the intermediates in all business processes. For example, if you want to purchase an e-book online, instead of some online e-commerce company taking a cut in the money you pay and the credit/debit card company earning money on the sale. You can pay the digital currency directly to the author and unlock the book you wanted to read without any cut in the price. Money goes from you to the author. The second example, if you want to travel in air, say, from Chennai to Delhi, you must book your online tickets through online ticketing app like most of us do. Instead of them taking cuts in the purchase, blockchain will do that in zero (negligible) transaction cost. Only the ticket price. Now, the third example, if you want to transfer money online to your friend, you can transfer the money to your friend through online platforms like net banking, mobile banking, or UPI. Instead, blockchain will send the digital currency to your friend without having a bank as an intermediate. It’s good, right? But it’s way better than any other technology you name.
How does blockchain work?
We just want you to picture thousands and thousands of Google Spreadsheets, that are being connected in a loop or like a chain. Blockchain technology is designed to update all the transactions in the Google spreadsheet.Each transaction, you make that will be stored as a record. Each record is added to the block only after the network, called nodes, validates it.Source: Reuters Collective records will be stored in the block. Each block will be connected like a chain with another block using the Hash algorithm (Number of records is a block and the number of blocks is connected as a chain). With the picture below, you get to understand more clearly.Each block is linked with another with the help of the Hash function, which makes the Blockchain robust.On the internet, everyone, in the beginning, we had gone for a blind trust, be it Amazon, Facebook, or Google. Now, all three are frisking and growing tremendously because of trust. In the blockchain, trust is maintained because your transactions or actions are validated by the people in the network. Everyone in the network can view your transactions, provided by giving access to people who can view or who can edit.Facebook has some of your data even you might not be aware of it. But blockchain will give ownership of your own data which the Internet failed to do.We haven't touched the technical side of it, which needs a whacking dive to know about. To learn more about blockchain technology and want to develop or build applications on top of blockchain, IDS offer 3 courses like Certified Blockchain Developer Course, Certified Ethereum Developer Course, and Certified Hyperledger Course. One can have extensive learning through these courses.
Product Manager at IDS