So, You’re reading this article because you’re curious, you’ve been hearing about Blockchain Technology, Bitcoins, Cryptocurrency and some other strange terms but you don’t have any idea what it is. Well, I’m about to clear that up in this article. And, In this article, I’m going to make it as easy as possible to get exactly what I’m talking about. So, let’s get right into the article… Shall we?
What is Blockchain Technology and How Does It Work?
So, Blockchain Technology and everything I’m going to be explaining in this article is basically like this. Imagine you want to sell of your laptop, you’ll need to use a platform like Amazon. This platform serves as a link between you and the person you wish to sell your product which is your Laptop to over the internet. Now, the person who is going to buy the laptop is going to pay through a bank service before the money gets to you right? Well, due to the Blockchain technology, you wont need the Bank anymore. You can transfer the money directly to the buyer anonymously.
Blockchain is a Network of computers which all have the same history of transactions stored on them. It has no central point since all information is stored on many computers at the same time which makes it hard for anyone to just steal information. And all transactions are encoded using a method known as Cryptography.
The Blockchain doesn’t just record just Cryptocurrency transactions alone so, you should note that Blockchain isn’t only about Bitcoin alone. Bitcoin is just a digital currency created using the Blockchain Technology. It can also be used to record music, people’s identities, money and lots more. So, if anyone attempts to change the data on the network it’ll spoil the code and everyone would immediately know about it which makes it very secure.
What is Bitcoin and How does it relate to the Blockchain Technology?
Bitcoin is a Digital token that isn’t physical. Meaning you can’t see or touch it. It just exists on the internet with it’s own monetary value which fluctuates all the time. Now, we said the Blockchain is used to record transactions right? Like Bitcoin transactions and we also said that it’s decentralized which means that no entity can control or regulate it right? Which means it works on P2P terms. Every transaction is basically just between the person sending Bitcoins and the person receiving them.
So, like we said before nobody can tamper with the Blockchain, meaning that when transferring Bitcoins, you don’t go through the risk of your money being diverted. It goes directly to whomever you wish to send it to through the secure Blockchain technology which makes it very secure and also very transparent.
Benefits of Blockchain and Bitcoin?
Now, we want to talk about why people keep getting into Bitcoin day by day and why the Blockchain technology gained so much attention since its inception.
- Anonymity: When transacting using the Blockchain technology, to transfer digital tokens from one person to another, you only get an address which looks something like “0xa65bBE1bfbC713b2607F8d25A8e733CdB2Ed7650” which means you don’t know the identity of whomever you’re sending the digital token to. Users are able to control how they spend their own money without worrying about external parties like Banks knowing anything about it.
- Freedom: When transacting using the Blockchain technology, you can send any amount of money in digital token value without worrying about limits and you can also receive payments anytime and anywhere.
- Security: Like we’ve talked about before, one of the many reasons why people accepted the blockchain technology was because of it’s security since nobody can just tamper with it.
- Low transaction Fees for International Payments: Wire transfers and generally international money transfer methods often have very high fees. But with this technology, those fees have been reduced to a very low amount because of the non-involvement of the Government or other intermediary institutions. So, it saves money on international transactions.
- Easy accessibility: Bitcoins are very easy to purchase once you own a smartphone, an iPad, a laptop and other gadgets so, that makes it very accessible to nearly everyone at any time without the hassle of getting a credit card or other traditional methods of payment
- Peer-To-Peer transaction methods: Over the Blockchain network, digital tokens can easily be transferred from one individual to another directly without the hassle of passing through any regulatory intermediary like Banks. Which makes it a very focused method pf payment.
In conclusion, the Blockchain technology, Bitcoin and a number of digital tokens are here to stay and won’t be fading anytime soon. So, you can dive in and explore this new piece of technology. Try it out for yourself and educate more people on it too. I hope you enjoyed this article and it gave you a little knowledge on what the Blockchain technology is all about. If you don’t get something or, you think there’s something we need to add to this article, please feel free to drop it down in the comment section. Thanks for reading.