Blockchain is a way of storing data or a digital register of transactions, transactions, contracts. All that needs a separate independent record and, if necessary, verification. In the blockroom you can store data on loans issued, property rights, traffic violations, marriages. That is, almost everything. Its main difference and undeniable advantage is that this registry is not stored in any one place. It is distributed among several hundreds and even thousands of computers all over the world. Any user of this network can have free access to the current version of the registry, which makes it transparent to all participants.
How does Blockchain work?
Digital records are combined into “blocks”, which are then linked cryptographically and chronologically into a “chain” using complex mathematical algorithms. Each block is associated with the previous one and contains a set of records. New blocks are always added strictly to the end of the chain.
The encryption process, known as hashing, is performed by a large number of different computers running on the same network. If, as a result of their calculations, they all receive the same result, the block is assigned a unique digital signature (signature). As soon as the registry is updated and a new block is formed, it can no longer be changed. Thus, it is impossible to forge it. You can only add new entries to it. It is important to consider that the registry is updated on all computers on the network at the same time.
What’s special about Blockchain technology?
The distributed nature of Blockchain databases makes it almost impossible for hackers to be hacked, because for this they need to simultaneously access database copies on all computers on the network. Technology also allows you to secure personal data, because the hashing process is irreversible. If even the original document or transaction is later changed, they will receive a different digital signature as a result, which signals a mismatch in the system.
The technology of blocking is based on crypto-currencies, in particular, bitkoyn and light-kun, the database of DNS records Namecoin and Emercoin.
In 2014 the company Bitnation was established, which provides services of the traditional state, such as identity cards, notaries and several others.
In June 2016, the Swedish Land Register reported that the organization is testing this technology in order to translate the database of land plots in Sweden into its basis.
A special parameter called “complexity” is responsible for the requirement for block hashes. Since the computing power of the network is unstable, this parameter is recalculated by the network clients every 2016 blocks in such a way as to maintain the average blocking block formation rate at 2016 blocks in two weeks. Thus, 1 block should be created approximately once every ten minutes. In practice, when the computing power of the network grows – the corresponding time intervals are shorter, and when it decreases – longer. Recalculation of the complexity with time-binding is possible due to the presence of the time of their creation in the header of the blocks. It is written in Unix-format according to the system clock of the author of the block (if the block is created in the pool, then by the system clock of the server of this pool).