What Can a Blockchain Do?

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Internet commerce is becoming more popular every year, but it is hindered by the threat of hacker attacks and distrust of partners by competing with traditional business. This problem is solved by the new database technology - Blockchain. These databases do not have a single control center, operations are confirmed by other network members, so they are immune to hacker attacks and allow verifying the truth of information about a partner - this is the future of Internet commerce.

Blockchain - a new kind of databases without a single center

Blockchain is a database, that is, an electronic information store, similar to an entry in an Excel file. For example, in bank bases it is written how much money lays on accounts, and in a database of police - who and when broke rules. A similar principle here, unlike traditional databases, in Blockchain the information is not in a single store, but is written to each participating computer on the network. Blockchain technology registers transactions in such a way that they can not be deleted or rewritten afterwards, the information is only consistently updated. Therefore, the data is written in the form of a chain of updates, not a table. You put 100 dollars on the account, and a database with this information appeared in the database. Then you sent someone $ 50 and put another 100. But in the first block information about the amount of money will not change by 150 - two new blocks with updates will be added. Each of them has its own code, indicating a link to the previous and next blocks.

Collect and update this information so-called miners - active users, who for their work receive cyber-currency fees Bitcoin.

Blockchain data can not be faked

Every day there are news that some hacker has stolen money from bank accounts or cracked a celebrity email. This is because information is easy to access. And Blockchain makes the theft of information impossible. If the hacker inserts a fake between existing blocks, the system will notice the substitution - the code for the new block will be different from the sequence of the others. Changes in the blocks themselves also affect the code, and thus any changes are immediately noticed by the miners. Overwrite the entire chain will not work, because Blockchain is a distributed database, and information is stored simultaneously on thousands of computers. Even if information changes on one, other users will notice a substitution - they have some original data stored.

The protection of information is especially important for banks: in the format of figures in the cells of databases they store money. If an attacker changes this information, he can steal money from accounts or disrupt the bank's work.

New technology will allow you to transfer money without intermediaries

When the seller and the buyer plan to make a deal, they are looking for an intermediary who follows the integrity of the agreement. In financial transactions, the intermediary is the bank: it guarantees that the money will not go anywhere and will reach from the payer to the recipient. Also, the bank issues a confirmation of payment - it does not matter whether it is about paying a gas bill or buying a factory. For this, financial institutions record transaction information in their databases. We use their services, because this is the most reliable variant of mediation.

But the technology of data storage Blockchain allows you to do without intermediaries. Imagine, you want to pay for the goods from the online store and make a transfer through Blockchain. In your data chain there will be an entry that the money is listed to the store - then you have confirmation. Money transfer is "seen" by all network members, and it will be reflected in the update of your data. In the process of transfer it is impossible to steal money or erase a record, because the system is immune to hacking. The store also knows that the translation is real, because if you had forged a data block, the system would have noticed it and deleted the fictitious entry. Everything is the same as in the bank, but you do not need to pay an intermediary for services. With this approach, banks are not needed, and given the increasing popularity of Internet commerce, Blockchain is able to compete with traditional payment systems.

Blockchain will allow you to check the trading partners and register your personal data

In March 2014, a new version of Blockchain, which allows you to not only record payments, but also record information. It can be used to compile open databases - for example, land cadastres, or register contracts online, because an open database allows you to check information about a partner.

Also in Blockchain you can register goods and other valuables. For example, a car buyer will receive from the seller a chain of data about the car to make sure that the car is bought legally, and not stolen, is not secured, and so on. In these cases, Blockchain will replace the business of intermediaries, notaries and even government agencies. But to make the replacement equal, users should be sure that there is all possible information in the database.