Blockchain Technology and Its Future

Blockchain has made a hit, recently. There has been a lot of murmur and rumbling among the investors regarding it, and without any doubt it has become a trendiest technology in the past few years. For a layman it might be a baffling term, but those geeking out over this subject might find this blog very helpful. So, let’s delve deeper!

What is Blockchain Technology?

Blockchain is a user friendly way of storing and keeping record of the information or transactions. To be more precise, it is a model that stores or keeps transactional data (which can be referred to as blocks) of people in some databases (also known as chain), through a peer to peer network. Blockchain is a safe and secure structure as each and every transaction is sanctioned by the owner’s signature in a digitalized way, so there are no issues of tampering or corruption of data. Through a nexus of computers, the transaction are distributed and duplicated. As blockchain is a digital ledger, it strongly prevents system from being hacked, reverted or manipulated. 

Blockchain technology has been underpinning applications from different sectors for example ecommerce, supply chain, banking and finance, health care, manufacturing etc. Such businesses manage their transactional information through in house teams or through external sources like brokers, financial analyst, or lawyers. This can be costly and time consuming procedure. Blockchain makes your transactions hassle free, transparent and less costly, cutting short this whole long process. Some people confuse this technology with Bitcoin but these two are not the same. Bitcoin currency itself depends on Blockchain to safeguard itself. 

Blockchain is an amalgamation of the below mentioned technologies:

1. Peer to peer network that has a distributed ledger

2. Cryptography keys: There are two keys in cryptography, private and public which makes transaction between two individuals easy and successful. These two parties are connected with each other through a network. Each party possess both these keys which helps them to produce a digital signature and a safe identity. These keys are responsible for the authorization and management of your transaction

3. A system to compute and store data or transactions and maintain network's record

Advantages and disadvantages of Blockchain

Some advantages and disadvantages of Blockchain technology are listed below:

1. Safe and secure: Blockchain's digitalized form of signature has made the transactions secure, without the risk of fraud or scam. Through this unique feature no one can copy signatures, data cannot be corrupted or altered by other users. As more blocks are added to the chain with updated information, it becomes difficult for hackers to make changes to it.

2. System is decentralized: Normal transactions usually require the prior approval of regulatory commission such as the banks or respective government departments. However, in the case of Blockchain transactions takes place mutually, through the agreement of both parties/ the users. This makes transactions faster, efficient, and trouble free.

3. Automated feature: Blockchain allows you to have automated verification as it is programmable and no middleman is involved in this process and payments are made automatically. This feature makes it more systematic and organized in terms of processes and actions. 

4. Fast and efficient: Unlike traditional banking systems which takes days for the completion of transaction, blockchain is a very convenient and a faster alternative. No other financial institutions are involved and it takes few minutes for a successful transaction.

Disadvantages of Blockchain

1. Cryptographic keys are required: One major disadvantage of Blockchain is that it requires both private and public keys. In case an individual loses his/her private key it can be very problematic and you will have to face dire consequences. 

2. Scalability issues: Another problem is associated with scalability. You can make specific number of transactions per node which makes the transaction process long (sometimes several hours to complete).

3. Immutability: Immutability is another disadvantage. Once data is recorded it is difficult to edit or make changes in it.

The four major branches of blockchain are:

1. Public blockchain Network

For this blockchain you do not require any permission. Anyone can freely join it, carry out transactions, or take part in the core activities while their identity remains hidden. Bitcoin, Litecoin and other cryptocurrencies are included in this. In Public blockchain network, there are no issues of corruption, centralization or security glitches. The nodes manage the network and also update the ledger. While the consensus algorithm establishes reliability by validating the information.

2. Private blockchain Network

This is mostly used by large companies and organizations where you require a consent or permission in order to be a part of the network. Private blockchain network relies on third parties for transaction and network administrator handles it. Customization options are available for security and accessibility.

3. Hybrid blockchain network

This is also called permissioned blockchain that grants distinctive access to authorized members. Many companies use this blockchain because it is very efficient. They can also decide who can take part in the network and in which transaction.

4. Consortium Blockchain

Just like hybrid blockchain it is a combination of private and public blockchain networks. But one thing that distinguishes it is that a bunch of organizations have to control and handle one consortium blockchain network. This whole procedure of collaborating with different organization to set up a network can be very complex, but once it’s operating it can provide greater security.

Ways to invest in Blockchain

There are several ways to invest in blockchain technology which can be very fruitful. You can invest in Bitcoin or Penny cryptocurrencies such as Stellar, Litecoin, Ethereum, Altcoin etc. Individuals can also invest is new businesses that are emerging and using blockchain technology. Apart from that, experts are also developing some apps to collect funds by using this technology and you can buy coins which can be a lucrative investment. In future an increase in the prices will be beneficial for you if the app gains popularity among the public.

We have witnessed a remarkable industrial transformation as a result of blockchain technology. There is no doubt that it has highly secure features and third party cannot meddle with it. Blockchain is currently in a nascent phase but it has a long way to go and investing in it will not go in vain.