As the role of technology in our lives rapidly increases, so does the need for data and information security. This need is particularly acute in fields such as finance, where personal data is involved and many transactions are carried out simultaneously. That’s where blockchain technology comes in, aiming to provide data security and transparency. But what is blockchain? What is blockchain technology? Let’s explore the answers to these questions and more together.
What Is Blockchain?
Blockchain, or Block Chain, defines the chain structure made up of blocks. Blockchain acts as a database system in a distributed structure to track encrypted transactions. Blockchain facilitates processes such as recording transactions in a business network and tracking assets. It can also be thought of as a ledger that is shared and cannot be changed.
Why is Blockchain Technology Important?
In order for business processes to operate safely and efficiently, knowledge must be transferred as quickly and accurately as possible. The most basic benefit of blockchain in this regard is that it is a ledger that can only be accessed by network members with permission. Moreover, members who can access the system cannot make any changes to the data. Another feature that makes blockchain ideal is that it is a structure that provides shared and transparent information. This is a reassuring element for the user.
How does blockchain work?
Blockchain does not have a central system. All computers can access data on the block chain. In addition to accessing data, it is also possible to transparently access information such as who owns the transactions made here and when they were made.
Since the operations made in this technology cannot be changed, a new record is added to the system when it is desired to make a correction. In this way, all details are kept and all correct and incorrect operations can be observed. In blockchain technology, identity is created in the form of a user identification number that all networks know. Therefore, instead of using personal information such as name and surname, all transactions are made with this identification number. The transactions made here are recorded on the chain by the mathematical calculations of the user, that is, the hash functions.
Hash functions create character strings consisting of letters and numbers. A different string is generated in case of the slightest change.
All operations are verified by the user and records become permanent. This shows that this technology is not centrally located. In short, the important elements of blockchain technology; the fact that it is anonymous, that it is not a central system and that it cannot be corrupted or hacked.
What is the use of Blockchain technology?
Blockchain technology securely stores data with its data privacy feature. To change the data here, you need approval from other blocks. This puts the approval mechanism in place as many times as there are blocks. In this way, the system prevents data from being compromised by any malicious action from outside.
What Are the Uses of Blockchain?
The blockchain technology has a structure and function that can be used in many different sectors. Here are the main sectors where the technology is widely used:
- Public sector
- Financial sector
- Energy sector
- Health sector
- Supply chain