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What is Block Chain?

Blockchain is a technology where Bitcoin or other services are transferred from one individual to other individual successfully.

Bitcoin is a type of digital currency where record of transactions are maintained and new units of currency are generated by computational solution of mathematical problems also it operates individually to central bank.

Example:

If Person A need to send money to person B who resides in London, obviously Person A needs a help of a trusted third party e.g. Bank/Western Union etc, in this process it may takes nearly (1-3)days along with some extra charges. But using Blockchain technology this amount can be send to anyone or to anywhere who resides wherever in the world, it takes in minutes and transaction fees is less compared to Third Party charges.

Simply say with the help of mobile phones we can talk directly to our friends but through the same mobile if you want to buy something then you need a Third person who guarantees the seller that an amount has been credited. But is it Possible that buyer and seller would have an understanding without any Third Party. Blockchain is the technology which makes such transaction possible.

Block chain is a distributive database where data is stored in 100’s or 1,00,000’s of computers. Here data is encrypted and recorded in private basis.

Invention

Block chain is invented in 2008 S.Nakamoto(Pseudonym) invented this from Bitcoin service, to serve as public transaction  ledger of crptocurrency bitcoin.

Blockchain Technology

Block chain is such technology which acts a medium to send money to anyone wherever he may reside, without any help of banking sector. Block chain is started because of Bitcoin but new services are also joined through Block chain. It is an open ledger, where for any network the people who were connected with the network  knows well, who is the payer and payee and how much is to be paid. So no chances to tamper. And in that network everyone eventually can decide either the network is valid or not.  If any transaction is made then no worries that transaction would highly recorded in 1000’s of computers.

Another important thing that we would mention hacking a Block chain is not even an easy task because to do this hackers need to hack 1000’s of computer at a time which is highly equal to impossible so it is a safe technology.

Block chain is first used in 2008 when digital coin bitcoin is invented. Bitcoin is a decentralized cryptocurrency which is not under any bank or any country as mentioned above. The use of Block chain has been started through cryptocurrency but its use slowly been trying by government and public sector. E.g. Government or legal paper which has been used through a public register is a proof that for this property an owner is hereto. But now there is a vast scope of placing Block chain instead of public register in future because document registered in Block chain is as much as valuable in Public register.

Block chain if becomes becomes Public Register no chances of fraud to occur, Block chain is safe technology where even the stored data could not be erased, e.g., if incase a computer RAM or Hardisk got damaged it may not work but in Block chain 1,00,000’s of computers are working under this 1,2 or 100’s of computers even if are damaged still transaction is continued. Today in Block chain cryptocurrencies has been used in coming days banking sector would work on this because it is easy and safe. In Block chain every computer system history is recorded and been stored and the data is totally private where to enter a new partner need an approval of particular network partners. For any digital information makes safe and secure Block chain has been used each and every department would adopt Block chain technology either it may be university or passport services if it would be recorded on Block chain then Zero chances to hack by hackers.

As Per Government Schemes Poor people need help or students scholarship or any natural calamity victim then through Block chain technology amount will directly reach to people through phones. Through this corruption chances due to Third Party may not occur at all and the victim or person would would receive total amount.

Working of Block Chain Technology:

Let me explain through some Illustration:

Illustration 1: Assume Girl 1 who is innocent enjoyed her Trip in London with great experience and a huge shopping like jewels and dresses,etc. and returned India and shared her experiences with Girl 2 all about her shopping in London. This Girl 2 is cunning and clever she conveyed the same content with bit changes to Girl 3 that Girl 1 went to Kolkata and had a great experience and shoppings too. Now Girl 3 is little more clever then Girl 2 she coveyed the same content with bit more change that Girl 1 went went to local shop and bought all those in cheaper malls. Now what was the Actual content that Girl 1 went to London and had a great experience and shopping but what content coveyed to last Girl 4 that she went to some local shops and bought all those in cheaper malls. Here what we can see is content started something but till it reaches to last person content has totally been changed. The information how its been originated should reach in the same prospect to last person.

Let’s come to objective

So Replacing information let us use Bitcoins as Per Block chain.

Girl 1 Transaction à                       Girl 2 Transaction à             Girl 3 Transaction  

This should be the original transaction where girl 1 paid 10 Bitcoins and so as Girl 2 pay 10 bitcoins to Girl 3, but if incase Girl 1 pay 10 bitcoins to Girl 2 and as Girl 2   is clever and only pay 5 bitcoins to Girl 3 then the transaction becomes invalid become the propect is show clear that errors could be clearly visible.

This concept actually originated in 1991 but started using in 2008, now its been a famous when Bitcoin became popular. Now how Bitcoin works.

Transaction 1 à                            Transaction 2 à                  Transaction 3

Note: Hash means any transaction finger print or you can say a digital signature or a thumbprint.  Previous hash means in earlier if me make a transaction then it stores

If Instead of 10 Bitcoins I change 5 Bitcoins the Fingerprint changes. If any small thing I try to change then automatically finger print changes. It means for a particular transaction only this is the unique finger print.

Previous Hash will be hash of transaction 1 now e.g., if transaction we change B paid C as 5 Bitcoins then what happens the hash in transaction 1 changes as ACHKL021 which completely mismatches. It indicates that the Block chain is tampered/hacked/fraud so is not valid. Coming to 3^rd transaction the previous hash would be the hash of 2^nd transaction (so as applicable in transaction 1&2).

Through this table what we can completely understand is how the data originated will reach to the last person in same sense.

Now coming to hack this data let us hack then let me change the Bitcoin and also the hash transaction 1, also let us change hash and Previous hash in same as Transaction 2 and 3 also.

Note:

Proofs of Block chain Concept :

 1. It takes approximately 10minutes to generate one hash valueàIt keeps on getting tougher and tougher.

 2. Multiple copies of chain are maintained

1. It takes approximately 10minutes to generate one hash valueàIt keeps on getting tougher and tougher.

If I would generate a finger print either in A to B transaction or hash value then I would mention that it takes 10 minutes to generate a finger print. Now how big the chain is, it takes such time either it may be 10minutes/15 minutes/20 minutes, now such transaction takes place in crores. To change only a hash value it takes 10minutes now think that to change values/transaction/fingerprint.. how much time will it take 10minutes * 1 change = 1crore minutes nearly it takes 2years.

2. Multiple copies of chain are maintained.

Now we heard that Bitcoin is a distributive network not a central depository which is a main single ledger and keep going on. It is a Peer to peer network/distributed network whoever wants to generate crypto currency they must have copy of this ledger.

 Person 1:

Person 2:

Person 3:

 These are the multiple copies where every person in the network carries a copy of transaction, Now assume that the 2^nd person seems little clever and changed the hash as given below

Person 2:

Now comparing Person 2 copy with Person 1 & 3 Person 2 transaction appears little different, it means fraud has been happened in this case. So Bitcoin Block chain eliminates 2^nd transaction as it is an invalid transaction and copy the correct transaction and enter such transaction in Person 2 database. This is how Block chain works. To develop our country a proper technology should be adopted.