A blockchain is an information storage and transmission tool that is completely transparent and secure. This is in the form of a database in which we find the history of all the exchanges that have been made since it was opened. Moreover, this database is shared by all its users, without any intermediary. Thanks to this, everyone can check the validity of this chain.
There are public and private blockchains. A public blockchain is open to everyone and is like a public ledger, anonymous and cannot be tampered with. Everyone is therefore able to consult it freely and free of charge. It is possible to add content, but it is not possible to delete or destroy the channel. A private blockchain remains much more confidential, being only accessible by authorized persons.
How Blockchain Works
To work, the blockchain requires the use of a programmable currency or token (also called token). For example, you can use Bitcoin.
In the blockchain, all transactions are grouped together in the form of blocks. Each block must then be validated by the network nodes using an algorithmic method. Once the block is validated, it is added to the blockchain and therefore becomes visible to all users. Here is a diagram that will allow you to illustrate this definition.
What blockchain can bring
Due to its transparency and security, the blockchain can be used in other contexts than the monetary field. Indeed, it can be used for the transfer of assets, whether in a monetary context or for the transmission of securities, votes, shares and bonds. But it can also serve as a register and thus ensure better traceability of products and assets. Finally, it can be applied in the context of smart contracts. These are stand-alone programs that allow the automatic execution of the conditions and terms of a contract, without the need for any human intervention.
Blockchain can therefore be applied to many sectors, among which we can cite the banking, industrial, pharmaceutical, insurance and health sectors. It makes it possible to replace trusted third parties with a reliable and fully automated system.
What you must remember
- Blockchain is a tool for storing and transmitting information reliably, transparently and securely.
- It traces the history of all the exchanges that have been carried out since the opening of a blockchain.
- You will find public and private blockchains.
- In a blockchain, all transactions are processed in the form of blocks that must be validated by network nodes before appearing in the blockchain and being visible to all users.
- Its transparency and security allow the blockchain to be used in several applications that go beyond the scope of finance.
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How does blockchain work? – COIN24.FR
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