The blockchain (also known as "the protocol of trust") is a technology that aims at decentralization as a security measure. These are distributed and shared databases and records with the function of creating a global index for all the transactions that are generated in a given market. It works like a reason-book, only in a public, shared and universal way, which creates consensus and trust in direct communication between two parties, that is, without the intermediation of third parties.
What is Blockchain
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The concept of blockchain has its etymological origin in the English language, so Blockchain in Spanish is translated as “ chain of blocks ”, this translation may make a little more sense if you delve into its use.
It is important to note that this arises as a secondary element in what was the revolutionary appearance of bitcoin, and it is a data encoding system that is behind the virtual currency and that is the backbone of it. Some time after the emergence of bitcoin, this currency showed the great potential it has and how easy it is to apply in other sectors that are not financial, such as administration.
One of the main advantages it offers is the fact that its hacking is quite complicated, also the fact that the information is always protected, which means that even though the network was affected, the information will not be harmed, or the services provided through this medium. An example of the distribution is in social networks such as Twitter and Facebook, where the process of identifying the origin of the messages is centralized, in this case it will be replaced by a network of nodes that guarantees the integrity of said data.
Another way to define the blockchain in Spanish "chain of blocks" is as a well distributed and highly secure database thanks to data encryption, which can be used in various types of transactions.
Taking into account the concept of blockchain, one of the requirements for the network to be viable is that there must be various users (nodes) who are in charge of checking the transactions, in order to validate them and that in this way the block to which corresponds said transaction, is registered in the account book so to speak, where the blocks (records) are joined and encrypted to protect the privacy and security of each transaction.
Analyzing the definition of the blockchain and its use, everything could seem positive, however, there are some who consider that it has certain elements that play against it.
In the case of public blockchains, there are questions about trust and who is held accountable in case of issues. While with private blockchains, the unknowns that arise are related to whether companies have the ability and willingness to invest in infrastructure for IT chargebacks, an accounting strategy that is applied to the costs of IT services, such as database transactions, to the trading unit in which they are used.
The blockchain is seen as the main technological innovation of bitcoin since it is the proof of all transactions on the network. His original project has served as inspiration for the emergence of new cryptocurrencies and distributed databases.
The definition of blockchain indicates that it is a type of distributed database that maintains a permanent and infringement-proof record of transactions. The blockchain database consists of two types of records: individual transactions and blocks.
A block is the current part of the blockchain where some or all of the most recent transactions are recorded and once completed it is saved on the blockchain as a permanent database.
Every time a block is completed a new one is generated. There are countless number of blocks in the blockchain that link to each other (like a chain) where each block contains a reference to the previous block.
Blockchain Background
To really know what Blockchain technology represents, it is necessary to go back about 3 centuries, specifically to the year 3200 BC, the time of which the first single entry accounting record is had. These documents would be the ancestors of what today are databases and what also represented the beginning of the registration of information in a systematic way.
Already in the 15th century, the double entry accounting system was created, which was codified within a book that was published in the Italian city of Venice. From then until the 90s, progress was very poor, when the internet emerged and opened the doors to digital blockchain technology. Giving way to what is the definition of blockchain today.
In 1997, Adam Back invented an alternative monetary system called Hashcash, which was based on what could be said as a proof of ideas of the system that would later make the Bitcoin currency famous.
In 1998, systems such as Nick Szabo's Bit Gold and Wei Dai's B-Money appeared. Already by this time the notion of distributed digital capacity is forcefully introduced in order to manage cryptocurrencies.
After more than a decade in 2013, Vitalik Buterin, co-founder of bitcoin magazine and programmer, had the idea of creating a scripting language for bitcoin, in order to develop decentralized applications. However, unable to reach an agreement, Buterin decided to start developing a distributed computing platform, which is based on the ethereum blockchain, which had a scripting-type functionality, called smart contracts.
To be more precise, smart contracts are scripts that are applied and executed within the ethereum blockchain, some of the examples of their use are for carrying out transactions that meet the requirements. These contracts are written in specific programming languages, and in addition they are compiled into byte code, which then a byte machine known as the Ethereum virtual machine is able to read and proceed with its execution.
