We have all heard of success stories of people who bought Bitcoin in the early days and later they made millions. Bitcoin has reached highs of over $7000+ (over 700k Ksh) for just one coin. Bitcoin or one of its competitors could very possibly be the next global currency of the world, in the future. Bitcoin is certainly an interesting new force in our world and whether it becomes it becomes a new global currency or it crashes into digital abyss, there is something even more interesting than bitcoin. This technology will unquestionably change the world beyond recognition.
I am talking about the very technology that makes bitcoin possible, BLOCKCHAIN. Blockchain is so much bigger than bitcoin. Bitcoin is simply the very first adopter of a revolutionary technology, which is going to change our world. In the same way the wheel, the printing press and nduthi did.
The idea about blockchain was first described in 1991 by a group of researchers. But it wasn’t until a mysterious guy or a group of people; well no one knows for sure their identity. Under the pseudonym of Satoshi Nakamoto used this idea in 2008 to create Bitcoin, and blockchain finally became a reality.
A blockchain is a ledger of financial accounts but digitized and decentralized. And this decentralization is from where its power and immense security is derived. Each block contains data based on whatever the blockchain is being used for. In the case of cryptocurrencies like Bitcoin, each block contains a list of transactions that have occurred including the person who sent the bitcoin, the recipient and the amount.
A single block is by no means secure, because the data can be easily tampered with. To vastly simplify things, a hacker could simply change the amount of a transaction to be more than it actually was to fraudulently extract more funds from the system. But when you have more than one block, they are linked together by a virtual chain. The subsequently linked block will always contain a unique finger print of the previous block. This is known as a HARSH.
If a single byte of data changes in the previous block, so does its unique fingerprint or harsh. And so the subsequent linked block is no longer valid. Also every single of a block down the chain is now invalid too. This could be many thousands of blocks and millions of transactions. This mechanism adds significant security to the whole system and makes it almost tamperproof, but not quite. Because modern computers, can easily change every single harsh along the entire blockchain within milliseconds, so then the entire chain would be fraudulent. But it would still show as valid.
So the bitcoin blockchain and all other modern block chains have something called a proof-of-work fail safe. Which means that any adjustment to a single block must be slowed down often taking ten minutes or more to accomplish, increasing the security. This is because hackers don’t like time throttling of any kind. Also every single data alteration must be backed up with a proof-of-work. It’s just like in school when you got a marking scheme then the teacher asked you to show your formula to the answer. This is how some of you had to take thorough beating because you couldn’t show your workings.
Lastly, what makes blockchain so immune to tampering, fraud and hacking is the fact that it is completely decentralized. No single person, organization or server, controls or dictates a blockchain network such as Bitcoin. Blockchain is collectively stored and replicated on mass on a peer to peer network. Similar to BitTorrent, but unlike BitTorrent which has a centralized tracker, no one centralized server or corporation tracks and controls who has what data on the blockchain. Instead everyone on the network, which could be thousands or even millions of people, has an exact replica of the same data file or blockchain. So its integrity can be verified. Everyone on the network has to have a record of the entire blockchain, all the way from its inception. Meaning everyone in the blockchain network such as bitcoin has a record of every single bitcoin transaction that has ever happened.
Hacking nowadays has been the norm of the day. Big corporations, banks and even social media is being hacked. If you think your data is safe, you’re terribly mistake. However if more companies that are responsible for maintaining large amounts of data, were to properly adopt the blockchain system to store their data in a global distributed and decentralized network. Chances of that data ever being hacked would be near impossible. And just because your data will be distributed in public to for everyone to see on the blockchain, it doesn’t mean that the world can actually view its content and see your Mombasa Pictures that you took with your clande and ben 10.
Data contained in the blockchain network can be and is often cryptographically encrypted. Thus the data can still be checked and verified by the world without ever being viewable. Except by its owner and those its owner selects to see.
The potential uses of blockchain technology are far and wide. And this is why, Blockchain technology is the new wheel of the 21st century. Watch this space.
Thank you for reading
