Although blockchain is a relatively a new concept but in reality, it is amalgamation of three old technologies, which have been used by us since long. In a blockchain, techniques from Ledger, Cryptography and Networking are combined to drive desired solutions. Let’s look briefly what these technologies do and how these are integrated to build a blockchain solution.
LEDGERS
Human beings have been using ledgers since ages. Ledgers are used to maintain record of transactions. Each transaction is recorded in a specific way on ledgers. At its core blockchain is also a record keeping device, which tells a story about ownership of an asset.
However, traditional ledgers are maintained centrally with in an organization, while, in blockchain a copy of ledger is maintained by every single node (connected computer) on a blockchain network. This is why blockchain technology is also called Distributed Ledger Technology (DTL).
CRYPTOGRAPHY
We human beings have been coding and decoding our message since very long. Messages have been decoded and encrypted in order to protect them to be reached in unwanted hands. Similarly, content of all preceding blocks is encrypted into the next block header using the hashing or cryptography.
This act of cryptography serves in many ways. First of all, it provides a linkage to all previous blocks (the reason why it’s called blockchain as each block is connected to the preceding block through a hashtag).
Secondly, it also provides the immunity to blockchain as if someone wants to change the content/ records of previous/ older blocks, (s) he has to change the code in all the following blocks on all the copies of ledgers held on a blockchain network. Making such bad attempts to alter the coding and content of a blockchain is nearly impossible as the speed and computing power required to complete this task consume a considerable amount of energy.
NETWORKING
The third technology used to build a blockchain solution is, existence of a peer-to-peer network of computing machines. Participants who keep records of ledger and validate each-other’s blocks are connected through a computer network. Besides, providing infrastructure for connecting devices, a network also provides some other unique functionalities for blockchain based applications.
Each connected node/ computer work as storage for information on blockchain. However, unlike a traditional database, data in not stored centrally on a server, instead all connected devices maintain individual copy of ledger. This information is consciously validated within a network through group consciousness, thus the record held by a simple majority will be retained on each device, whereas all other versions will be discarded. This means that there won’t be any need to trust someone as long as every participant trust the integrity of this system.
Further, any device in the network may go offline and become online as required. Upon coming online, the device automatically synchronise itself with all network, means network does not need any single point for dependency, which must be entrusted. Resultantly, blockchain network are also ideal where uptime or network connectivity is not guaranteed.
The above explained technologies when amalgamated, provide fundamental and most basic functionalities of a blockchain network. However, depending upon the nature of solution required, other techniques are being added and new possibilities are being explored by researchers.
