Introduction
Blockchain is the term that we are frequently hearing now days. It all started with revolutionary concept of bitcoin and soon took a place in the mainstream business functions. Blockchain has successfully passed the infancy stage and it all ready to be used in full-fledged business operations. Earlier the usage of blockchain was restricted to the financial organizations.
Though cyrptocurrency was the initial favorite use of this blockchain the technology is soon taking a revolutionary turn by getting into all the leading industries. The blockchain application allows the consumers to avail the information about the various products they have purchased. In case of any discrepancy or malfunction the customer service teams always ready to help. This makes it apparent that blockchain have broken all the records and have successfully entered the mainstream business functions in various industries in order to prove its worth and usability.
How does it Work?
To get an idea about how the blockchain functions, it is important o understand the concept of bitcoins first. Bitcoin is basically a digital money or currency which takes the form of thenational currency according to the country. The role of blockchain here is to maintain a ledger or a file that will store the total number of bitcoins a person owns. It is an online application which keeps a track record of all the bitcoin transactions held with the help of interconnected systems.
The main file is not stored on the central server. This is the USP of this application that it is a completely decentralized system. The main ledger file is dispersed all over the world. It is saved on the personal computer systems of the people to store the important transaction data and perform complicated calculations. For example, is A wish to transfer 5 bitcoins to B he a broadcast message will be sent to all the nodes of the personal computers. This will showcase that A’s bitcoins will be reduced by 5 and B’s bitcoins will be increased by 5.
Blockchain is an application that allows every person to monitor each other’s transactions. You are not compelled to trust any entity or person for computations. Instead of it some special mathematical formulas, functions and important codes are enabled in order enforce reliability and security. Every person has a personal wallet which he needs to operate and maintain on his own. There is certain cryptographic technology that has a distinct and unique combination of keys that is involved in protecting every wallet. These keys will be for both public and private transactions.
Benefits of Blockchain
Blockchain is a revolutionary addition to the mainstream business operations. Let’s have a look at some of the benefits of the blockchain:
Transparency – Blockchain makes the transaction history open to every person associated with it or has an access to it. Blockchain is basically a type of ledger or file which is distributed on the nodes of personal computers. So in case of any changes in the transaction history is notified to every person having an access to it. By making all the information available to everyone, blockchain is one of the most transparent systems till date.
Security – Blockchain has been voted as one of the most secured transaction record keeping system. The common or shared info on the system can be modified only on a mutual consent of all the nodes associated to it. If majority of the odes approve for the changes then only the info is updated. Every transaction is properly encrypted and has duly connected with original transaction. In other words a single person or node alone cannot edit any information present on the blockchain.
Efficiency – With manual transaction recording paper processing and calculation become a third party process. This is also prone to many human errors. Blockchain can discipline and streamline the traditional methods and eliminate the risk of errors. This makes the entire system faster and efficient. There is a single document and this eliminates the need for maintaining multiple transaction files.
Traceable – In this complicated supply chain system, it is almost impossible to track the past transaction. This makes the entire process prone to errors. Blockchain has the ability to streamline all the operations in such a way that tracing the past transactions. In this every transaction is recorded with the exact date and time. An audit trail will help the parties in tracing the current position of the product.
Conclusion
Apart from these benefits, blockchain has a high auditability as well. As and when a transaction takes place, it is well recorded in the system. An audit trail is available for you to check and analyze the transaction. It is a very cost effective system as it eliminates the role of third party functions. We hope you have acquired a fair amount of knowledge by this write up.
