If you are one of those who think that Blockchain and Bitcoin are the same or on the contrary you are aware of the fact that Blockchain and bitcoin are closely interrelated but they are not the same, this article is for you.
Blockchain is far more than a platform for a currency, it is a platform for decentralizing the web of applications in a profoundly secure way. The Blockchain developer conference is the largest convergence of Blockchain developers seeking exposure to the newest technologies for building decentralized apps in FinTech, Healthcare, Government, Enterprise, and the Consumer space.
What do we mean by Blockchain technology?
In plain language, a Blockchain is a computer file specifically designed to store sensitive data. Whereas, in more technical terms, a Blockchain is a distributed ledger or database, which means that the data within the blockchain can be viewed using many computers, indicating that it is decentralized. The concept of Blockchain is new in the world of technology and the decentralized data system makes the process unique. Previously, databases used to be centralized, which means that they remain under the direct control of a single entity, which can be the government or another body. Technology has changed over the years, so with Blockchain decentralized databases have been introduced that can be viewed with the permission of all users. It is a method of translucent nature, which is totally protected. This security is because hackers don’t know where to attack, since the data is handled by many different users.
If we talk to you about the terms decentralized and distributed, you will surely think that this refers to bitcoin. Well, something like that. Bitcoin is a digital currency that is decentralized, and uses a distributed process whereby people transfer bitcoins without the intervention of third parties and with anonymity. Bitcoin is a simple example of a cryptocurrency. Therefore, it can be said that Bitcoin makes use of Blockchain technology to transfer digital currencies, but Blockchain is a much broader concept than Bitcoin. The technical terms are interrelated but they are not the same.
If Blockchain is not only used to transfer cryptocurrencies like bitcoin, what other uses does it have?
A chain of blocks or Blockchain has a much broader application than bitcoin and is much more than a network of cryptocurrencies. The concept and application of the blockchain is so broad that it is not yet fully understood that in a short time the business world will be revolutionized thanks to the Blockchain, just as the Internet did at the time.
Execution of smart contracts
With the help of Bitcoin, people are realizing that Blockchain brings seamless execution to digital transactions and also brings legal status to digital relationships. Smart contracts help in the automation of transactions that are sent only after the terms of the contract have been fulfilled. This saves a lot of time, as well as resolving any type of discussion quickly. Smart contracts can be implemented in business processes, logistics, supplies, etc. To guarantee compliance with the terms of the execution of the agreements by eliminating any intermediary and guaranteeing that all transactions are safe and secure.
Distributed and transparent database records
Blockchain is a distributed ledger technology where each node gets its own copy of the ledger. Every time someone adds a new transaction, all copies of the record are updated. Blockchain does not require a central authority to manage the data. In fact, it is completely decentralized. There are strict security protocols that require computational trust. Blockchain organizes data in terms of blocks, hence the name. These blocks are linked together and encrypted for security.
Blockchain only allows adding operations, that is, you can add new data, but you cannot alter or delete existing data. This is an aspect that distinguishes it from traditional databases. Since you cannot alter or delete a single block of data, every transaction that exists in history is immutable.
This makes it one of the most transparent technologies, especially for the financial industry.
Supply chain analysis
With the help of Blockchain records, the purchased goods can be traced by the customer. For example, if an e-commerce company is using a blockchain network, with its help, the company can keep track of which products have been shipped from the warehouse, which products to which location? Any customer can check the validity of the shipped product with the help of records stored on an immutable and secure network.
In addition to these uses, we have advantages such as:
- Security in financial transactions
- Data cannot be falsified
- Information is never lost
- Anonymity for users
- lower cost
In conclusion, why Blockchain and Bitcoin are two completely separate things:
- Bitcoin is a cryptocurrency while Blockchain is a distributed database.
- Bitcoin is powered by Blockchain technology, but Blockchain has found many uses beyond Bitcoin.
- Bitcoin promotes anonymity, while Blockchain is about transparency.
- Bitcoin transfers currency between users, while Blockchain can be used to transfer all kinds of things, including information or property rights.