How the Blockchain works
The Blockchain in Spanish "chain of blocks", has in each of the blocks that compose it, encoded information of a transaction that was carried out on the network. As said before, it is similar to what is done in a ledger, where, for example, the input of an element A and the output of an element B are written.
Blockchain has a similar behavior, but in this case it is the network of distributed nodes, which will be in charge of certifying that said data is real.
Each block that is part of the chain contains a data or information packet, together with two codes, the first to indicate the block that is before and the second to indicate the next block, this means that they are interlaced, which is why they are called hash codes. Now, at this point it is important to mention the spoiled, it is that action carried out by the nodes, which is nothing other than the process of how the information is validated.
During this process, when there are two blocks that point to the same block that precedes them, the one that is first decrypted by most of the nodes will simply win, that is, most of the points in the network they must be in tune to be able to verify the information that is being processed. It is for that reason that even though Blockchain technology produces a large number of blockchains, the chain with the longest length is always legitimate.
Types of Blockchain
When understanding the meaning of blockchain and its uses, it should not be assumed that there is only one type of chain of blocks, since unlike them, there are several types that exist and they differ between one and another by the function they have, consensus protocols that require network flexibility, among others.
Public blockchains
They are, to put it in some way, chains of blocks where you do not have to ask permission for access, such as bitcoin, Litecoin, Ethereum, which are characterized by being transparent, allowing access to any user, to use The only thing that is needed is to download the application, then connect with a certain number of nodes, it should be noted that the identity of the users is protected, there is no administrator, so in order to validate any transaction it is necessary to follow the so-called consensus protocols. They also sometimes offer certain rewards for block mining.
In summary, the meaning of a decentralized blockchain focuses on the fact that all network nodes are the same, it is a distributor, since each node has an updated copy, it is generally and openly consensual, but despite of it is certain.
Private blockchain
Contrary to the public ones, these are called permission blockchains. In general, this type of network is not considered a Blockchain, since in this case control is exercised by a main entity, who is responsible for maintaining the chain, as well as granting permission to users who wish to join. this network, either to propose transactions or to accept blocks.
Taking into account the meaning of private Blockchain, it should be noted that its databases are also protected on a main server, that is, it is not open to the public, it can only be accessed by means of an invitation. The economic industry is the one that is currently making greater use of this type of private network, some examples are Hyper Ledger, Universia, R3, etc.
Federated or hybrid blockchain
These are characterized because they are used by companies and organizations where large sums of money are produced, and governments also tend to use it. They are generally not open to the common public, and their management is the responsibility of a group of organizations. A big difference with public blockchains is that they do not have an associated cryptocurrency and they do not offer rewards for mining blocks.
In the same way, they are distinguished by using open source software, such as Cord, EFW or Hyper Ledger. Some examples of this type of Blockchain network are BigchainDB, Evernym, Enterprise Ethereum Alliance, in the latter companies such as BBVA and Banco Santander participate, which merge the use of Ethereum's public blockchain and the platform they own.
Blockchain used for services
There are companies like Microsoft, IBM, and Amazon that offer the blockchain service through the cloud.
Blockchain-based applications
Finance
Within the scope of the economy, specifically with regard to cryptocurrencies, Blockchain technology serves as a kind of notary public that is not modified, within the entire system of transactions that are carried out, this in order to prevent that the coin be used twice. Some examples of this are the uses that are given to them in virtual currencies such as Ethereum, Bitcoin, Litecoin and Dogecoin, but each one with its distinctive characteristics.
It also serves as a distributed notary in different types of transactions, making them more reliable and secure, while being cheap and easy to track. Some examples are in different payment systems, sending remittances, transactions between banks, digital asset management systems, where it is applied for different purposes, and it also works for loans.
Registration and data verification
On the other hand, in databases, such as name records and the like, the concept of blockchain is used to generate a notary system of name records, in such a way that a name can only be used to locate the object that it has actually registered. This can serve as an alternative to other similar systems, such as the popular DNS.
