Blockchain Technology and How Does It Work in The Crypto World

Blockchain Technology and How Does It Work in The Crypto World - What is blockchain technology and how does it work in the crypto world? we will explain you through this article. The popularity of cryptocurrencies / cryptocurrencies has skyrocketed in recent years, this is certainly influenced by many factors. Similarly, is there a Blockchain term in this crypto-digital transaction, what is Blockchain and how does it work?

For those who are still new to the crypto world, discussions about understanding the blockchain before the road definitely need to be clarified so that in the future it can be more understandable when conducting cryptocurrency transactions such as Bitcoin or Dogecoin.

What is Blockchain ?

Blockchain is a distributed and decentralized ledger that functions as a registrar of digital assets and data that cannot be changed. The information can also be provided by anyone who wants to see it.

Blockchain is also often referred to as distributed ledger technology (DLT), where the information about digital assets recorded there cannot be altered and is transparent (available to anyone who wants to see) via decentralization and cryptographic hashes.

A simple example to understand blockchain technology is Google Doc. When you create a document in Google Doc and share the link with a group of people, it is distributed, not copied or shared. They create a decentralized distribution chain that allows everyone to access documents at the same time. No one is blocked from waiting for changes from third parties, while all changes to the document are recorded in real time, which makes changes completely transparent.

But the bottom line is, the way blockchain works is more complicated than Google Doc, but its analogy is just that. So, it can be said that blockchain technology is very promising and revolutionary because it can help reduce the risk of fraud as well as provide measurable transparency for several purposes.

How blockchain technology works ?

How does blockchain technology work? Actually Blockchain consists of three important concepts, those are block, node and miner/miner. We will explain you what are those things.

1. Blocks

Each chain consists of several blocks, and each block has three main elements:

  • Data block.
  • A 32-bit integer is called a nonce. The nonce is generated randomly when the block is created, resulting in a hash of the block header.
  • A hash is a 256-bit number that is entered into a nonce. Start with many zeros (that is very small).

When the first block of its string is created, the nonce generates a cryptographic hash. The data in the block is signed permanently and bound with a nonce and hash if not mined.

2. Miner

Miners create new blocks in the chain through a process called mining. In blocks, each block has a unique nonce and hash, but it also refers to the hash of the block in advance in the chain, so mine blocks are not easy, especially in large chains.

These miners use special software to solve very complex mathematical problems to find asymmetric numbers that produce acceptable hashes. Because the nonce is only 32 bits and has a hash value of 256, there are about four billion sets of nonces that must be mined before the correct set is found. When this happened, the miner allegedly found a “gold mark” and his mass was added to the chain.

3. Nodes

One of the most important concepts in blockchain technology is decentralization. No computer or organization can have such a chain. Conversely, it is a registry that is distributed throughout the nodes that connect to the chain. A node can be an electronic device that stores a copy of a blockchain and supports network functions.

Each node has its own version of the blockchain, and the network must algorithmically validate each block that is newly mined in the chain for renewal, trust, and verification. Because the blockchain is transparent, every action in the ledger can be verified and viewed easily. Each participant was assigned a unique alphanumeric identification number that identifies his transaction.

The combination of public information and verification systems and blockchain balances help integrity and build trust among users. Basically, the blockchain can be seen as the extension of trust between technologies.

Learn also knows how the history of the blockchain has stood since the beginning of 2008 and how it evolved into a confidential data exchange tool with unlimited use.

Provided by teknobgt

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