Blockchain Is: Technology, Definition, History, Principles, and How It Works

Blockchain can also be defined as a technology that focuses on the best use of computing technology with the aim of creating a collection of groups or, as the name suggests, blockchain, a series of blocks that are connected to each other.

From this it can be concluded that a group of interconnected blocks has a different record of a series of transactions and can be used to track the whereabouts of assets contained in the corporate network.

Blockchain itself is seen as transactions in digital form, which of course have arrangements and are based on the shape of the structure. With this clear structure, each individual record or named block is connected like a chain called a chain.

For a more detailed explanation, DailySocial.id describes it as follows!

Blockchain definition

Blockchain is a collection of various records that are processed or processed by a group of computers that do not contain an entity or a whole. Collections of blocks or data records are secured and linked using cryptographic principles.

The networks they contain have no centralized authorization or authority. Then why? This is because the blockchain contains various records formatted like a very large ledger. Accounts can be shared, but their contents don't change. In addition, all information in the ledger is visible and accessible to anyone who only looks at it.

Therefore, the three principles of blockchain technology include the principle of transparency, because blockchain is transparent. This property means that everything contained in the blockchain is visible to other people, who are collectively responsible for the operation of their every action.

In addition to all of the above, blockchain technology is free from transaction fees, including infrastructure fees. With these advantages, blockchain is said or considered as the simplest, smartest and most efficient way to transfer information from one person to another and so on in a safer and of course automatic way.

The various blocks listed in it have received verification status from different computers and of course the transmission process is directly assisted by online support.

Different blocks, successfully controlled by the computer, are then added to the chain and then divided in a special network. So, after that, a special record is automatically created that contains a unique history that was previously created as a result of this process.

An example can be described in a situation where you buy a train ticket through an application or a certain place to buy a train ticket. For payment transactions, you use the credit card payment method. That is, the credit card service provider then takes steps to reduce it so that the transaction process runs smoothly and successfully.

The use of blockchain can also cause a drawback, namely the operator of the train is not given access to save costs when processing or processing credit cards. All event tickets are fully transferred to the blockchain. In this process, the parties in the ticketing process are only prospective passengers from the train company that serves them

When you buy a train ticket, the ticket is valid as one block. The ticket or block then goes through further processing to be added to the ticket blockchain. This can be likened to the process of monetary transactions occurring on the blockchain, which are interpreted as unique, verifiable, and unverifiable records.

The blockchain contained in the ticket is a kind of public record of all transactions that occur for the purchase of a particular train ticket or perhaps for the entire rail network. The records contain various transaction histories for each ticket sold from all previously recorded travel records.

A Brief History of the Blockchain

Quoting from the book "Blockchain for Dummies" written by Manav Gupta, explaining that blockchain was originally founded and developed to meet the great need for a system that is more effective, cheaper, more secure and proven to be safer when carrying out the task of recording various future financial transactions .

The idea of ​​using blockchain itself was born in 1991. Then two people wrote and published Journal of Cryptography:
How to Time Stamp a Digital Document are two people namely Stuart Haber and W. Scott Stornetta.

The blockchain was originally designed for use in Bitcoin and was developed around 2009. The development of the Blockchain was done by Satoshi Nakamoto of Japan.

Unlike the money generated by central banks which is still traditional money, the existence of Bitcoin is somewhat different because Bitcoin has no central power or authority and there is no task force to control it.

Rather than relying entirely on a central authority for control, accepting verification and approval of transaction requests, and processing cash receipts, Bitcoin prefers to be activated through a network of relationships. peer-to-peer.

How the Blockchain Works

The main function of the formation of the blockchain is to function as a form that gives permission for digital information to be recorded and distributed or disseminated without having access so that it can be changed, destroyed, destroyed, and deleted.

This has earned blockchain the nickname Distributed Ledger Technology (DLT). The working system of the blockchain is to use bitcoin purchases. In the following, we will present the working system of the blockchain.

• The way blockchain works starts with someone buying a number of bitcoins.
• After that there will be a transaction process, the transaction process will be transferred through a computer network that is installed using the peer to peer method which of course is spread throughout the world.
• After that, the computer network then completes an equation that serves to confirm the validity of the transaction.
• After the transaction is confirmed to be a valid transaction, the next process is that the transaction will be grouped together as a block.
• This collection of blocks will then be combined into one and will be recapitulated to become a record that contains a long history of these transactions that are permanent and cannot be changed.
• After that, the transaction is complete.

Because the blockchain makes transactions more secure, decentralized, safe, and durable or permanent which can attract interest from many industries in the world.

Advantages of Blockchain

Guaranteed Data Security Quality

The database in the blockchain is append only, which can only be added and cannot or does not provide access to repair the data. thus it will make it difficult for hackers who want to hack the data in the blockchain.

Using More Transparent Systems

As previously explained, this blockchain technology offers advantages in terms of efficiency in recording transactions and tracking data. It also shows the safety and transparency of the data stored.

This is evidenced by the fact that during the transaction process, all parties can see public access without having to go through the login process first.

Unlike bank-owned systems, blockchain-owned systems are different in that they use all the technologies that have been successfully implemented in the blockchain, all data, information, and even funds that users provide do not fall into the hands of other people without the user's knowledge.

Much Better Audit Quality

Blockchain has the advantage of giving users access to the history and traces of all audit funds belonging to that user. This is very useful for reducing the risk of misappropriation of funds that currently occurs in the business environment.

Can Prevent Possible Middleman Fees

Not only is the presence of the blockchain directly helping to eliminate middlemen in the blink of an eye. An agent or what is often referred to as an intermediary often adds a transaction fee as a form of remuneration for his services to replace the role.

So this is the advantage of the blockchain, where all activities resulting from historical records and traces become more organized, structured and controlled. It also becomes more durable and long lasting.