Why should you consider Blockchain?

Security is definitely a concern for everyone when it comes to transactions.. So where does blockchain stand when it comes to security?? Find out...

How secure is Blockchain?

To know how secure blockchain is, recall the process of money transfer via a bank. (To know more about blockchain read this blog)..

You go to a bank, tell them you want to make a money transfer, give them your account details and the receivers details, the bank saves all these details and makes the transfer. Sounds easy, right? But this process can tamper – can be altered and that too very easily.

Here’s where Blockchain comes into play. It’s decentralized, secure, and transparent (i.e., the data is available publicly) way of money transfer.

You might now be thinking that since the transaction data is available publicly it might have some safety issues. Like a hacker can hack this data and alter it. What will happen then?

Let’s try to visualize what will happen if someone attempts to alter the data in the blockchain.

Imagine a block is added in a blockchain, and as you know this block will contain its own hash and also the hash of the block before it.

Now, consider if someone alters the data in this block. What will happen? Its data will be altered, right? It’s not that simple. It would have been but thanks for “Hash codes”. One thing about these Hash codes is that they are created by a math function that converts digital information into a string of numbers and letters. If this information is edited/altered in any way, the hash code will change as well.

So now, back to our situation. The block is altered and now you know so well it's hash. But the next block still contains the old hash. Now this person will have to update the next block as well and since the same applies to the next one too, he will have to update the next and then the next and so on..

Each time he’s updating a block, he needs to update the next one as well and the process will go on like this, and each time he will have to recalculate all the upcoming hashes which would take an enormous and unpredictable amount of computing power.

In short, once a block is added to the blockchain, it’s extremely difficult to alter and not possible to delete it.

So, we can conclude that the aim of blockchain is to allow data to be recorded and distributed but not altered.

What are the advantages of Blockchain?

Here are some advantages of Blockchain:

Highly accurate

Since the transactions on the blockchain network are verified by a network of thousands of computers, this makes it highly accurate as there are no chances of errors.

Zero transaction cost

To add to its aforementioned advantage, Blockchain has 0 transaction charges. As you might be familiar with the fact that whenever you make a money transfer, the bank charges you with a specific amount for the transaction to take place. But that’s not the case with blockchain since it has 0 transaction charges.

Transaction Efficiency

Blockchain allows completing transactions within minutes.

More Secure Transactions

The authenticity of each transaction is verified by the blockchain network. This is done by a network of thousands of computers. It’s only after a computer validates a transaction it is added to the blockchain as a block. Each block has its own unique hash code as well which makes it difficult to alter the information in the block.

Transparency

Although it’s secure, the blockchain technology is open-source, but the personal information is kept confidential. Since its open-source, millions of computers are always tracking it, thus making it difficult to tamper.

Since blockchain is on its way to make business and government operations more accurate, secure and is increasing their efficiency, it’s usage has been on the rise and will tend to increase more with the coming years.