WHAT IS BLOCKCHAIN AND HOW BLOCKCHAIN WORKS
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Step 1: Blockchain is a group of blocks linked together, forming a distributed ledger. Whenever a transaction is requested, the technology forms a “block” suggesting a transaction has been made. This block contains proof of record of the transaction and the participants public identification known as public key. |
Each individual in the network will have their own mathematically combined keys known as cryptographic keyscalled private key and public key. This is to ensure security and traceability in the transaction. A private key grants the individual the authority to access or in technical terms decrypt theinformation sent using the public key. Only that individual has access to that private key. On the other hand, a public key serves as a public email address which other participants can send information to Massessi, M. (2018). |
STEP: 2
Each generated block contains reference of the previous block known as the parent block, therefore if the information in the parent block changes, information from all other succeeding blocks changes too. This makes the blockchain technology difficult to hack as it requires a large network of supercomputers working simultaneously to hack every single block in the blockchain network (Zheng et al, 2017). |
STEP: 3
Once the transaction is validated, the block is added to the chain and the transaction is completed. What made it attractive and popular especially in business enterprises is its key characteristics; Immutability, Transparency and Decentralization. It allows a fast, efficient and secure private or public exchange of assets and information directly between peers without any intermediaries. BIBLIOGRAPHY: Daniel (2019). How Do Blockchain Networks Validate Data? - ICO.li. [online] Available at: https://www.ico.li/blockchain-validate-data/Accessed 10 Feb. 2020]. Massessi, M. (2018). Differentiating between the Public and the Private keys. [online] Medium. Available at: https://medium.com/wharfstreetstrategies/differentiating-between-the-public-and-the-private-keys-cfe096179b6[Accessed 12 Feb. 2020]. Swan, M. (2015). Blockchain economics. 1st ed. Sebastopol: O'Reilly Media, Inc. Zheng, Z. et al. (2017) ‘An Overview of Blockchain Technology: Architecture, Consensus, and Future Trends’, 2017 IEEE International Congress on Big Data (BigData Congress), Big Data (BigData Congress), 2017 IEEE International Congress on, BIGDATA-CONGRESS, pp. 557–564. doi: 10.1109/BigDataCongress.2017.85. |
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