Even though I am a crypto enthusiast, I never really knew what a blockchain was. It was with a lot of effort it took me a shitload of time to unravel the mystery behind the concept of blockchain. So I thought, that there might be others, like me, who are new to this digital crypto world who know nothing about what a blockchain is and how it works. This post is for them.
WHAT IS A BLOCKCHAIN?
A blockchain is a list of record that keeps on growing indefinitely and is linked together using cryptography.
WHAT IS A BLOCK?
A block is a record of data. It contains a summary of the previous block (called the cryptographic hash), a timestamp, and a transaction data. The data stored is resistant to modification.
Blockchain is an open ledger that can record transactions between 2 parties efficiently and in a verifiable and a permanent way.
DECENTRALIZATION
Since the data is stored in multiple blocks, there is no accumulation of data, and hence, comes with lesser risk.
KEYS
There are 2 types of keys.
- Private key
- Public key
A private key is a list of random looking words that are arranged in a particular order and gives access to digital assets to their owners.
A public key, however, is a group of random numbers that denote a blockchain. Tokens belonging to a particular blockchain will have the same address.
USES.
- Cryptocurrencies
- Smart contracts
- Financial services
- Video games
- Supply chain
- Domain names
The need for internal audit to provide effective oversight of organizational efficiency will require a change in the way that information is accessed in new formats. The Internal Audit Foundation study, Blockchain and Internal Audit, assesses the risk factors.
So I think you might now have a vague idea on what a blockchain is and how it works. Stay tuned for further updates.
