For a public perspective, the word blockchain technology was first heard of after the sensational rise of the Bitcoin cryptocurrency last year. Naturally people wanted to get in on a slice of the action but first they had to understand what the blockchain was, and how they were supposed to use it to buy some crypto. Many more of us now know that blockchain is not exclusive to Bitcoin, or indeed cryptocurrency, but it is a technology which can be used to win a wide variety of industries. To help you further understand more about this technology, here are some of the most common FAQs answered.
What is Blockchain?
Let’s start with the meaty question, what is blockchain? Well in its most basic form blockchain technology is a public ledger which is used to store information about a transaction, it will timestamp the transaction and record all of the vital information about it, this is what is called a block. Once a transaction is completed it cannot be changed or removed, it will stay in the ledger forever.
What is New About it?
The most exciting thing about blockchain is its automation, any information which is stored in this decentralized ledger will have been written automatically when a transaction is completed. Another exciting prospect of it is the ‘chain’ the way in which this technology can create links between blocks, bringing relevant pieces of information together.
How Does It Help?
The best example to give here is something Facebook and Google. How do they know how to target ads towards something which you have shown an interest in? In this case, both companies sell data which they have to companies who use blockchain technology and use this data to give you suggestions based on what it thinks you will enjoy – scarily accurate and a live example of this technology. It isn’t all so shady however, you will also find businesses that use a blockchain logistics application which increases speed, efficiency and minimizes costs. If we take the logistics example, through this technology all the information about deliveries, destinations, route times, tracking, orders and safety will come together in a single ledger which offers better information to recipients and the logistic companies. This tech is really spellbinding, contracts can be made through the blockchain which will be digitally broken if requirements aren’t met, the businesses will receive smarter information about fastest routes and the additional transparency helps trust between clients.
Clear As Mud?
The easiest way to discuss blockchain is that it is a series of building blocks with information stored on them, blocks with similar information create a chain and once the chain is formed the information can pass through the different blocks. The possibilities of this technology are endless and it will soon become the most used type of software on the planet.
Don’t worry if you don’t completely understand blockchain, it can be tough, just try to simplify it and you will get it in no time at all.