Blockchain Explained

Blockchain is the technology used to make cryptocurrency possible. Did you catch our  Cryptocurrency 101 article?

How does it work?

Imagine four strangers sitting in a room, each with their own notebook which holds a record of every transaction that exists. All records are 100% digital and public.

If two transfer money to each other, all transactions are synced, so all notebooks should match.

If one notebook differs from the other three, that stranger is lying about a transaction. The transaction is not approved by the network and everyone identifies the potential scammer.

How does this relate to cryptocurrency?

Think of it as Bitcoin (the first cryptocurrency) is email and blockchain is the internet.

Future blockchain uses:

  • Entertainment – direct payments from readers to authors, viewers to movie studios, and listeners to musicians.
  • File storage – direct payment to private cloud storage providers.
  • International payments – removing fees.
  • Voting – avoid fraud with voter identification and accurate vote count.
  • Identity verification – avoid the risk of fraud or theft through direct sharing of identification documents.
  • Energy – direct transactions between private individuals to reduce bills (an example is solar panels).

Image Source: INTHEBLACK

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Blockchain Explained

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