- Blockchain is a transparent, immutable, copied digital ledger for transactions.
- Bitcoin is one of the many cryptocurrencies out there.
- Together, they can create a digital era with incredible potential.
Any reader who has scrolled along the websites and finally stopped by this article must be aware of these two terms, Blockchain and Bitcoin, which have given rise to billion-dollar industries.Many naives use these two words reciprocally, and they are not to be said to be at fault because these are always found together. There will hardly be an article on the internet or a speech by a blockchain expert who does not use Bitcoin or vice-versa.
Let’s understand their meanings in a simplified way once again, and then discover the potential they carry when in tandem.
Blockchain
It’s a decentralized network of many nodes (individual computers) used as a ledger (record keeping) of digital transactions and tracking assets. This data, copied and distributed across many nodes, is stored on blocks, which keep on adding to the existing chain of blocks.
It is a transparent and secure way of storing immutable data, i.e., data, once recorded, can’t be deleted and accessible to all.The data stored on these blocks is encrypted with cryptography, and two keys are needed to access these data. Public Key, which is the address of the block in the database, and private key, which allows only you, the rightful owner of the data, to see it, making it highly secure.
Anything around you, which has value, can be put on a blockchain network for trading, like houses, cars, patents, and art paintings, you get the idea.
Another striking feature is the blockchain being a trustless network. This doesn’t mean that the network lacks trust, but the opposite is that there is no need to rely on trust, a moral factor, on blockchains. There are in-built algorithms like Proof of Work, Proof of Stake, and consensus mechanism, making this trust factor a mathematical problem to solve.
Blockchains can be used to maintain records in the medical and healthcare industry, track the products in a supply chain, maintain land records, and build a digital commerce network.
The terms to remember while mentioning blockchain are: Decentralised, Immutable, Transparent, and Trustless.
Having learned of Blockchain, let’s look at an example of where this technology is best exploited.
Bitcoin
Exploiting blockchain technologies, crypto currencies were built atop them. It is made from two words Crypto-cryptography and currency.
Bitcoin is the most popular cryptocurrency presently, in terms of Google trends ranking or market cap (around $524.84 Billion, literally more than the GDP of nearly 96 countries).Technically speaking, it’s a digital currency, which is decentralized i.e. not rests in the hands of a few people, company, or government, the system we presently know and exists. People known as miners/validators participate in validating a transaction by solving complex math problems, relying on heavy computational power and hardware, and after success, they are incentivized with Bitcoin tokens.
Like any other currency, Bitcoins are not unlimited but limited to a fixed number of 21 Million, which gives value to this currency. Cryptocurrencies are a fast and secure way of transferring money and participating in cross-border transactions, compared to traditional financial systems of SWIFT. Next time someone asks you what a Bitcoin is, just say crypto-currency, fast, secure, Proof of Work, 21 million, and he may set out to google Bitcoin.
BiBlo, the Bible for Digital Era:
Bitcoin and Blockchain are called the Duo, which will mold the digital era, we know now.Let’s look at some industries which are sure to feel their shocks
The Finance Sector
Presently, we are surrounded by a financial system that is centralized or, in simple words, controlled by a few people, companies, and lastly by the government. They hold the right to freeze/ban our accounts, charge high fees for transactions without transparency, and process slowly.The digital commerce which will rise because of Bitcoin will be something we haven’t yet imagined, as we didn’t in the success of UPI payment in India. You will be having a digital wallet with tokens, which have value and power to buy and trade assets. All your dealings are perfectly recorded and can’t be erased from the ledger. There is no case of fraud or cheating and cross-border payments are just as easy as emails, texts, or video calls.
The users form the governance and decide which rules to be implemented through voting. This already is in practice with millions of users engaged in daily bitcoin mining, trading, investment or commerce, but to become it a mainstream and a go-to network, still needs time, awareness and technical updates.
The Medical Sector:
During the Covid, many cases were heard of producing duplicate vaccines and supplying them instead of the original, risking the health of several humans. The blockchain network is a powerful tool to monitor the supply chain network and prevent such happenings. A person’s medical record is highly personal, and no one wishes to see them display in public. Hospitals are vulnerable to hacks where this record is leaked. Thus, using blockchain to maintain records can make them secure.
Gaming and Metaverse:
The gaming industry was on a boom when the features of AI, AR, and VR were rolled out for the first time. Blockchain games like Axie Infinity, Sandbox, and Sorare are already in the market and becoming a source of income.
Metaverse (beyond the universe) is a highly anticipated 3D virtual world; people are imagining and implementing blockchain in it will give a user experience like never before.
