The development of Blockchain technology and Bitcoin has been very fast. In a number of instances, even those individuals who don’t know anything about cryptocurrency are looking to make an investment in this field. These days, Blockchain technology has turned out to be a parallel platform where a majority of people have started executing their regular transactions. What is a Blockchain? Most individuals have always been struggling to simplify insecurity of various institutions by finding better options. The banking system improved the shape of informal financial system, and now, blockchain is estimated to be another such digital economy path-breaker. The method was originally described in 1991 by some researchers and was originally proposed to timestamp digital documents, so as to make sure that they stay untampered. On the other hand, in 2008, the proposal was utilized by Satoshi Nakamoto to generate a digital cryptocurrency ‘Bitcoin.’ And ever since there has been global chaos looking into its possible avenues. Blockchain is an open infrastructure featuring blocks of information linked jointly. The linked blocks enclose references to the preceding block. Like a public ledger, Blockchain is a decentralized and distributed system that stores a registry of transactions and assets in a peer to peer network. People all over the world preserve their copy of each blockchain transaction. These copies have details of each transaction and the system is validated accordingly. The system is held in concert by the technology known as cryptography. The purpose of this technology is to make sure that the data does not get tampered or counterfeited. The network maintains a large number of linked computers, so as to prevent any attack by a hacker for fraudulent transactions. Features of Blockchain Technology
- Security In today’s digital financial system, one of the main concerns is online security. In this matter, Blockchain deals with this concern to a large extent. Blockchain Technology counts on a consensus from all network associates for the confirmation of a transaction. And all confirmed transactions are stored in the data blocks which cannot be changed or remove by anyone.
- Decentralized system Blockchain utilizes strong cryptography to build transactions that are invulnerable to fraud and this is a reality. In addition, all the transactions are signed with the aid of secure digital certificates. The accessibility of a decentralized system makes it problematic for hackers to break the transaction by targeting the single decentralized unit having all the data is stored at a single base.
How does Blockchain Technology solve Banking problems?
- Ledger Openly Accessible In comparison to banks and other financial institutions, Blockchain technology pursues a decentralized approach. The ledger which holds the transaction details happening on the Blockchain is totally accessible to every person who is connected with the system. After joining the Blockchain network, you can download the complete details of transactions since its beginning. Although the complete ledger is openly accessible, and the details of the individuals engaged in the transactions remain anonymous.
- Verification of Every Transaction Each and every transaction is verified by checking the ledger and the confirmation signal of the transaction is sent within a few minutes. With the utilization of complex encryption and mixed algorithm, the matter of double spending is eradicated.
- Low Transaction Fees Blockchain technology involves low transaction fees and this is comparatively quite less to the fees implied by different banking institutions. In case, if a transaction needs to be completed at first, then an extra transaction fee is levied, so as to have the transaction confirmed on a priority basis.
Blockchain technology is an open and shared ledger that maintains a record of each and every transaction. It cannot be alerted or removed by anyone. The technology is based on a decentralized system and the data is accessible to every person associated with Blockchain. The entire system is securely managed by a network of linked computers.