6 Major Features Of Blockchain | Why Blockchain is Popular?

Blockchain is one the most popular and exciting technologies right now. Even though most people are familiar with the term they don’t completely understand the technology. It is the underlying concept that cryptocurrencies work upon but it is also so much more. In this article, we will learn about blockchain and its features. Let’s start!!1

Introduction to blockchain

Blockchain is a list of records called blocks that store data publicly and in chronological order. The information is encrypted using cryptography to ensure that the privacy of the user is not compromised and data cannot be altered. The information is stored and managed in a decentralised manner hence no central authority is the sole decision maker. Instead, most decisions are based on a consensus of all the participating nodes of the network spread all over the world.

Features of Blockchain

Now that we have some basic understanding of blockchain technology let us review its primary features.

1. Increased Capacity

This is the first and an important feature of Blockchain. The most remarkable thing about this Blockchain technology is that it increases the capacity of the whole network. Because of the reason that there are a lot of computers working together which in total offers a great power then few of the devices where the things are centralised.

A perfect example of this increased capacity is a project started by Stanford University which created a supercomputer that simulates protein folding for medical research.

2. Better Security

Blockchain technology is considered more secure than its contemporaries because of lack of a single point of failure. Blockchain operates on a well-distributed network of nodes, hence data at all times is circulated through not one but multiple nodes, which makes sure that even if one node is hacked or faulty in any way the integrity of the original data will not be compromised.

3. Immutability

Creating immutable ledgers is one of the main values of Blockchain. Any database that is centralised is destined for hacks and frauds since it requires trust in some third party intermediary to keep the database secure.

Blockchain like Bitcoin keeps its ledgers in a never-ending state of forwarding momentum. Every node on the system has a copy of the digital ledger. To add a transaction every node needs to check its validity. If the majority thinks it’s valid, then it’s added to the ledger. This promotes transparency and makes it corruption-proof.

Another fact is that, once the transaction blocks get added on the ledger, no one can just go back and change it. Thus, any user on the network won’t be able to edit, delete or update it.

How does it fight corruption?

Almost all cybersecurity hacks and leaks have had an internal link who knows about all the security measures, so in the end, mutual trust becomes detrimental for security. In today’s era even banks aren’t that reliable and the global economy demands a trustless environment to fully overcome this issue.

So, when it comes to a corruption-free environment, you can easily assume that blockchain can definitely change a lot of these scenarios. Hence, when businesses start to integrate blockchain to maintain their internal networking system, no one would be able to hack into it or alter or even steal information.

Public Blockchains are a perfect example of this. Everyone in the public blockchain can see the transactions, so it is super transparent. On the other hand, private blockchains could be a good option for enterprises that want to remain transparent among staff and protect their sensitive information along the way from public view.

4. Faster Settlement

Traditional banking systems are unbelievably slow, probably because they require a lot of settlement time and usually take days to proceed. This is one of the main reasons why these banking institutes need to upgrade their banking systems. We can solve this problem by the means of Blockchain as it can settle money transfer at really fast speeds. This ultimately saves a lot of time and money from these institutions and provides convenience to the consumer also.

5. Decentralised System

Decentralised technology gives you the power to store your assets in a network without the oversight and control of a single person organisation or entity. Through this owner has direct control over their account by the means of a key that is linked to the account which gives the owner a power to transfer his assets to anyone they want. Blockchain technology proves to be a really effective tool for decentralising the web which could be nothing short of revolution in the world of internet.

Uses of decentralization

a. Less Failure: Since a lot of actions on a blockchain are automated and do not involve much human oversight there is less probability of failures or errors.

b. User Control: With decentralisation, users now have control over their properties. They don’t have to rely on any third party to maintain their assets. All of them can do it simultaneously by themselves.

c. No single point of failure: The decentralised system makes it such that every database is stored in a large number of nodes spread all across the globe there is no single point of failure, hence even if one computer is compromised the blockchain will be safe.

d. No intermediaries: Decentralised nature of the technology makes it a system that doesn’t rely on third-party companies which further reduces additional costs and risks.

e. Zero Scams: As the system runs on algorithms, there is no chance for people to scam you out of anything. No one can utilise blockchain for their personal gains.

f. Transparency: The decentralised nature of technology allows a transparent profile of every participant. Every change on the blockchain is visible and makes it more reliable.

g. Authentic: TThe system can be designed in a way that is unique for every kind of person. And hackers will have a hard time cracking it.

6. Consensus

The consensus algorithm is what makes blockchain technologies highly effective. It is an integral feature of every blockchain and indeed is a defining characteristic. To put it simply, consensus is a decision-making process for the group of nodes active on the network. Here, the nodes can come to an agreement quickly and relatively faster.

When millions of nodes are validating a transaction, a consensus is absolutely necessary for a system to run smoothly. You could think of it as kind of a voting system, where the majority wins, and the minority has to support it. Truth be told, consensus is what makes the system trustless. The nodes might not trust each other, but they can trust the algorithms that run at the core of it. That’s why every decision on the network is a winning scenario for the blockchain.

Irreversibility of Hashing

Hashing is a complex mechanism, and it’s impossible to alter or reverse. Which means that no one can use the public key to reverse-engineer the private key. Also, a single change in the input could lead to a completely different key output, so minute changes will also be detected.

In order to corrupt the network the hacker would have to alter at least 51% of the databases present on the nodes in the network. There could be millions and millions of people, where everyone has the same copy of the ledger. Accessing and hacking millions of computers is next to impossible and costly.

That’s why it’s one of the best blockchain features. As it’s too hard to bypass, you won’t have to worry about hackers taking all your digital assets from you.

7. Distributed Ledger

Public ledgers provide information about transactions and include participants to the public. There is lack of security or authority in such ledgers which is not the case for private or federated ledgers that can also be integrated into a blockchain system. That’s because the ledger on the network is maintained by all other users on the system. This distributed computational power across the computers to ensure a better outcome.

The distributed ledger allows anyone with the required access to view the ledger and makes the process transparent and reliable.

Importance of DLTs :

a. Tamper-Resistant : Distributed ledgers are designed such that no one can change the ledger and all updates take place almost simultaneously.

b. Ownership of Verification: Nodes of the network act as verifiers of the ledger. If a user wants to add a new block others would have to verify the transaction and then give the green signal.

c. No bias: No one on the network can get any special favours or experience bias of any kind from the network nodes. Everyone has to go through the same procedure to add blocks.

d. Managership: To make the blockchain features work, every active node has to maintain the ledger and participate for validation.

e. Quick Response: The lack of intermediates hastens the system response. Any change in the ledger is updated in minutes or even seconds!

8.Cannot be corrupted

Every node on the network has a copy of the digital ledger. To add a transaction every roce needs to check its validity. If the majority thinks it’s valid, then it’s added to the ledger. This promotes transparency and makes it corruption-proof.

9. Minting

Basically, there are a lot of ways of minting a problem of manipulation that we can solve by Blockchain. In the west people and corporations do show a sense of mutual trust, banks and multinational tech giants like Google and Meta assure a sense of reliability and responsibility.

Now, opportunities for blockchain are higher in those countries which don’t reach a level yet but mining is the most frequent method. But in recent time’s many new methods have also been introduced as proof of work is one approach by which an individual can prove that he is engaged in a significant amount of computation work.

Conclusion

In this article, we focussed on learning the main features of a blockchain. We began by gaining a brief description of what a blockchain is and then proceeded to understand some of its core features, the reasons for their existence, and their benefits.