What is Blockchain Technology & How Does it Work?

What is Blockchain

What is Blockchain technology, and why is everyone talking about it?

Blockchain enables computers to communicate perfectly through nodes and allows validations to be shared by each computer on the network. In that way, the principle involves solving the Byzantine general problem. With blockchain, a user can send information to another user without using a human intermediary. 

The word Blockchain became famous when an anonymous man Satoshi Nakamoto created a digital ledger system that allows peer-to-peer sharing of information between two users. Satoshi’s achievement was incredible because users couldn’t manipulate or hack the system. The anonymous man created his magic internet money known as Bitcoin through his findings.

Byzantine general problem?

Let’s analyze the Byzantine general problem with a simple analogy, two generals from the same city command their enemy city through opposite city gates. The major problem is that they must communicate the time of the attack mode at a particular time to ensure victory. 

Another problem is that one of the generals must share the form of the attack through an enemy city, and the general must send one or more foot soldiers through the enemy city. Still, he must ensure that the enemy hasn’t tampered with the information. 

Using a computer-based example, how can I send information through networks and ensure that the correct information reaches the right person? The answer lies in public-key encryption and cryptographic security.

Public-key encryption determines a user’s identity, while cryptographic security protects the data. The private key is like a password that gives cryptocurrency ownership, meaning a user must not share his private key to secure his funds. 

How does blockchain work? 

A blockchain transaction is secured by a block connected to other blocks by its hash value. With that, there is a need for cryptographic puzzles created by those blocks to be solved by miners. The miner who solves the puzzle via a consensus mechanism receives a reward for his contribution to the network, known as Proof of Work (PoW).

Fuse Blockchain  

One of the most important applications of blockchain is that it allows people to send money across the world without intermediaries. Fuse is a decentralized blockchain platform that enables mass applications of crypto payments and decentralized finance (DeFi). The current financial system can’t provide millions of people with fast and reliable payment systems. 

Crypto payment companies are not solving the problem either. Most of the systems they create are too complicated for non-technical users. We aim to bring DeFi and crypto payments to the masses by empowering businesses, projects, organizations, and communities to adopt crypto payments and DeFi. We have achieved that by providing mobile-friendly tools that enable users to interact with token-powered environments. 

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