What is Blockchain Technology? Understand How it Works
In this Article you can easily understand Blockchain Technology, its works and purposes, how crypto is related to blockchain with simple words and examples.
Blockchain
Blockchain Technology is a digital ledger that records the transaction details of cryptocurrency senders and receivers, ensuring secure and transparent transactions.
Each cryptocurrency operates on its blockchain, which underpins the safety and security of these transactions.
Numerous cryptocurrencies exist worldwide, including Bitcoin, Ethereum, Ripple, and Parkcoin. Individuals can purchase cryptocurrencies on Global cryptocurrency exchange platforms such as Binance, Koinpark, and Gate IO.
Main Purpose of Blockchain Technology
Maintaining the crores of transaction details accurately in a ledger without a single mistake.
Everyone can see every transaction that occurs globally because it is transparent to everyone.
Being transparent to everyone, blockchain assures that it is very safe and secure to make transactions. No one can change a record while it's globally watched by everyone.
How Blockchain Works?
From Digital Wallet:
Users can store their cryptocurrency in their digital wallet. This Digital wallet is the Interface of Blockchain.
Here we go with a simple example: User A sends 2 Parkcoin (KPK) from his wallet to User B. Now the wallet creates a text file about Transactions between A and B.
Transaction Verification:
Now a transaction text file is created by the wallet and sends that text file to all computers in the blockchain network.
Those computers verify how much user A holds cryptocurrency in his wallet, and verify if user A can send 2 parkcoins, how much balance he holds in his wallet, those verifications are confirmed by the computers in the blockchain network.
(computers verify in the blockchain network means the persons involved check the transactions and they approve once it is done verification)
Finally, Block creates:
Once all verification is done and approved by computers finally these transaction details are entered into the block.
Each Block contains previous, present, and upcoming transaction details. So everyone has a chance to see and have all transaction records in the blockchain.
Each Block contains multiple transaction details and there is a limit for each block. If one block has reached its limits then the next block is created.
So Previous block is linked to the present block and the present block will be linked to upcoming blocks. In this way, blocks are linked together like a chain so it is called Blockchain (Block is nothing it is a ledger, bill records)
There is no chance to hack and change the records. Because if a hacker tries to change the records he needs to change everyone's records in the blockchain, So it is impossible to change and steal records. Absolutely safe and secure for transactions
Let's see how cryptocurrency works on blockchain.
Each cryptocurrency has its own blockchain or some crypto works on the Ethereum blockchain.
If user A bought 50 Ripple (XRP) from the Koinpark exchange, the transaction is recorded on Ripple's blockchain, called the XRP Ledger. This means the history of user A buying 50 XRP is safely and securely saved on the XRP Ledger.
Every cryptocurrency transaction is recorded on its own blockchain, ensuring that no third party can hack, steal, or change the data.
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