What is the Blockchain Technology explained for Dummies? This is a question that many people who have heard about the potential uses of the Blockchains will ask. But most people really don’t understand it.
The word “blockchain” can mean many things to many people, but in this article, we’ll be focusing on just one of its many potential applications. That focus is on the latest venture between PayPal and Elon Musk’s Binance.
## In its simplest form, the Blockchain is a distributed ledger, similar to those used in banks and other financial institutions.
Rather than having all transactions happen on a central computer network like how the Internet works, the Blockchains are made online. Rather than being stored in one location or computer system, the data for all the transactions occur in a series of several computers throughout the Internet, known as the “peer-to-peer” network. However, unlike the Internet, the Blockchains are decentralized. There is no singular location where all the transactions take place.
## How does this relate to the use of the Blockchains?
Well, the Blockchains work much like how the Internet functions. Anybody can create a website and post content onto it. In order to access the website, people send their information to the website owner. Once the owner accesses the information, they can either give permission for others to read what is posted or they can delete the post. This is similar to how the Internet works.
## But how does it differ from the Internet?
First of all, the Blockchains are much more secure than the Internet because everyone is constantly communicating. In addition, the Blockchains are much more flexible as well. Anyone can create a new application or use a certain piece of software, which means that there isn’t a single company that owns the entire distribution of the distributed ledger. The possibilities are endless!
What do these two differences mean for someone who is interested in becoming involved with the decentralized aspect of the Internet? It means that you will be able to participate in the open development process. Every new application and every new piece of software will be made available to the public. The developers will be allowed to add their modifications and make their applications compatible with the existing software. Therefore, there will never be a need to pay for a proprietary license.
One of the most exciting aspects of participating in the open development process is the ability to build things based on your own preferences. If you are the type of person who is good at creating products, then you might want to create your own product and sell it online. Or, maybe you are the type of person who is really good at developing websites. You could hire someone to do this for you! Regardless of your skills, you will have an opportunity to do something that you are passionate about.
Another exciting benefit of the decentralized system is that the protocol that underlies the distributed ledger is very robust and efficient. Because of this, the network will be very trustworthy. Therefore, it will be easy for people to transact using the system. Again, this makes it a good platform for businesses.
## The last benefit is probably the most interesting.
Because the entire process is completely decentralized, it opens up the door for new economic models. Some people envision new business models where consumers will pay sellers instantaneously for products that they wish to buy.
Others are interested in using the distributed ledger to start their own companies, where the money that they send to the business is deposited into a special account and it earns interest.