distributed ledger technology ased on a peer-to-peer (P2P) topology, blockchain is a (DLT) that allows data to be stored globally on thousands of servers, while letting anyone on the network see everyone else’s entries in near real-time.
- A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.
- Each block in the chain contains a number of transactions, and every time a new transaction occurs on the blockchain, a record of that transaction is added to every participant’s ledger.
- The decentralised database managed by multiple participants is known as Distributed Ledger Technology (DLT).
- 3 basic parts of a block:
. Blocks store information about transactions like the date, time, and the amount of the most recent transaction.
. They store information about who is participating in transactions.
. They store information that distinguishes them from other blocks.
. Blocks have a unique code called a hash that allows us to tell it apart from every other block. Hashes are cryptographic codes created by special algorithms.
- Each computer in the blockchain network has its own copy of the blockchain, which means that there are thousands of copies of the same blockchain.
- Although each copy of the blockchain is identical, spreading that information across a network of computers makes the information more difficult to manipulate.
Applications of Blockchain Technology
- Smart Contracts
. Smart contracts are like regular contracts except the rules of the contract are enforced in real-time on a blockchain.
. It eliminates the middleman and adds levels of accountability for all parties involved.
. Blockchain enables patients and doctors to securely transfer sensitive medical information.
. The smart contracts even display details of personalized health plans for each patient.
- Decentralized Cryptocurrencies
. Basically, a digital asset, blockchain cryptocurrency is designed to work as a medium of exchange.
. It works on digital channels and are often adhered to strong cryptography to secure financial transactions.
- Financial services
. Each party in the process, such as a broker, custodian, or the settlement manager, keeps their own records which create significant inefficiencies and room for error.
. The blockchain ledger reduces error by encrypting the records and cancels the need for intermediaries.