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What is the principle of blockchain, many novices are not very clear about this, in order to help you solve this problem, the following small series will explain in detail for everyone, people who have this need can learn, I hope you can gain something.

I. Foreword

To understand blockchain, one must first understand the history of cryptocurrencies and how they have changed the economy as we know it.

For decades, people have tried to diversify money and make the economic system more volatile. The first known attempt to combine cryptography with electronic money, these currencies used cryptography to anonymously conduct monetary transactions; however, its issuance and clearing remained centralized. These first attempts are credited to computer scientist David.

As a result of this, the concept of cryptocurrency was born, coined by Wei Dai in 1998, during which year it was formally proposed to create a new type of decentralized money, using cryptography as a means of control.

However, it wasn't until 2009 that the first known and used cryptocurrency was created in the technical realm: Bitcoin. The first cryptocurrencies were created by pseudonyms of developers or developer organizations.

Subsequently, other cryptocurrencies appeared, however, Bitcoin cryptocurrency became increasingly popular over the years due to the dizzying growth in April 2013.

A lot of people new to blockchain ask,"What is blockchain? "I would suggest ta read this" blockchain "article. What is it and why is it so popular? Can anyone say it simply? Three sentences to describe it, and then I answered ta with one sentence: distributed ledger, which records your network activity in a bookkeeping way and distributes it across the network.

II. How blockchain works

1. a decentralized

Decentralization, as its name implies, is to remove these central credit carriers, remove middlemen to earn spreads, and realize people-to-person (peer-to-peer) trading. Of course, this is only the centralization of financial payments, applied to other nodes we collectively refer to (the above merchants and consumers can be understood as a node), in a distributed system with many nodes, each node has a high degree of autonomy. Nodes can be freely connected to each other to form new connection units. Any node may become the center of the stage, but it does not have the mandatory central control function. The influence between nodes will form nonlinear causality through the network. This open, flat, egalitarian system phenomenon or structure is called decentralization.

2. Distributed ledger

It is a database that is shared, replicated, and synchronized among network members. Distributed ledgers record transactions between network participants, such as the exchange of assets or data. This shared ledger reduces the time and expense of reconciling different ledgers. Essentially an asset database that can be shared across multiple sites, geographies, or networks of organizations. Participants in a network can obtain a copy of a unique, authentic ledger. Any changes to the ledger will be reflected in all copies, and the reaction time will be within minutes or even seconds. The assets stored in this ledger can be financial, legally defined, physical or electronic.

3. Bitcoin

Bitcoin is a virtual cryptocurrency in the form of P2P. Point-to-point transmission implies a decentralized payment system. Unlike all currencies, Bitcoin does not rely on a specific currency institution to issue, it is generated by a large number of calculations according to a specific algorithm. Bitcoin economy uses a distributed database composed of many nodes in the entire Forex broker dynamic http://www.kaifx.cn/lists/news/to confirm and record all transactions, and uses cryptographic design to ensure the security of all aspects of currency circulation. The biggest difference between Bitcoin and other virtual currencies is that its total number is very limited and it has a strong scarcity.

III. Application of blockchain technology

Immutable technology for data storage and transmission, insurance and medical systems for data storage and transmission generally prioritize their immutable performance. These industries are actively exploring the potential of blockchain technology and believe that the technology has unparalleled potential in terms of immutability.

Like many blockchain startups, they have been looking for ways to use blockchain technology for data storage and transmission. Decentralized distributed ledger technology to enable secure management of asset ownership, revolutionizing the asset management industry. It effectively eliminates the risk of single points of failure, the risk of relying on third-party escrow agents, and most of the friction found in traditional systems.

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