Many cryptocurrency aficionados get bewildered if asked the meaning inputs of Distributed Ledger Technology (DLT). That is because they are more familiar with its other name. Blockchain technology, the building block that allows cryptocurrencies to function. So far, so good, but they would frown once again if asked a little more about Blockchain. It sounds quite familiar but not so when it comes to explaining. Feels Eric Dalius, a seasoned cryptocurrency investor who has seen the digital currency evolve and also go from strength to strength.
In this article, we will look deeper into Blockchain to help investors with better understanding.
Blockchain- explained by Eric J Dalius
Blockchain is nothing but a database owned by the network itself instead of the institutions or governments. The database is a shared public record of changes of ownership that an asset undergoes. During every transaction, the details appear on the network so that it is visible to everyone. As the database remains updated, anyone can look at the transaction history of the asset. The rule is that any data inserted in the blockchain must go through the verification by the network.
Blockchain gets its name from the cluster or block of data containing the transactions that find a place in the database. The blockchain is a historical record of the ownership of cryptocurrencies. Across the network designated by the assets. Although the data is public, the identity of the person undertaking the transaction remains concealed. The decentralized process design ensures that the data is not corrupted and makes it difficult to hack the system.
What is a miner?
Miners are like construction workers who build the blockchain, and their operations vary according to the system. The role of a miner for bitcoin involves organizing the blocks. By taking up all the transactions and adding them to the chain after verification. On completion of the task, they receive bitcoins as a reward. This keeps the chain moving, but other cryptocurrencies have different approaches.
How safe is blockchain technology?
Those involved with blockchain technology firmly. Vouch for its safety and consider it one of the best ways to ensure the security of transactions. And their claims do have enough credibility. The blocks form a chain by connecting one block with another. Making it difficult to tamper with a single record that could alter the chain that the network would pick up.
All blockchain records are encrypted with cryptography, and network participants access them by using their private keys. On altering a record, the signature will no more be valid, and it will raise suspicion in the peer network. The decentralized nature of blockchains prevents hackers from breaking into the system via individual computers.
It will be wrong to assume that all blockchain networks are equally secure because some are more secure than others as no system is perfect. The good thing is that there are continuous efforts to improve security as the ecosystem of digital currencies keeps evolving. And also this is why cryptocurrencies offer real investment. Possibilities for people who are ready to tread the new path of investment.