Blockchain, a ZDNet definition

Blockchain, or “chain of blocks”, relies on a distributed ledger system to store, transmit and update data over a private or public network. Bitcoin is the best known public blockchain.

In the world of finance, Bitcoin has undoubtedly popularized the concept of blockchain (it is also for Bitcoin that the technology was created) and cryptocurrency in France and around the world. The Bitcoin network is defined, according to its creator Satoshi Nakamoto, as a “peer-to-peer liquidity exchange system, which would allow online payments between two parties, without going through a financial institution”.

The principle of the blockchain is decentralization. It allows you to carry out operations, such as a transaction, or the recording of data, without the need for a central entity. The goal is to dissociate from any bank or currency to have a universal system connected to the Internet. However, blockchain technology doesn’t just aim to upset banking operators.

Allowed blockchain and public or open blockchain

Its uses are more extensive and today affect many sectors, such as logistics, insurance, energy, food and pharmacology. The blockchain, which can be compared to a digital database, allows information to be stored, transferred and updated, all in the same place and in complete safety.

And this knowledge is shared among the different members of the blockchain network, or even with all users, in the case of a public blockchain. In fact, there are two main categories of blockchains: private (allowed and centralized) and public.

In both cases, the blockchain is based on a ledger in which the recorded data and information are kept. The main difference is in the access to the data. The private blockchain restricts access to only authorized members, such as participants in a blockchain consortium.

The public blockchain, on the other hand, such as Bitcoin, Ethereum and the various cryptocurrencies, makes the data available to everyone. And it operates in a truly decentralized way.

Therefore, the validation of operations and the recording of data on the blockchain require the approval of a block by several actors. The blockchain is named after this block system. The management of these blocks and their information by multiple users, or nodes, is therefore transparent and secure.

The definition of blockchain as explained by the mathematician and computer scientist Jean-Paul Delahaye (author of numerous articles on bitcoin, Ethereum, cryptocurrencies and blockchain) is that it is a “very large notebook that everyone can read for free and freely, on which everyone knows to write, but which is impossible to erase and indestructible “.

Chronological, immutable, and tamper-proof data

A block represents the combination of several “transactions”. Block size varies based on blockchain technology. Bitcoin thus generates blocks that can weigh up to 1 MB every 10 minutes. Each block corresponds to a unique identifier, a “hash”.

Decentralization is not just based on the participation of multiple block validators. Each, which makes up a node, hosts a copy of the database. Consequently, to modify the data, the agreement of several nodes is required. Blockchain data is therefore said to be historical, immutable and tamper-proof.

The integrity of the data is thus guaranteed, in particular by their distribution among the various minors (other name of the users). Miners, stakers, or even bakers, depending on the type of blockchain and consensus, have the fundamental mission of validating the generated blocks before validating a transaction. The exchange processes, or transactions, are then carried out in complete security and confidentiality thanks to this multiple control of the system users.

The essence of the blockchain, its architecture and its multiple roles, is to help restore trust by breaking free from a centralizing intermediary. The blockchain therefore allows you to transfer assets between the parties, to track an asset, for example for food traceability, and to automatically execute transactions.

The blockchain can indeed mobilize another technology, smart contracts. These programmable contracts are executed automatically based on predefined conditions. Thus, for use, for example in the insurance sector, it will be possible to automatically compensate your customers for flight delays of more than two hours.

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