Mini Crypto Program Part 3 || "Understanding of Blockchain", by @prudence1

Good day, Steemians!

It's yet another day for us to work on Blockchains, and I hope you will find this write up beneficial.

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What do you know about blockchain?

A blockchain is a distributed and decentralized ledger that is used to record digital assets. It also records blocks of data that are encrypted and chains them into groups in order to form a single source for a particular data set. Blockchain has the purpose of solving the double record problem without the need for a central server, and it is also the technology that is behind Bitcoin.
Transactions are recorded in the blockchain with a cryptographic signature which is termed as a hash, and when a single block in the chain is changed, it will be known that it has been tampered with.

Describe one type of blockchain!

Public Blockchain

The public blockchain is a type of blockchain that is publicly open and can be joined by anyone without the requirement of specific permission.
Some cryptocurrencies (Bitcoin and Ethereum) use the public blockchain, which makes them get the most attention. Problems like transparency and less security that come with centralization have been removed by the public blockchain.

Explain the advantages and disadvantages of the type of blockchain you choose!

Advantages of Public Blockchain

• The public blockchain is completely independent. The public blockchain can still work even if the organization that started it does not exist anymore, since it is an independent organization in as much as computers are connected to it.

• Data is secure in public blockchain because it cannot be changed once it is validated on the blockchain.

Disadvantages of Public Blockchains

• Public blockchains such as Bitcoin are too slow, which is why they manage to process seven transactions per second.This is because it delays a consensus being reached by the network.

• Public blockchain consumes a lot of energy. As the algorithm of Bitcoin relies on Proof-of-Work, which also relies on the use of a lot of electricity to function.

Visit Blockchain Demo, and what did you learn from that page? (screenshot required)

After clicking on the Blockchain Demo link, I got to observe the following;

Hash

Hashing is used in the blockchain, as shown in the screenshot below. It turns an input into a string of bytes with a fixed-length character string.

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Block

The block consists of a hash of the previous block, the transaction data, and a timestamp. Also, the first block in a blockchain is termed as the Genesis Block since it is the only block with no data on the previous block.

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Blockchain

The blockchain is a data structure that holds the records of transactions in a form of blocks which are controlled by several authorities. Its main objective or goal is to enable the recording of digital information and the distribution of it, but not edit it.

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Distributed Blockchain

The distributed blockchain uses nodes to record, share, and synchronize transactions in their respective electronic ledgers.

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Tokens

The tokens are ordinary assets or access rights or even both. They give permission or ownership to a user and vary significantly depending on the blockchain type or distributed ledger.

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Coinbase Transactions

The coinbase transaction can only be created by a miner and it also rewards miners with the block reward for their work.

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Explain the advantages and disadvantages of using blockchain technology!

Advantages of Blockchain Technology

• It does not require third-party interference. No one (including governments or financial institutions) has control of the cryptocurrencies that are based on blockchain technology.

• Transactions are done instantly. Transactions in blockchain technology are done in a few minutes.

• Transactions on the blockchain are traceable. Unlike other complex supply chains, where it is hard to trace products back to their origin. The exchange of goods is recorded on the blockchain, which makes it traceable to where a particular asset came from.

Disadvantages of Blockchain Technology

• Privacy

As data on public blockchain is encrypted and anonymous, and everyone in the network has access to the data, someone could track down the identity of a person in the network through transactional data.

• Scalability

It is getting a bit harder to try to practice the use of blockchain. The node of each participant needs to verify and approve a transaction, making one Bitcoin exchange take up to several hours.

Conclusion

Blockchain has the purpose of solving double-record problems without the help of a central server, since it is a decentralized system and a distributed ledger. It also records blocks of data that are encrypted and chains' them together to form a single source for a particular data set.

I would like to thank prof @liasteem for the hard work done in providing the notes.

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