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Bitcoin:

Blockchain and Bitcoin Definitions and Comparison

What is Blockchain?

Digital currency technology has received a lot of attention in recent years, and if you are familiar with the digital currency market and cryptocurrencies such as Bitcoin, you have probably heard the name "Blockchain" many times. Since digital currencies are based on this technology, it is important to know what Blockchain is and how it works.

What is Blockchain technology? "It's a technology that eliminates banks and financial institutions".

Blockchain is a network that uses decentralized technologies and encryption to record the history of all transactions with digital assets such as bitcoin in a ledger that cannot be changed, and all information recorded in it is available to all users. The blockchain network has made it possible to eliminate banks and financial institutions from digital asset transactions and ensure the security of digital currencies.

Blockchain technology is a structure that stores transaction records "blocks" as a database called "Chain" in a network of "nodes" that are connected peer to peer. Let me explain more clearly.

Bitcoin Blockchain

Blockchain is a simple word: A network of immutable data

To put it simply, we have to think of blockchain as a long chain of data. Data includes transactions that take place on the network. Transaction records are stored in units called blocks. Each block is added to the end of the chain after the capacity is filled and the information is verified. This chain of blocks, called the chin block, is stored in network nodes. Nodes are computers that are responsible for storing all network data and in which a copy of all data is stored.

What is "Digital Ledger", And why is it safe?

Blockchain is a large digital ledger in which network transaction data is accurately stored. Any information that enters the network must be verified by a digital signature and verified by other members of the network. No one owns the Blockchain network and everyone can access all the data registered in the network, However, they can't change the data. Because all network data is stored in each node, to alter the data, all the nodes must be changed. Besides, the structure of the Blockchain is such that changing the data of any block will make it invalid.

Bitcoin Blockchain Process

What are Blockchain network nodes?

One of the most important qualities of a Blockchain network is that it is decentralized. No single computer, organization, or institution can be the entire network. Instead, the network is a distributed ledger that is protected by interconnected nodes in the network. A node is any type of electronic device that can store a copy of the entire Blockchain network and enable network operation.

Blockchain and its comparison with the banking system; Why is Blockchain better than the banking system?

There are several major problems with the banking system that you may encounter during your transactions. The banking system will deduct a significant amount of fee from your account when you transfer money to others. The system being centralized means that if the data in the bank is lost, all the data in the accounts will also be lost.

Blockchain has many advantages over the bank, such as:
  • Ability to complete transactions anonymously
  • Paying a small amount of fee
  • The distributed system is almost unhackable
  • transparency
  • No need for intermediaries
  • high security
  • unchangeable
  • Indestructible
  • No one is in control
  • Ability to transfer assets from anywhere
  • Fast and secure transactions

The difference between Blockchain and Bitcoin in simple language

Blockchain is a technology and cryptocurrencies like Bitcoin using Blockchain for protected and anonymous transactions. Blockchain is a transparent mechanism, whereas bitcoins operate on anonymity. Blockchain is much more widespread, while bitcoin is only assigned to exchange in digital currencies world.

A simple comparison between Blockchain and Bitcoin

Bitcoin:
  • Uses Blockchain for decentralization
  • Blockchain is just a part of Bitcoin
  • In the Blockchain, bitcoin transactions are registered
Blockchain:
  • Store distributed data
  • First used in Bitcoin
  • It can be applied in other fields as well

Closing remarks

Both bitcoin and Blockchain have a lot of strengths and room for improvement. Despite the millions of transactions that take place every day around the world, bitcoin and Blockchain have come to facilitate people's lives in the digital age.

Today, Bitcoin is amongst the many applications that work with Blockchain; But Blockchain has more uses. Significant developments have taken place in Blockchain technology over the past decade, and we will have to wait and see how far this technology goes in the next decade.

#Bitcoin Blockchain #What is Blockchain #Blockchain Definition