What is Blockchain Technology? – A Quick Guide
Blockchain isn't just about cryptocurrency - it's applications include a variety of industries including fintech, healthcare, tourism, agriculture, and education.
Let’s explore what is blockchain technology and how does it work.
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Most people recognize blockchain technology with bitcoin. Some even confuse both terms and use them interchangeably. In reality, bitcoin is one application of blockchain technology among many others. Its applications include a variety of industries including fintech, healthcare, tourism, agriculture, and education. Let’s explore what is blockchain technology and how does it work.
But an interesting story first. Do you know that the first blockchain implementation was carried out by Satoshi Nakamoto in the late 2000s? You might be wondering why is this an interesting fact. Satoshi Nakamoto is a pseudonymous character. He or she might be a single person or group of people. The identity of Satoshi Nakamoto is still controversial. Numerous journalists claimed to identify him, while some people came forward as Satoshi Nakamoto themselves. However, the identity of the founder of bitcoin and the first blockchain technology developer is still disputed. How awesome is that, right?
What is Blockchain?
Here is blockchain’s definition according to Wikipedia:
“A blockchain, originally block chain, is a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (generally represented as a Merkle tree).”
Highly complicated (read technical) definition right? In simple words, blockchain technology is a secure and robust database system. How is it secure and robust? It is usually an immutable and decentralized ledger system that records data and transactions affiliated to assets in a business network. Blockchain has the following key features:
- Blockchain is a trust-based database system.
- In a blockchain, the data is connected or chained together in chronological order.
- There are different types of blockchain, such as private, decentralized, and hybrid. A detailed overview of the types is given here.
What’s decentralized blockchain technology? It’s a distributed ledger system! It allows peer-to-peer transactions transparently without the need for an intermediary, cutting costs and speeding up processes with high trust.
Want to read more about blockchain technology? Here is an interesting blockchain tutorial by IBM: Blockchain for Dummies.
Blockchain Technology Beyond Bitcoin
As discussed earlier, because the first (and undisputedly most popular) application of blockchain was a bitcoin, therefore many people believe that blockchain is all about crypto-currency. Now let’s see how blockchain development companies are implementing it in industries other than fintech and crypto-currencies. You can learn more about what is blockchain technology’s role in banking here.
Blockchain Technology in Healthcare
Blockchain has many applications from securely record patient’s data to manage the outbreak of coronavirus pandemic. For example, one of its major applications is EHR software. EHR software is short for electronic health records. EHR software collects and maintains patient data including the patient’s PII, medication, doctor’s recommendations, and the procedures that they have undergone in the past, and financial modules for invoicing and payments. Hence, blockchain technology is an ideal platform for EHR software.
Blockchain Technology in Agriculture
One interesting use case of blockchain in the agriculture industry is agriculture insurance. Agricultural insurance schemes manage unforeseen weather-related risks. Blockchain technology provides a secure and robust ledger system to record insurance premiums paid by farmers. Therefore, in case of a natural disaster, the insurer aid farmers through insurance money.
Education Sector and Blockchain
There are many use cases of blockchain in education. For example, students’ grades, degrees, diplomas, and credentials can be managed on a blockchain. MIT implemented this idea in 2017! This practice also handles the issue of fake degrees.
What is Blockchain Technology’s Role in Travel & Tourism?
The travel and tourism industry thrives upon communication. The business owners and customers share sensitive (personal and financial) information with each other. Blockchain manages, records, and store critical information with high reliability and security due to its decentralized ledger system.
So what’s blockchain technology all about? It is about trust, freedom, and robustness:
“Blockchain shifts trust in people and institutions to trust in technology” -Bruce Schneier
Do you have an idea for the next groundbreaking blockchain application? Or do you want to learn more about it? Feel free to contact our experts.