Stuart Haber and W. Scott Stornetta, two researchers interested in implementing a system where document timestamps could not be altered, first proposed the concept of blockchain technology in 1991. But blockchain didn’t have its first practical use until over two decades later, with the introduction of Bitcoin in January 2009.
On a blockchain, the Bitcoin protocol is constructed. Bitcoin’s anonymous founder, Satoshi Nakamoto, described the digital currency as “a new electronic cash system that’s peer-to-peer, with no trusted third party” in a research paper introducing it.
It’s important to note that blockchain is only utilized by Bitcoin to immutably record a ledger of payments transparently. In theory, though, blockchain could be used to immutably record any number of data points. This could take the shape of transactions, votes in elections, goods inventories, state identifications, deeds to properties, and much more, as was previously said.
In addition to recording transactions, tens of thousands of projects are currently working to utilize blockchain technology in several other ways to benefit society. One such application is a secure voting system for democratic elections. The immutability of blockchain technology makes it much more difficult to conduct fraudulent voting. For instance, a voting process might be designed so that each nation’s citizen receives a single coin or token. The voters would then deposit their token or cryptocurrency to the address of whatever candidate they wish to support. Each candidate would then be granted a unique wallet address. Blockchain’s transparency and traceability would do away with the necessity for manual vote counting as well as criminals’ capacity to tamper with actual votes.
What is Blockchain?
A blockchain is a group of documents or an online database that resembles a spreadsheet. In contrast to a standard spreadsheet, a blockchain may contain far larger amounts of data, such as records of cryptocurrency transactions, organized into “blocks” or groups.
A “distributed ledger” or several computers are used to distribute these blocks. Each block is “chained” to a previously filled block after it exceeds its storage limit, at which point a new block is put to use.
What is Cryptocurrency?
The digital currency known as cryptocurrency has a market value similar to other currencies. Similar to gold, cryptocurrencies can also be employed as a store of value. The first cryptocurrency and forerunner of blockchain technology was Bitcoin.
Later, several cryptocurrencies developed their blockchains, including Ether (known as Ethereum).
Differences Between Blockchain and Cryptocurrency
Fundamental Nature
Data storage using blockchain is a technique used in decentralized networks. Like the US dollar, cryptocurrency serves as a medium of exchange. Beyond cryptocurrency transaction records, a blockchain can be used to store various other sorts of data.
Financial Value
Every cryptocurrency has a monetary worth. You’ve probably heard about Bitcoin reaching a high of $65,000 (equivalent to 48 lakh rupees) or Ether reaching a high of $4,000. (about 3 lac rupees). A blockchain is not worth anything financially.
Usage
Beyond cryptocurrencies, blockchain technology has other applications. Blockchain can be used to track transactions in the healthcare, retail, supply chain, and financial industries. A cryptocurrency is a form of virtual cash that may be invested in as well as utilized to purchase products and services.
Mobility
The use of blockchain technology is global and decentralized. All of a blockchain’s records are not kept in a single place. Despite being stored in blockchains, cryptocurrency can be accessed through mobile wallets. If you have a bitcoin wallet, you can use it wherever merchants who accept bitcoins are located.
Transparency
Being a public ledger, blockchain offers a great level of transparency. Anyone can sign up for a blockchain network and access the data there. Cryptocurrencies, on the other hand, provide anonymity. Because of this, no one can tell who is behind a bitcoin transaction, even though anyone can see its source and destination.
