Many individuals ask the same question, “Why does Blockchain exist?” The reason is that many individuals are still not very well acquainted with how Blockchains work. It is also very important to note that a majority of those asking the question have not even attempted to understand what it is. Thus, in this article, we will be exploring why do Blockchains exist?
How do blockchains work? A traditional database management system (DBMS) maintains the records for all transactions that have occurred. It is basically a collection of computer codes that allow software to be programmed to perform certain tasks. For instance, when you purchase food from your favorite restaurant, you would enter in your credit card number and choose from among the list of items offered. A database of this type is called a block chain.
In a traditional system, every transaction is stored in a separate location. This means that every transaction has to be entered, reviewed, and added to the main database before being sent to any part of the system. If something goes wrong, then all transactions from that point on would be considered invalid. These systems do have some inherent weaknesses. For instance, if there is an error in the programming code, there is a possibility that the entire system could be messed up as well.
Due to its inherent weakness, a traditional database management system cannot stand alone. What happens is that one or more computers that are linked together in the network will need to confirm the validity of every other computer. If a third party wants to transact with another party, they have to go through all the other computers first before getting their transaction confirmed. This proves to be very time consuming. What’s more, because transactions are recorded on-chain, it takes a long time to develop. Hence, the time factor becomes very important for the end user.
A solution to this problem is to use a Distributed Ledger System (DLS). What is a DLS? It is a ledger/ledger system that tracks the information on a series of interconnecting ledges. Each of these ledges corresponds to a unique protocol address.
How does a DLS work? Let’s say that Alice starts the transaction. Alice sends a transaction request to the transaction host. At the transaction host, an agent receives the transaction request. If the transaction request is valid, then the agent broadcasts the transaction to all the nodes in the system. Once this happens, each node will then check the transaction protocol address for the match.
If all the nodes to find that the transaction is legitimate, then the transaction will be approved and it will be propagated to the rest of the nodes in the system. So, only Alice would have to pay the amount she originally requested. However, if the transaction would go unsuccessful, Alice would still be responsible for paying for it. This way, Alice can avoid spending money unnecessarily as well as avoiding spending unnecessary gas. If the protocol rule used is followed, there won’t be many problems.
Now, let’s return back to the original question: why does Blockchain exist? The protocol that allows us to transact without intermediaries is called “blockchain.” This is actually a series of computers and servers collaborating together in a network to prevent double-spending. Transactions are completed through a special address, which is referred to as the “Segurator.” The Segurator is constantly monitored by hundreds of thousands of nodes that ensure that the transactions are kept secure and fair.
With the help of this protocol, people will no longer need brokers or middlemen in order to complete transactions. When a buyer requests information regarding a particular product, he/she may go directly to the producer. If he/she wants to order another item, then he/she would contact the retailer. But with the help of this protocol, everything will be automated so that the whole transaction process will be one of a simple demand-for-service basis.
Once the transactions are processed, only one address would be used for all the transactions. This is also one of the main reasons why it’s considered to be the most efficient technique nowadays. Imagine someone asking you for five dollars. Well, if you would perform the transaction over the phone, you would need to give the five dollars to a different number and would receive ten dollars back.
This is exactly how it works with the Blockchains Protocol. Therefore, the transaction costs will be eliminated. At this very moment, it would be very difficult for people to manipulate the network because once the network is programmed, then it cannot be changed. The fact that there is no centralization means that there is no way for someone to take control of the system. With the protocol being programmed correctly, every transaction is secure and there is no way for anyone to get any sort of benefits from your activities.
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