First things first…..it was not Bitcoin that excited me, initially, it was Blockchain.

The realisation was that this innovative technology has so much scope to change the way we do things. It is not an exaggeration to say that Blockchain will have an impact on all sectors of business, which in turn will affect the way we live.

Let's see how this amazing technology works, and what real life examples already show that Blockchain is here to stay.

Oh and it may surprise you to learn that we are not starting off with Bitcoin.

Yes the two 'B's, Blockchain and Bitcoin are     inextricably linked.

However there is so much more to this technology than being the basis upon which the worlds largest cryptocurrency operates. Industries as diverse as Cybersecurity Marketing & advertising, Supply-chain management, Government systems, Music and video sharing, E-commerce and even Voting for elections. 

Is it too complicated to understand?....The short answer is no.

Okay, yes it is one of the most puzzling questions we find ourselves trying to answer when first discovering cryptocurrencies. So grabbing an understanding of Blockchain is essential.

So in simple terms the main purpose of the Blockchain is to allow fast, secure and transparent
peer-to-peer transactions (Point A to Point B)

It is a trusted, decentralised network that allows for the transfer of digital values such as currency and data. Let's get even more basic…..so how does Blockchain actually work?

¨ Think of it as a large database that is shared across a network of computers which are called 'nodes'.

¨ The nodes on the network work together to verify transactions (by using complicated maths) and are
 rewarded with that verification by receiving that Blockchain’s currency.

¨ This is a process known as mining. 51%+ of the nodes on the network have to basically authorise each and every transaction.

¨ Once a transaction is verified by the network, the transaction is placed in a block of transactions.

¨ New transaction blocks are placed — in order — below the previous block of transactions

¨ This creates 'the Blockchain'. (the clue is in the name)

¨ All transactions are stored in a distributed database, which is the ledger. No one entity has control over it, which makes it really cool

¨ It is extremely difficult for a hacker to change the transactions because they need control of more than half of the computers on the network.

It may be even easier if you imagine a Blockchain as an Excel spreadsheet.

This spreadsheet/database is typically shared across a large network. It is completely public and operated by a number of 'nodes' (computers). The more nodes there are, the more secure this database is. Every time the network (nodes) makes an update to the database, it is automatically updated and downloaded to every computer on the network. Everyone can see what's going on.

Blockchain technology is secured with cryptographic techniques, making it near impossible for hackers to make changes to it. It's all about very complicated mathematics. To make changes to this network (or Blockchain) hackers would have to take control of over 50% of the nodes, an impossible task.

Forget cryptocurrency for a moment

Here's a simple example to explain Blockchain a little better.

Let’s compare how data is stored and shared in standard (non-Blockchain) systems, to how it is stored and shared in a Blockchain system.

The way that traditional (non-Blockchain) ledgers work is very similar to the way you would share a Microsoft Word document with your friend:

While you are editing the document, your friend is locked out and cannot make changes. Then once you have finished making your changes, you send it to your friend to edit it further.

Now while your friend is editing the document, you are locked out and cannot make changes until they are finished and send it back to you.

So in Blockchain system, however, all users can view the changes while they are being made. The data is accessible in a secure and shared environment, instead of being locked to one company or person at a time (at the risk of losing the data).

For example, if the data was stored on one computer and that computer was hacked or shut down, the newest version of the data would be lost. In other words the word document would be lost forever.

However…..

With the Blockchain, the data is stored on all the computers/nodes that run it. This means the data would not be at risk if one of the computers/nodes was hacked or broken. The word document is edited simultaneously. Everyone can see it. So as you can start to see, Blockchain technology does not just benefit cryptocurrencies.

It is benefiting, and will benefit, many different industries. Imagine the amounts of legal, health, accounts and customer data, etc. that should be used this way.

This technology really is going to change the way we do things…..