Block-chain is the new cryptography technique that is going to revolutionize how value is exchanged. It uses a distributed ledger system that ensures complete data reliability and is inherently tamper proof. Till now the internet has been used very effectively to share information, to some extent almost replacing formal institutions like universities as the primary source of knowledge for the public . However value, money etc. has traditionally been transferred using a mediating authority like a bank or government. Bitcoin is changing that, and the underlying technology known a Block-chain is having a profound impact on how value is handled. Crypto currency, is the most obvious use of Block-chain technology but Block-chain itself is proving to be useful for all sorts of jobs that require a secure permanent ledger.
This is how it works. Every computer that is a part of the network has an encrypted copy of the ledger called a block. Any change to the ledger, gets approved encrypted and recorded into every single block that’s part of the network, forming a block chain. This way even if a few computers on the network get tampered, destroyed or hacked the ledger still remains reliable. The bigger the network is, the more secure it gets. Banks, Law firms and Hospitals are some of the first adopters. These institutions require a very reliable method of keeping records and Block-chain is the perfect solution.
The main advantage of the Block-chain is the lack of a central server, however some very complicated calculations have to be carried out when changes are being made to the ledger and this requires large amounts of processing power which in turn requires energy in the form of electricity. Currently for Bitcoin, users can lend their computer’s processing power to the network in exchange for a small amount of bitcoin, these are called Miners. In recent years mining has been taken to another level with hundreds of acres of processing farms being operated by individuals, large corporations and governments. This may be the main limiting factor to the wide adoption of Block-chain, but with recent advances in graphics card technology, it has become a more realistic proposition.
One thing is for certain, in the very near future, you will be using Block-chain technology as an integral part of your everyday life without even realizing it.
-Triman S Bhullar