People often confuse blockchain with bitcoins. However, Bitcoin is one of several cryptocurrencies worldwide, and Cryptocurrency works on the fundamental concept of blockchain technology, a type of cryptography!
Blockchain Technology means a decentralized, distributed ledger that can record transactions for a digital asset connected worldwide with the internet. It is managed by a peer-to-peer network using standard protocols governing its core principles. It's also known as DLT or Distributed Ledger Technology.
Blockchain typically consists of blocks combined using cryptography with unique features like unalterable, timestamp, and transaction data.
Need for Blockchain Technology
Accountability: With blockchain, when two or more people enter a transaction, their digital identity is known, and therefore, they can easily transact without worrying about fraud. Also, since the data can't have tampered all parties in the transaction don't need to worry about details like amount, quantity, etc. Therefore, there could be greater accountability between parties.
Security: Security is one of the major factors people fear when getting into a monetary or other transaction from another country. With blockchain technology, there is no single point where all data is stored as decentralized. Therefore, it becomes fundamentally difficult for someone to hack into a system and access systems like centralized databases of banks and other financial institutions.
Record Keeping: With blockchain, it's fundamental that all transactions happening peer to peer have a trace and are stored forever in the decentralized ledger database. Therefore, one need not worry about data being compromised or erased and is always available for analysis.
Cost Reduction: Since the core idea behind blockchain technology is to eliminate intermediaries, there is greater efficiency in almost all transactions. Imagine sending money through blockchain as a cryptocurrency from one country to another without the involvement of banks, Central banks, watchdogs, other institutions, and various restrictions on usage.
Applications of Blockchain
Banking: No other industry stands to gain from blockchain as much as the banking Industry. Without any time limitations usually implied by banks for practical reasons, by incorporating blockchain, they can process transactions after working hours and during holidays in a matter of seconds.
Cryptocurrency: Cryptocurrency is fundamentally based on blockchain technology, and various cryptocurrencies have come up over the last several years like bitcoin, Ethereum, Litecoin, etc. For every country like India, there is a central bank that issues its currencies and promises to earn the worth of the currencies it issues to whoever holds it. However, what if the central banks were to fail? Who shall fulfill that promise? Out of this worry, the Cryptocurrency bitcoin was formed where there was no need for a central bank to regulate the crypto. Its value could be assigned by simple demand-supply analysis by listing it in an exchange.
Healthcare and Legal Use: Any field where data is of utmost importance can use blockchain to store such data as then it cannot be tampered with and can be stored securely and forever. The healthcare industry can store vital patient information using blockchain, whereas Lawyers can also store information about their legal proceedings and case findings.
Having a working knowledge of various Distributed Systems, Networking, and Data Structures is important. Also, understanding cryptography is beneficial.
Anyone interested in becoming a blockchain Developer can learn the technology as an immense opportunity lies ahead in almost every field. Also, it is especially beneficial to people who are learning or an expert in ML, AI, and Data Science fields.