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Blockchain

Blockchain Explained: The Pillars of Blockchain Technology

The blockchain is embedded with eight pillars to ensure financial sustainability in online transactions. These pillars are critical to the blockchain’s operation and are therefore explained more below:

  1. Decentralization: There is no single authority, entity, or government that controls the blockchain. The Bitcoin blockchain is a decentralized, permissionless network.
  2. Distributed Ledger: The blockchain is shared, or distributed, across a network of users. This prevents data loss since many users, or computer nodes, have a copy of the ledger.
  3. Validation Procedures: Individuals and businesses can verify and validate data transferred to the blockchain.
  4. Finality: The information on the blockchain cannot be modified or cancelled. It is final.
  5. Immutability: Transaction data cannot be altered. If someone tries to change data on the blockchain, the entire hash, and the hash of the prior block will change, and the other nodes will notice this change and not allow it to happen.
  6. Consensus Algorithm: Blocks are created using a consensus method such as proof-of-work or proof-of-stake. Once a consensus is reached, the block is transferred to the blockchain.
  7. Secure: The blockchain is resilient to hacking, tampering, and cyberattacks.
  8. Transparency: Transactions on the blockchain are visible to all users across the network and can be easily tracked.

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