Many have heard the term “blockchain”, but not everyone will be able to explain what it is and why it is so popular. This term has settled in the minds as something complicated in the field of finance. In fact, we are talking about an ingenious and at the same time easy-to-understand invention, that has rapidly gained a foothold in the past few years. Without going into details, we will try to explain the essence, briefly and easily in the following article.

Blockchain Explained

The word blockchain itself is derived from the English block and chain, that is, these are blocks connected along the chain. These blocks store records, as well as a label indicating a connection with another block. These labels determine the sequence that forms the entire chain. When a large amount of information is written into a set of blocks, the chain, in fact, becomes a puzzle. It can be assembled only in one case – when all the details fall into place. Accordingly, the entire array of data can be represented only in the only correct form and nothing else.

Why Is It Reliable?

Recording information in blocks allows you to protect it as much as possible from theft, changes and any unauthorized access. All blocks are always stored in the form of millions of copies on thousands of different computers in encrypted form. Changing one block leads to a violation of the entire system and, accordingly, denial of access.

It is decentralization that is one of the key features of blockchain technology. Without a single information storage centre, there is no risk of losing important records due to hacking. The system does not have a single point of failure, and it is impossible to control it independently. This is a distributed autonomous network without a main server, but with an ever-growing number of entries. A change to any old record will always be shown as inconsistent with other copies.

How Is It Used?

The potential for using blockchain technology is enormous. The volume of confidential and important data is growing day by day. We are talking about any database, its records and any transaction. All of this can be recorded in chains and transmitted directly to the recipient, bypassing a huge number of intermediaries and financial institutions. Only the sender and recipient will be involved. The reliability will be ensured by the participants in the distributed network, who have encrypted copies.

Because of that, blockchain and cryptocurrencies are widely used in the online gambling industry. With the advent of Bitcoin casinos, traditional gambling sites also adopt payments with cryptocurrencies. You can visit the casino website and try out different games, including blackjack with cryptocurrencies. These games follow the provably fair algorithm, ensuring the fairness of games.

Transactions store the necessary data about the time, participants and amounts. At the same time, all of them are in public access and are constantly checked against copies to confirm the integrity and relevance of the chain.

Using blockchain, you can register transactions, track logistics, and conclude contracts. You can also make transfers and perform any other operations that usually require the processing of large amounts of data. It can be used in any service where there is even the slightest risk of losing valuable information.

What are Miners and Bitcoins?

The demand for such distributed networks creates the need to attract large capacities to track new transactions. This is what the so-called miners do. They are users who, using their own computers perform special mathematical algorithms. The speed of their execution directly depends on the power of the video card or processor installed on the PC.

For performing such operations, miners receive a digital currency, which is most often understood as bitcoin. However, there are a number of others. Regardless of the name, this is a decentralized cryptocurrency. The value of the cryptocurrency is determined by the exchange and depends on the demand for the blockchain as a whole.

The issue of regulation of cryptocurrencies in numerous countries is also being considered. Though, at this stage, the discussions have not led to any significant results. In countries such as the Central African Republic, Bitcoin is already a legal tender, meaning that it can be used as an asset to purchase goods. For a lot of people, Bitcoin is considered an asset of the future and it is hard to disagree with them.

Is There a Future?

The fundamental principles of the blockchain are gradually penetrating and will penetrate into various areas of our life. The technology is not limited to financial transactions and avoiding intermediaries. Representing information as a complex puzzle of blocks distributed over a huge number of media can secure any automated processes that we encounter.

Anything that can be hacked will be protected by blockchain. Here we are talking not only about websites and services. We also consider the stuffing of unmanned vehicles, smartphones, and smart homes. The time is not far when countries, organizations and individuals will adopt blockchain and various cryptocurrencies.

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Annabel Johnson

Part time gamer, reviewer and blogger. Full time geek and tech expert!

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