If you know and understand the basics of cryptocurrency, investing, and banking for the past decade now, you might encounter the word “blockchain.” Blockchain is usually associated with cryptocurrency, particularly the Bitcoin network.
Key Takeaways
- Blockchain refers to a ledger that is typically utilized in cryptocurrencies, like Bitcoin.
- It is different from other standard databases you know of, considering that it holds the data in a block format that will be chained together. This is where its name comes from.
- A new block holds newly created data. After that block holds enough data, it will attach it to the previous blocks, enabling the cryptocurrency users to have more organized data.
- Blockchain can hold several types of data. But in most cases, it is being used as a ledger for performing cryptocurrency transactions.
- When it comes to any form of cryptocurrencies, such as Bitcoin, Blockchain refers to a decentralized method of transferring bitcoin tokens from person to person. This means it holds all the data restricting anyone to control it. A person can manage their Blockchain using their private keys.
- Immutable is the adjective that describes decentralized blockchains. This means that every information you enter is not reversible. In terms of Bitcoin, being an immutable ledger means that all the transactions you make are monitored and can be viewed by anyone.
The Security of Blockchain
Blockchain technology helps users who want to secure every transaction in different ways. One of the great things about it is that Blockchain holds the new data chronologically and linearly, offering easier and more organized access. If you are going to relate it to a blockchain run by Bitcoin, you will notice that every block is placed on a chain, which is known as height. In November 2020, the height of the Bitcoin blocks is already 656,197 blocks.
After adding the blocks to the Blockchain’s end, you might find it hard to change its content or go back to it. But, you can still do it only if most Bitcoin users give you their approval to do so. This is mainly because every block comes with its unique has, together with the hash connected to its previous hash. Hash is a code that was developed using a mathematical function, which turned into digital data of strings that contain both letters and numbers. If the content of the hash is changed, there are also some noticeable alterations in the hash code. To know more about bitcoin trading visit reliablecounter.com
This is because security is important in the world of blockchains and cryptocurrency in case of stealing bitcoin tokens or altering the contents in the Blockchain. For instance, if you are going to change even the simplest content in your Blockchain, you can’t align it again with the copy of others.
Considering the size of Bitcoin as well as its popularity and growing pace, pulling off this kind of feat might require you to spend a lot. Aside from being costly, you may also find that it would result in no good. Changing your blockchain content or stealing other bitcoin tokens will not be remained a secret. This is because Bitcoin users would immediately notice a significant change happened to the Blockchain. That’s why Bitcoin members will opt for the latest version of the Blockchain that offers a higher level of security.
Conclusion
Bitcoin and other forms of cryptocurrencies have their ledger or what we call Blockchain. As mentioned, Blockchain is a ledger that holds all transactions made within the network. It is also responsible for managing new blocks added into the chain.
We hope this article had given you additional knowledge regarding Blockchain.