What is blockchain and how does it work

Block Chain Technology (BCT)

 The term “blockchain” was coined in 2008 by Satoshi Nakamoto, who published the original whitepaper for Bitcoin. The paper described a peer-to-peer electronic cash system that would allow online payments to be sent directly between two parties without going through a financial institution.

How does it work:

Blockchain technology is something that’s been around ever since the internet first started. However, its recent surge in popularity can be attributed to the fact that cryptocurrencies have become extremely valuable over the past few years. Many people aren’t fully aware what blockchain actually does, so I thought I would make a video explaining how it works at its core. If you already know about it, then great! But if not, keep watching to learn all about the basics of Bitcoin & Ethereum and why they're so special.

 For those who don't already know, Blockchains are digital ledgers that record transactions. They are able to do this without a centralized third party by being decentralized and adding blocks (also called records) to the database. Each block contains an encrypted timestamp and link to the previous block, making it difficult to tamper with data through complex computing power. Blocks also contain valid information and are treated as permanent fixtures of the ledger. In order for these transactions or blocks to be added, the network requires that users solve a series of mathematical puzzles, referred to as hashes, that verify the integrity of each transaction. These puzzle solutions are also recorded permanently in the blockchain. As long as everyone follows protocol of the system, blocks cannot be changed once added, allowing trustless verification of each transaction.

 Blockchain's use cases go beyond simply having a secure way of transferring value between two parties. Blockchain technology allows us to securely store any kind of information, providing complete transparency.

 To understand the implications of this, just think about how we send money today. We physically mail checks, which are then redeemed in our banks, where the funds are cleared before being credited to our accounts. On top of that, many services offer credit card numbers as cryptographic keys that only work if they receive a physical signature. Unfortunately, there's always a possibility that someone could intercept these things along the way, causing our financial information and currency to be compromised.

 Blockchain changes everything. Instead of using a centralized server to check and redeem, we would use a distributed network to validate the transaction. Because we no longer need to entrust our information to others, we can create secure online identities that can be controlled privately instead of relying on government-issued credentials.

 In short, blockchain is incredibly powerful when applied correctly. It creates trustlessly immutable ledgers of data that no single entity controls, allowing for a completely transparent future of finance, business and government.

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