6 Basic Characteristics of Blockchain | Power of Blockchain Technology

6 basic characteristics of blockchain, what is Blockchain, characteristics of Blockchain, power of blockchain technology. 

 

BLOCKCHAIN | In this page today, we are going to talk about the six basic characteristics of Blockchain. But before we go further, do you even know what Blockchain is?

What is Blockchain?

Blockchain is a system of recording information in a way that makes it difficult or impossible to change, hack, or cheat the system. A blockchain is essentially a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems on the blockchain.

Blockchain.com is a cryptocurrency financial services company. The company began as the first Bitcoin blockchain explorer in 2011 and later created a cryptocurrency wallet that accounted for 28% of bitcoin transactions between 2012 and 2020. Wikipedia

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6 Basic Characteristics of Blockchain

Here are the 6 characteristics of Blockchain

1. Demediation

As a trusted third party in the real world, intermediaries have become an indispensable trust guarantee institution in transactions. Due to the core technical design, such as the consensus mechanism of blockchain technology, the entire information transfer is completed point-to-point (P2P) and the entire network confirms that the transaction is true and effective.

Achieving the de-intermediation effect of “intermediaries do not get a price difference” also greatly reduces transaction costs.

2. Maintaining the collective consensus

The consensus mechanism allows all nodes with maintenance functions to maintain the entire blockchain network. Relationships between nodes are the same.

Any node can have a general ledger for the entire network. Any node is free to add information to the block, which is recognized by everyone.

3. Trusted database

After the data is added to the blockchain according to the consensus mechanism, all nodes update and record the data. Ensure sequence relationships with timestamps and ensure data security through encryption.

In order to increase as the computing power of the whole network continues, the number of nodes in the whole network will continue to increase, and the difficulty and cost of tampering will become higher and higher. Although not all transmission information can be copied, realizing the complete reliability of database information is an important function to be an asset.

4. Decentralization

Decentralization is a key feature of blockchain technology. Based on distributed storage and P2P technology, the information transmission of each node in the blockchain is the same point-to-point, and data can be stored, recorded and updated according to the consensus mechanism.

5. Trustless

The block data structure stores and records all historical data, so everything on the blockchain is hacked and cannot be changed. When users process information through blocks, they only trust third parties to ensure the success of the information transmission, thus saving the trust cost of traditional transactions. Currency is the condensation of trust.

The cost of trust in sociology is much greater than in economics. Notary offices, courts, law firms, auditing firms and many other social institutions exist to promote social trust improvement.

However, having a trust institution means costs, whether borne by the state or by individuals. When it comes to blockchain technology, doing the right business has turned moral and legal problems into technical ones. Obviously, if the huge cost of social trust can be saved, it will lead to amazing overall social development!

The UK “The Economist” uses a “trust mach ne” to describe blockchain technology.

6. Anonymous

Based on asymmetric encryption and hashing algorithms, data exchange between each node in the blockchain network is performed according to fixed rules, and data exchange can be realized based on addresses generated by public keys instead of individual real IDs. Anyone can have an unlimited number of trading addresses because everyone can only transact via address, so you never know who your counterparty is.

Different digital currencies have different anonymity. Bitcoin has the most basic anonymity, so you can query the owner of the address to view all transfer records and assets for that address. Ze ash has the strongest anonymity, and only those with the private key of the wallet address can see There is. The transfer information for this address. It is because of the strong anonymity achieved by blockchain cryptocurrencies that Bitcoin has become the designated payment currency for many hacker networks.

Real-name authentication (KYC) for miners is required in many blockchain projects to facilitate management in multiple countries and to comply with laws and regulations of multiple countries. Blockchain can entail not only technology, but also human nature, society, and various national policies!

One of the Green Blockchain Cryptocurrency project you should know about is Pi Network

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