An Introduction to Blockchain

Blockchain is one of the newest technologies to hit the world stage. Blockchain technology will revolutionize how we do business in this country and all around the world.

Blockchain is considered to be Internet 3.0. Industry leaders in finance, food supply, energy, healthcare and other areas including government believe that it will change our world as much or more than the internet has over the last two decades. Sometimes you may hear Bitcoin and blockchain used interchangeably, but don’t be confused. Blockchain is not a Bitcoin.

Blockchain is the technology used to support Bitcoin transactions. Blockchain itself is a digital database designed to process transactions and store information securely. Blockchain technology can make it faster, cheaper, more efficient, and more secure to transact almost any kind of business anywhere in the world.

It is boasted that blockchain will be a three-trilliondollar industry. IBM’s General Manager of blockchain, Marie Wieck, sites research from Gartner, Inc. which estimates blockchain will add $3.1 trillion to the global economy by 2030. Yes, three trillion dollars! All those zeros are really exciting!

Blockchain makes the process for completing transactions more streamlined and automated. As a result, data is processed within seconds so results for any transaction is almost immediate instead of taking hours or days. It can speed up processing financial transactions. Also, there is no need to wait for a third party to say your transaction is approved and charge a fee.

All businesses want to reduce their costs and consumers want to pay fewer fees or no fees at all. Since blockchain data processing platforms eliminate the need for a middle man, it costs less to do business. Blockchain also cuts costs by eliminating a lot of paperwork and computers servers used to process and store information.

Blockchain technology offers some very trustworthy security measures:

1. Cryptography is used to encrypt or code all information on the blockchain, meaning it turns plaintext into computer code.

2. No one can randomly change, delete, or misplace information on the blockchain. If a change is needed, a whole new block has to be created and its contents have to be approved by the network participants. The block with the incorrect information remains part of the blockchain.

3. Since blockchain does not have one central authority running everything, information is not stored in just one location. It is stored in digital ledgers and each node on the blockchain has a copy of the ledger.

4. Can blockchain be hacked? A hacker would have to take over 51 percent of the nodes in the network. There can be hundreds of nodes and they can be anywhere since there is no centralized system. It would be very, very difficult for hackers to invade a system and steal or compromise the information.

Once a block of information is created and added to the blockchain, the information in that block cannot be changed. The information (data) is immutable (unchangeable).

If an error is discovered, a whole new block must be created containing the correct information. Just to make sure everyone knows this new block is correcting an error in a previous block, the new block has to reference the block that contains the error. Both blocks remain part of the blockchain forever.

When businesses use the old fashioned, paper-pushing method to get a transaction completed it’s a long process, costs money, and there is always a chance for human error.

Blockchain uses a digital super highway to process transactions quickly. The individuals creating the blockchain network simultaneously work to verify transactions, so you don’t have to wait hours or days for a transaction to be completed. Intermediaries—the famous middle man—are not needed, which results in transactions being completed at less cost and much faster.

Since the process is done by a computerized mathematical system, human error is extremely rare.

Blockchain also eliminates the need to trust those mysterious behind-the-scene people who work on your transaction request. Who are they? Why should you trust them to handle your personal information? No need for that with blockchain. Requests processed on the blockchain are encrypted and securely stored on the blockchain. Hackers don’t have a chance.