Blockchain technology is for transaction-security improvement, server-logic decentralization, Open Ledger, reduced operating costs and crypto-blocks implementation. This is already proven and implemented technology in realtime businesses like BitCoin, LiteCoin, Ethereum (cryptocurrency) etc where the block chain technology is implemented in full range and in Live.
In layman terms, any organization ( users in organization like bank) which triggers a huge number of transactions in general possesses a centralized server which handles all those transactions and all users ultimately will have to hit the central server for each and every transaction. In this business-scenario there arises issues associated with security and speed while completing the transaction cycle. When ever there is a single point of enquiry ( central server) there is always a high risk and chances of security breach could come into front-row as an unmanageable risk-factor daemon. As now all the business-components are gradually getting converted into distributed mode, so the security to be provided perhaps multiplies, also because of data distribution. Using blockchain, a super-security is guaranteed and achieved even in complex distributive mode which is almost maintenance free and also profitable to the end user. Companies which adopt this technology along with Bigdata, can reduce their operating cost exponentially.
The Blockchain is a secured chain of transactions in a linked commodity-hardware, is shared by all users in a secured way in each and every transaction being held in a distributed network. Blockchain uses a technology by which data is transmitted in a complex logical format which can be read and processed only by the intended end users.
How Blockchain Works
For each and every new transaction originating from a user, a mathematical private key or seed is generated. This cryptographed key is used to sign transactions, providing complex algorithematic proof to the block showing that they have come from authorised user.
Problem Now : If a person X in some gobal geographycal location whats to send money to Person Y in another geographycal location , the transaction is done using a third party which is identified by both person X and Y. And generally for doing so it required some transaction time (say 1 business day) and transaction fee ( say $0.1). Using block chain this third party gateway can be completely removed so could save time and money of each individual user.
For the above problem, blockchain has incredible solution which is profitable to both origin-organization and also to the end users. It uses a concept called Distributed Open Ledger using a chain of transactions over the open network.
If Mr. X wants to send money to Miss Y and P,Q,R and S are other users in the network. When X tries to send money to Y say $5 ( where X as $10 in his account), an open Ledger is being created and everyone else in the network has crypto access to the generated open ledger and each transaction is added as a new open block to the already existing Ledgers which X has made ( now X has 10-5 = $5)
There is no centralized database now…. So who will Validate these transactions..
The answer is there will be special nodes in the block chain example P and Q, they are called as minors. These minors, as soon as a new transaction is placed will compete among themselves to validate the translation ( how much X has and and how much he can send and whether this transaction is valid or not). The minor which validates faster will gets first chance to add a new validated transaction block to the chain and it also rewarded. Each minor’s calculation will be crosschecked in parallel and matched with results of other competing minors. Finally new ledger block is added to the existing chain once validation of the transaction is done. This complete process will be executed in a couple of nanoseconds. As there is no third party here, transactions will be done almost immediately and as the ledger is open there are many simultaneous security checks imposed on each and every transaction to process it and to commit it ( this is done by different minors), so a surety with respect to ultimate security could not be broken by by any means in blockchain
–How to implement Blockchain with coding example we will check in far upcoming technology sessions
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