Immediate execution of Contracts
It is applied as a basis for decentralized platforms, which make it possible to support the emergence of smart contract agreements between different nations. The purpose of this platform is to make it easier for a network of lares to manage its smart contracts that have been created by the users themselves. The first thing that is done is to write a contract through a code, then it is uploaded to the blockchain through a transaction, since it is in the block chain, the contract will have an address through which it is possible to interact with it same. How, for example, Ripple and Ethereum.
Through Blokchain, the cryptographic element called Bulletin Boards is also applied, which is used in the manufacture of registers, discussion forums, electronic voting systems, auctions, among others.
The definition of blockchain in practice has served to solve two essential problems that were related to the transfer of assets that did not have a trustworthy certifying body.
The first of these was to avoid spending double, that is, to avoid being counterfeited and using the same currency twice. And the other is to achieve decentralization of electronic payments, since the realization of secure payments is guaranteed, as well as direct collection between people electronically.
Likewise, trust is another of the intrinsic elements of this system, seen from a legal point of view, Bitcoin can be considered a heritage asset, incorporeal, private, digital in the form of a unit of account, through a computer system and applied as a common unit of measurement, through an agreement of the users of the system.
It is considered an identifiable, fungible and unrepeatable movable property, however divisible. Although it is not money, nor electronic money, nor does it have movable value, it is a patrimonial asset that is considered a common measure within economic exchange systems, characterized by being cooperative, decentralized and closed, completely alien to money. State fiduciary, based on the trust of the users of said network.
Blockchain Wallet
What is Blockchain Wallet
The Blockchain Wallet technology is a wallet that is not subject to any corporation or company, that is, the user is their own wallet, to be a little more explicit, there is no entity that can freeze the funds, since no one has access to bitcoin except the user himself, who is directly responsible for what is in said account.
The Blockchain wallet differs from others of its kind, by the fact that account verification is not required by entering the address, telephone, personal data, even an email is not required. Similarly, despite the fact that most Bitcoin wallets request that deposit transactions be confirmed at least 3 times to be able to use the currency, in the case of Blockchain technology, as soon as the money is received (a despite not having confirmed even once) can be used immediately.
Another concept that is related to the meaning of Blockchain is the side chain or Side Chain, being a lateral block chain that is responsible for the validation of data from a main block chain. It basically serves to offer new functionalities, which can remain in a trial period, based on the trust offered by the main chain. This type of chain works in a similar way to how common coins did with the gold standard. An example of a block that uses side chain is Lisk.
Thanks to the fame of bitcoin and the great reach of its network to offer trust through its consensus algorithm through proof of work, it seeks to take advantage of it as a main blockchain and from there create side chains that serve as support one to the other, so it is extremely important to be clear about the concept and meaning of Blockchain.
How much is the commission in Blockchain Wallet?
To transfer or exchange high-speed Bitcoin, each transaction requests a commission from the blockchain. In general, this fee is low, but despite this, sometimes higher fees are necessary to process the transfer, or failing that, the exchange. Taking into account the above, there are some points that must be taken into consideration.
The first is that the Blockchain fees are not subject to a single factor, on the contrary, there are several that intervene, some of them are the confirmation of the transactions, which are affected by the liquidity providers, another element is congestion in the networks and the size of the transfer, in the latter case it should be noted that depending on the size, a certain amount of kilobytes may be affected when transforming the Bitcoin from different inputs, as is the case of the tap assets and other microtransactions.
Therefore, a higher Blockchain fee may have to be paid if the Bitcoin network is overloaded at the time of the transaction. Generally the rate rises due to sudden modifications in the fluctuations of the Bitcoin rate and the different events in the world.
Other factors are also, if the Bitcoin account that is used has a history of micro-deposits, such as referral bonuses. If the account has a large number of small deposits, the size of the transaction will increase, since it contained many entries. The higher the transfer, so will the Blockchain fee.
