Definition
Blockchain can be termed as the interlinking of blocks that contain some kind of information within it. It can be called a list being displayed to the public that stores information related to the virtual currencies that are available in the market for carrying out transaction-related stuff. This technique that is used nowadays in many countries was discovered in the year 1991 by a group of researchers to avoid any kind of fraudulent actions taking place by backdating work. The technique of storing information however was not used for a long time until one day Satoshi Nakamoto implemented this to create the famous cryptocurrency Bitcoin. This technology that is used by different countries works as a ledger where the transaction-related things are preserved along with proper identity. It is so secure to store data in a Blockchain as once a data is saved then it becomes near to impossible to manipulate it by intervening into the same.
Working
So, talking about its working, it contains numerous blocks that are interconnected with each other and each block contains some data, the hash of the current block, and the hash of the previous block. Every data that is stored inside the blocks depends upon the type of Blockchain. This can be started with an example, if the Blockchain is associated with Bitcoin then it will store data related to Bitcoin transactions only. The data we are referring to is the sender of the coin, the receiver, the timestamp of the transaction, etc. As discussed the components of blocks contains a hash which is nothing but a type of fingerprint.
It contains the type of block used and acts as a unique identification number for that particular block. Once the hash is generated than any change in the block will directly reflect a change in the hash and therefore any change in the hash leads to the update of the same and creation of new blocks. Also, the previous hashes that are connected with the present block make a proper chain that links different blocks with each other, and hence the name is given as Blockchain. The first block in a Blockchain is termed as Genesis Block and is regarded as a key block in the chain.
Hashes, as we mentioned earlier, helps in maintaining the authenticity of the Blockchain but, they too have some limitations and once a block hash has tampered then the whole chain becomes worthless. So, to overcome this problem we have a life savior called Proof of Work. It can be termed as a mechanism that helps in slowing down the process of block creation in a Blockchain. Calculating proof of work in a block takes time and hence mitigates in any type of discrepancies occurring. So, if one block tampers then one needs to calculate Proof of Work for every block. Hence we can say that Proof of Work and hashes together contribute to maintaining the security and encryption of the Blockchain. The security maintenance of the Blockchain also comes by creating a P2P network called Peer to Peer network where every individual associated with cryptocurrency transaction are given a separate Blockchain. This way one user can create his/her blocks and the nodes in the block can secure the Blockchain by sending the blocks to the network of users called the Consensus. After validating the blocks by the Consensus these are added to the current Blockchain. So, all the three major components for securing the Blockchain are adopted and any kind of theft is dealt with.
List of Top 3 Cryptocurrencies with their Prices
- Bitcoin: The most expensive cryptocurrency of all time and always on top compared to its fellow competitors. The current rate as per records is US Dollars $10,286.51 per coin.
- Ethereum: Second in the chart after Bitcoin with a worth of US Dollars $364.67 per coin.
- Tether: Third most expensive cryptocurrency with a value of US Dollars $1.00 per coin.
Conclusion
Keeping in mind all the legal matters related to making transactions with cryptocurrencies and the terms and conditions associated with these for different countries we can avail the benefits of the same and carry out transactions with them.
Nice Article. Thank you for sharing an Informative article. Blockchain will disrupt every sector in the near future. Many Blockchain Development Companies. are working to make the Blockchain sector better. To know about the leading blockchain company.