The blockchain is… the Essence and the future of the technology

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Highlights: What is the blockchain? How does the blockchain? What are the analogues of the blockchain? Why the blockchain in a cryptocurrency? Where else apply the Blockchain? Aragon Sia Bitshares The drawbacks of the blockchain Are there prospects for the blockchain? Who has heard of bitcoin and cryptocurrencies, faced with the concept of the Blockchain. Many do not understand or are unable to understand what it is, why you need and how it works. Below in simple words we explain the principle, and consider opportunities outside of digital currencies.  What is the blockchain? Simple blockchain is an infinite chain of blocks that stores certain information. It is possible to record not only financial values, as some believe, but also any other value. So can function a digital currency or any alternative project, where the basis based on the continuously generated database. The advantage of blockchain security at the level of formation of the database. The concept has seen the world in 2009. The Creator of the first cryptocurrency Satoshi Nakamoto introduced the idea implemented in bitcoin. Since the technology evolves and finds application in large number of fields. Develops and cryptocurrency market, which presents more than three hundred altcoins. 

How does the blockchain? Imagine a huge number of people with logs that simultaneously record the same information and re-examine it from each other. How it works the process of forming the circuit. The info is transferred using P2P networks. They are known to many on the torrent tracker. In each block except for the basic information stored timestamp and content about the previous one. Everything is encrypted using cryptographically algorithms. Thus data storage with a number of huge advantages: – Protection. Due to the constant checks of materials connected to each other, and duplicated a huge number of network members, the possibility of substitution of any part of the circuit. This piece will be immediately eliminated and removed; complete transparency. Any member of the network may verify the transaction processed in the system. – Decentralization. The concept is no Central storage server. All the multiple copies is kept by the members of the network. – Confidentiality. Everything inside is encrypted. So you can monitor the transaction but without private key you cannot determine the sender or the recipient. To ensure the functioning of the blockchain of the chain and its reliability, uses several methods of mining, PoW (Proof of Work) / PoS (Proof of Stake). 

What are the analogues of the blockchain? The above-mentioned technology of distributed registry became the most popular, but there are bottlenecks. Try to solve them the developers analogues. The most famous of now – Hashgraph, TraceChain, Tangle. Everyone is trying to solve a problem that is not possible using Blockchain. Of the key benefits is the ability to handle multiple chains of transactions and function without additional equipment, for example, it is necessary for mining. The solution of such tasks increases the speed of operation of the network and its mobility. While all the alternatives are under development and testing. The blockchain has long been at the stage of introduction and development of the market. By the way, this level of anonymity analogues could not be reached. And this is the key factor that influenced the popularization of TRR and cryptocurrency in General. Plus in the most popular technology PP, constantly develops tools EOSIO to combat bottlenecks. This helps to retain the advantage of scale. While alternatives do not look as competitors, but rather as a complement that can coexist with the leader of niche. 

cryptocurrency

Why the blockchain in a cryptocurrency? This is the basis, and in principle there is a “crypt”. In the process of forming the circuit are produced tokens as a reward for mining. They have value and represent a digital currency. Without the need to form a chain, didn’t need mining and, accordingly, there would be no tokens. In projects by type of bitcoin, with the main objective is to implement a decentralized alternative currency, content, consists mainly of financial data. Balances cryptocell, information about translations, of the Commission. Users have taken to each other the crypt and thereby contribute to the formation of subsequent blocks. This format is convenient for many due to the anonymity and reliability. Losing money can be giving criminals private key. Another way to steal currency is impossible. By the way, bitcoin is not completely anonymous crypt. Though there is no binding of the individual to the wallet, lots of functionality, by which a person installs effortlessly along the chain of transaction from wallet to wallet. Those interested in complete privacy, uses of cryptocurrency that was created to solve a specific problem. For Example, Zcash For. 

Where else apply the Blockchain? Given the revolutionary nature of the technology and its simplicity, it is already being implemented in various fields. To give some examples. Aragon Provides the opportunity to ensure the operation of the company, completely eliminating the bureaucracy and paper documents. In digital space there is absolutely everything: – the voting process based on smart contracts; – distribution of shares of the company and management; – formation of the staff; – fundraising (raising funds that are used for business development). Is in the process of development and testing by small innovative companies. 

Sia Cloud storage decentralized type. In the usual “clouds” of type Yandex.Drive or Google Drive content is stored on specific servers. In the case of Sia, in encrypted form, they are parts stored on the devices of the network participants. So the probability of file loss is minimized. To disappear from all media they can’t. Simplistic works like this: – create a node from the owners of the computers that provided a portion of the disk space to rent. Stable operation of the channel and the safety of files and increase profit. – Clients issue a paid subscription and get the ability to upload files to a distributed network. They are split into blocks, encrypted and duplicated many times, to avoid loss of information flooded in the network. – The owners of the GBR are rewarded on completion of smart contracts. The income is given in the cryptocurrency Siacoin. It is traded on many major cryptomeria and is estimated at $0.002 per coin.  Bitshares Another interesting project. It is called bloccano the third generation. Tokens are used as proof of right to possession of the object, including in the real world. Now Bitshares is used to sell real estate and to track the change of owners. Plus the fact that so specifically excludes manipulation of documents when a house or apartment “copied” on the nominees. 

The drawbacks of the blockchain The main problem of the technology and its bottleneck is the scalability. Sorry, not yet implemented the ability to provide a really large number of transactions in a short period of time. Comparing with payment systems Visa and MasterCard have a capacity of 45,000 transactions per second. Bitcoin provides only 7. But it is fair to say, for crypto projects, the basis of which the digital currency, the problem of scalability is in the first place. There is no doubt that soon this issue will be resolved. Another negative point – the daily increase in the weight database, and the growth of computing power required to operate the Blockchain. As a result, increases the energy consumption that is needed for such tasks. This is bad from the point of view of ecology. There is still a risk from the security. The so-called “attack 51%.” Briefly, concentrating in the hands of more than 51% of computing power, you can control the network confirming the selected transaction. Fortunately, the attack 51% is virtually impossible. To make you need a lot of resources and yet — it is simply economically unprofitable. 

Are there prospects for the blockchain? No doubt the Blockchain is one of the most revolutionary technology since the creation of the Internet. Its application can not only facilitate and speed up many processes, but also to make them more secure. The most striking example is the use of TRR for the elections. In this case, it is possible to achieve a fair transparent voting completely excluding the possibility of fraud. It was repeatedly mentioned and development underway in many countries. Many techno geniuses like mark Zuckerberg and Pavel Durov interested in the development sector and even the creation of its own cryptocurrency. 

Well, to dispel any doubts about the fact that this is the future, we will note just a couple of weeks ago, Chinese President XI Jinping said the need to accelerate the development of Blockchain and increase the volume of investments in this direction. The next day passed the law on regulation and promotion of earnings in the field of cryptography. At the moment, was more than five hundred blockchain projects from large Chinese companies such as Alibaba Group, Tencent, Unionpay and others. If China seriously took this direction, it means exactly in this are tremendous prospects. And while the technology appears in a wide variety of niches, the cryptocurrency market have already been formed at a sufficient level to use it as a financial trading tool. As in other markets, has its own peculiarities and without preparation there is a huge risk just to drain the budget. At least, it is impossible to trade without a clear algorithm, so we give You access to 9 free algorithms from Alexander Gerchik! A good trading!

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