How Does Blockchain Technology Works?

Blockchain is the technology behind the famous digital currencies ( Bitcoin, Litecoin, Ethereum, etc.) which have been making headlines in recent years. This technology makes it possible to distribute information digitally of any kind, but not to copy it: this means that each piece of data can have only one and unique owner. But if you already have an idea of ​​what technology is, do you know how Blockchain actually works?



How blockchain technology works

The operation of this technology does not rely on extraordinary advances in computing or the capabilities of modern computers, but more on the use and organization of three technologies already well in place:

  • The cryptography of private keys,
  • A distributed network with a shared account register,
  • Ensure secure transactions in which all stages are verifiable and tamper-proof.

Take the example of a person wishing to make transfers over the internet using the blockchain. This person is assigned a so-called private key and a so-called public key. This first step allows you to create a secure digital identity. The combination of these two keys ensures the identification of the person and thus allows him to sign his transactions on the blockchain.

But these keys alone are not enough, it is also necessary to have a distributed and decentralized network. That's good, Blockchain technology works on this principle!

Let us first explain why such a network is important to guarantee transactions. Everyone knows the story of the sound of a tree in a falling forest. If there are witnesses on site who can record the sound of this tree falling, they will be able to report that it did make a noise when it fell, with supporting evidence. But if no one is present to see, anyone can dispute this fact.

The operation of Blockchain is based on this principle: it is necessary that several people see for themselves the transactions and come to an agreement. Obviously, we are not talking about people scrutinizing all the transactions one by one. In this distributed and decentralized network, each user is also an actor!

All the computers belonging to the network (the nodes) participate in the many calculations generated by the combination of the keys mentioned above and this network: the famous blocks of the blockchain. During a blockchain transaction, a block is created containing all the necessary information: time, description and private and public keys. This block is then distributed to all the nodes of the network which will then ensure that everything is compliant. If so, the block is validated and integrated into the chain.

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