“Once widely adopted, blockchain will transform the world.” Ginni Rometty, CEO at IBM
Blockchain is the digital, peer-to-peer and decentralised ledger that records all transactions. It’s a record of events/ data that is shared between many parties. More importantly, once the information is entered, it cannot be altered.
For simplicity purposes, we will talk about only two types of databases: centralised and decentralised.
A centralised database is located, stored, and maintained in a single location, which means: the information only exists in one place and with a central admin. Most importantly, to process data or to share your own data stored in such database, you need to be granted permission by this same central admin.
A decentralised database (blockchain) doesn’t have a single location. Pieces of information are stored in different locations which are all connected to each other. Processing of the data in this type of database is distributed between different nodes. No one person controls the database and users own and control their data.
A smart contract is a piece of computer code that is capable of monitoring, executing and enforcing an agreement. Smart contracts can be used for exchange of money, property, shares, or anything of value in a transparent, conflict-free way while avoiding the services of a middleman.
Blockchains store data using sophisticated math and innovative software rules that are extremely difficult for attackers to manipulate. It is very challenging, almost impossible, to change any transaction information once it is validated and becomes part of a block. Users on the blockchain have a perfect audit of any changes made to their data – and they can see what was changed, who changed it, when it was changed. So yes, we can say that it is secure.
The answer is no. Bitcoin is a digital currency and is the first successful blockchain product. Blockchain provides the underlying technology (database), and the potential uses for blockchain are far broader than crypto currencies. They say “blockchain is to Bitcoin what the Internet is to Google”.
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