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Why is the Blockchain Technology Important?

We have 3.2 billion people who have been using the internet for now, which is just above half of the total population of the earth. To these netizens, bitcoins is not a new term. To people who don’t know what bitcoin is, it is a type of a digital currency, that has been predicted by many as a mean, that would revolutionize payments. Now, most of us do know about bitcoins, but where does blockchain come in to the game? So, blockchain basically is a transaction database, which is secure and is shared by all the parties who has participated in the network of computers. Now, what blockchain does is, it eliminates the need of a trusted third-party transaction analyzer, and instead, it records all the transactions that is happening in the network of computers, and gives the copies of all the transaction to each and every node of the network. Blockchain is a potential game changer, because, it reduces the usage or avoid the use of a third-party payment processor, and thereby reduces costs for the companies. At the same time, it provides for a transparent and trusted medium in the transaction between two non-trusted entities without the use of a third-party validation.

As of now, blockchain is still in the research phase. There is a consortium, a partnership of about 45 leading companies, who are now researching on the blockchain technology and its implementations. Blockchain is of immense help, to the industry who are in to transactional services. In every industry transaction is more or less needed, and hence, the implications of blockchain would be immense.

 

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Then, why is bitcoin so important in the story of blockchain technology? Bitcoin is important in the blockchain technology is important, because blockchain has already been implemented in the bitcoin exchange procedure. Hence, bitcoin exchange and transaction are the first proof that, what blockchain can mean to the industries.

The sophistication and the chic, of blockchain technology is that it, removes and averts the use of a central database who would verify the different entities involved in the transaction. The power and control of the third-party validation is now divided in to the different entities in a blockchain, who don’t even know each other.

The uniqueness of a transaction system like, blockchain is that, it is very novel. It provides a fair and a non-corrupted way of transaction, where every transaction that is happening in the system is recorded, and the amazing thing is, the record is public, which generally goes on to mean that, every entity in the network can see the transactional records. Now, every transaction is first verified by sophisticated algorithm both in the sender and the receiver side. After verification, it is added in the report ledger.

Decentralized systems such as Blockchain will always win over the centralized systems such as maintaining a central ledger, because it is less costly and more efficient to handle a decentralized ledger. Now, some may consider transaction over bitcoin isn’t a very valuable service, and blockchain technology needs to show us more concrete proof that, it actually is a very valuable service. As per some of the companies who has been researching on blockchain technology, blockchain technology can streamline a process related to trading and finance. For instance, farmers don’t get paid at the right time, which causes conflicts between farmers and the buyers. Implementation of blockchain technology in these types of transaction will streamline the process and bring about a change in the entire scenario.

Blockchain technology also looks forward to digitize the entire procedure of pen and paper. In this age of modern computers, there are still some industries who handle their finances by using pen and paper methods. Implementation of blockchain will change the scenario, and ease up the procedure of handling transactions and finances.

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