What is a ‘blockchain’?
A blockchain is a ledger storing a record of transactions. Unlike a centralized store of data, the blockchain will guarantee a true record of events. All parties involved in transactions have access to the same ledger, which is spread out amongst many ‘nodes’, or computers containing this data. Moreover, once the transaction takes place, it is immediately stored on the decentralized network and added to the ledger. This cannot be tampered with, censored, or reversed, as each “block” in the chain is securely tied to the block that came before it. Hence, the name of this system. And of course, since this is a digital ledger, rules can be put in place that update the record using an automated algorithm. In other words, human error or criminal intent can be bypassed entirely. The result is a ledger more efficient and complete than any used before.
What’s this got to do with Bitcoin and other digital currencies?
Bitcoin was essentially the proving ground for this type of ledger. Bitcoin works without regulation because every transaction is publicly recorded into blocks and added to the Bitcoin blockchain.
How will this change our world?
In a phrase: “Exchange of value without intermediaries”
Due to the reliability and efficiency of blockchain technology, business can be conducted faster and more intelligently than ever. Not only will intermediaries such as lawyers and banks be unnecessary for many transactions, but computers can entirely automate business processes with one another, allowing ten employees to conduct business at a scale that once required a hundred. Businesses won’t need to wait on manual validation to proceed any more.
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