What is blockchain?
Blockchain is a distributed digital ledger that records transactions that automatically encrypt every 10 minutes in a process called "hashing." Each hash completes the latest block in the blockchain. This technology was originally intended to secure Bitcoin, and later other cryptocurrency transactions, but its adoption and application are expanding.
Image courtesy wix.com
This ability promises to vastly improve product integrity and financial integrity and security in the digital marketplace. You could safely say we are entering an era of the Internet of trust.
The rest of this article will discuss what is meant by some of the terminologies that cluster around blockchain.
What is the distributed ledger?
A distributed ledger is constructed of nodes (computers) scattered across the Internet. Each node stores its own tamper-resistant copy of the previous block. These transactions are made peer-to-peer, and the transparent, decentralized, and encrypted nature of this network of computers, means third parties are not required to secure transactions.
What is meant by blockchain transparency?
Blockchain transparency means that though records of transactions are encrypted and tamper-resistant, they still allow a transparent chronology or visible history to subsequent transactors. In other words, people who are stakeholders can view earlier activity or the path a product or document has taken with all of its changes and developments over time.
What is meant by the term decentralized?
Decentralized transactions mean no governmental authority or financial institution is required to implement a safe transaction over blockchain. Instead, smart contracts enable purchases, or other actions take place privately, directly between 2 parties. This peer-to-peer format also cuts down on fees and eliminates privacy concerns.
What are smart contracts?
A smart contract is a program that executes the next stage of a blockchain transaction, once the preliminary conditions have been met. This continues until the operation is complete. Once shipment confirmation is received funds are released for payment.
What are the advantages of blockchain?
Blockchain technology streamlines process, cuts down on expenses, eliminates human error, and automates accounting and follow up. It will revolutionize the supply chain and will also cut down instances of both data and privacy breaches on a global scale.
We trust this list of blockchain terminology is helpful.
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