1.0       What is Blockchain Technology?

Today’s businesses are turning to enterprise blockchain for transparency and security. Organizations are searching for a simple blockchain definition to help them understand this emerging, “distributed ledger” technology. 

Blockchain is a system for keeping information that is unchangeable, trustworthy, and transparent, typically records of financial transactions. It operates as an ever-expanding chain of data blocks. The chain can only be altered up until the point where new blocks are added to the end. Everything that is sufficiently ingrained in a blockchain is permanent.

Thousands of users or nodes receive access to all the blockchain data through the system. Blockchain does away with the requirement for an intermediary to certify transactions and offer guarantees in this way (like a bank does in traditional currency transactions).

2.0       How does Blockchain Technology Benefit the World?

Additionally, by eliminating the middleman, this technology enables businesses to save money and increase revenue. Businesses can validate and conduct secure transactions more directly with blockchain technology. Theoretically, transactions take place without the involvement of lawyers, bankers, brokers, and other intermediaries, and they do so in a more interactive manner because any person in the chain can make modifications to the data, which other participants can then access and approve.

According to the National Institute of Standards and Technology (NIST), in 2008, the blockchain idea was combined with several other technologies and computing concepts to create modern cryptocurrencies: electronic cash protected through cryptographic mechanisms instead of a central repository or authority. The first such blockchain-based cryptocurrency was Bitcoin.

The Bitcoin blockchain is stored, maintained, and collaboratively managed by a distributed group of participants. This, along with certain cryptographic mechanisms, makes the blockchain resilient to attempts to alter the ledger later (modifying blocks or forging transactions).

In Conclusion, the use of blockchain technology is not a silver bullet, and some issues must be considered such as how to deal with malicious users, how controls are applied, and the limitations of the implementations. Beyond the technical issues that need to be considered, there are operational and governance issues that affect the behavior of the network. For example, in permissioned blockchain networks, described later in this document, there are design issues surrounding what entity or entities will operate and govern the network for the intended user base. Blockchain technology is still new and should be investigated with the mindset of “how could blockchain technology potentially benefit us?” rather than “how can we make our problem fit into the blockchain technology paradigm?”. Organizations should treat blockchain technology like they would any other technological solution at their disposal and use it in appropriate situations.

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