Cryptocurrency, bitcoins, virtual currency - we hear all these not always understandable words in the news, we read on the Internet almost every day. Another similar concept related to earning cryptocurrencies is blockchain technology. It is difficult to explain what it is in simple words, but everyone can figure it out.
Blockchain technology is a large chain of blocks with data recorded in them. Sometimes such chains are also called banks or databases, but there is a significant difference between blockchain and standard databases. In the latter case, blocks of information are stored on the server, while in the first case, there is no specific place for recording information. A huge list of data blocks is distributed among users' computers connected to the system. Moreover, each subsequent record includes a link to the previous one, and so on.
Each user can change only his part of the data block, while he does not have the ability to influence other records. Each block of data also has copies on the devices of other users, so that the entire database is evenly distributed among the computers on the network.
All transactions on the network can be viewed by any user of the network, regardless of his location and time.
In simple words, blockchain technology can be described using the example of a doctor's record in a medical history. The information indicated by a particular medic on the card is one of the blocks that other doctors cannot change. In this case, subsequent entries in the medical history are associated with the previous one. And they all have labels - specific dates.
In the case of blockchain technology, blocks of records, like the doctor's marks in the medical history, cannot be changed by anyone. At the same time, a certain number of users have access to the information itself, as well as to the patient's card, which can only be used by certain medical workers.
The first cryptocurrency bitcoin is precisely based on the use of blockchain technology. The idea of the author Satoshi Nakamoto was to develop a means of payment that would be protected from outside influence: not only the influence of users, hacker attacks, but also politicians, central banks of states, and server owners. Thanks to the blockchain, the bitcoin rate regulates the market, that is, there are users themselves, and the currency is completely safe.
Thus, an important difference between blockchain is the complete absence of centralization. The database works autonomously and is not controlled by anyone.
If it became clear to you what a blockchain is, then you can describe in simple words the essence of its work. As already mentioned, thanks to the blockchain technology, a database is created, in the blocks of which all the processes that occur with the cryptocurrency on the computers of each user in this network are reflected. The blocks can be conventionally divided into several parts: a header with the amount, time of creation, a link to the previous operation, as well as the content of the record itself, which contains all the data about the participants in the transaction and full information about the transaction. All blocks have a strict sequence, and to work with the technology, you need to have access only to the last block. Despite the fact that the database is constantly growing, such access can be obtained at any time.
The blockchain system undeniably has many advantages. This is the maximum data protection, thanks to decentralization and automatic encryption, no hacker has yet managed to break into the system. No user can have information from previous transactions. therefore, it is impossible to change any of the blocks retroactively. All transactions are accurate and prompt, since there are no intermediaries in the blockchain at all.
Most often we hear that a technology such as blockchain is used in the context of cryptocurrencies, but its application is universal. The system can be attractive for secure network administration, storage of electronic certificates, patenting and copyright preservation, conducting secure transactions in various fields without the participation of banks, notaries and other intermediaries.
