June 11, 2021
• 2 Minute Read
Blockchain has been around since the early 1990’s, so why has no one heard of it until recently? That is all thanks to Bitcoin. Two guys by the names of Stuart Haber and W. Scott Stornetta created Blockchain as they wanted to create a system that would keep track of time stamps and minimize fraudulent transactions. Blockchain had not really been utilized until 2009 when Bitcoin was launched.
Bitcoin uses blockchain because they don’t want just one person or group to have control of the data. By using blockchain all users maintain control. Decentralized blockchains are irreversible so when transactions are made, they are recorded and anyone can see them.
Blockchain simplified is essentially just a database, which means it is an organized collection of data. The point of a database is to easily access, manage and update the data it contains. You have probably used a database at some point in your life. In-fact, you probably used one today! Databases power almost everything on your computer and on the web. Netflix, Amazon, and Google are all example of websites that use databases.
So why does Blockchain sound and or seem so puzzling? Probably because most people associate it with Bitcoin and that is what is hard to comprehend. Blockchain collects data in groups known as blocks. Blocks have specific storage capacities and when the storage of one block is filled it links onto a new block and forms a chain, thus the term Blockchain. When a block is filled it is time stamped and cannot be changed, each time stamp is specific to each block that is added.
I know what you’re all thinking, is this safe and secure? The answer to that question is yes. Blocks are stored linearly and chronologically, which makes it extremely hard to change what the blocks have already stored. In order for a change to take place, 51% of the blocks have to agree to the change.
Why use Blockchain instead of a bank? The typical transaction time for payments to/from a bank can take anywhere from 24-72 hours. With Blockchain it can take as little as 15 minutes or up to an hour depending on how busy the network is. Banks are typically only open Monday through Friday from 8am-5pm, Blockchains are open all day every day.
Bitcoin tends to improve accuracy by removing human involvement in the data storage process. It also costs less by removing the third-party verification. Transactions are secure and private and the technology behind it is very transparent. Blockchain is here to stay and will continue to improve.
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