What are some problems blockchain technology solves?

It should be no surprise to an individual who is experienced in the field of cryptocurrency that blockchain technology has had a substantial impact on how the trading system works. With it, we have made fantastic strides concerning bitcoin and the development of innovations such as smart contracts and decentralized applications.

However, if you are someone who is unfamiliar with the concept or are only aware of the basics, you might be wondering, “What is so special about blockchain? What exactly can it do for me?” Neither question can be answered with just a basic definition; there are layers to this concept that are what make blockchain the revolutionary digital apparatus it is.

What is blockchain?

Before we get into clarifying blockchain’s benefits, it is only fitting – and appropriate – that we first explain what blockchain technology is. At its core, blockchain is a system of transactions that are made with cryptocurrency and are maintained throughout a series of computers that are connected together in a peer network. Getting down to the quintessence, it is a list of records (the titular “blocks”) that are linked with cryptography. A whole community of users can control how the information distributed is updated and adjusted.

As this is a decentralized system, there is no need to involve a third party or middlemen with the transaction processes. While on the surface this may appear to be a risky structure, it actually provides the users with a sense of reliability and authenticity.

One of the technologies that birthed blockchain back in 2008 is called ‘Private Key Cryptography.’ In blockchain, there are two types of keys: a public key and a private key. The public key is how others identify you and also represents your wallet address, and the private key is what allows you to digitally authorize various actions (transfers, withdrawals, etc.) based on your public key. Both of these components combined to give you a digital signature.

How blockchain works

The details that reside within the definition of blockchain technology may come across as excessive, but in reality, using this system is quite simple. In a rudimentary form of illustration, it is a string of blocks strung together. To be technical, it works as follows:

  1. A transaction is made.
  2. The transaction must then be verified.
  3. The transaction is stored in a block. The dollar amount, your digital signature, and the site’s digital signature (let’s say for example your transaction was made on Amazon) are all stored in this block.
  4. The block is given a hash (a code whose function is to map data of various sizes), at which time the block is then added to the blockchain.

The benefits of blockchain technology

Overall, blockchain provides a sense of trust among all parties involved, and it is equipped with a feeling of ownership due largely in part to the keys. By being granted possession of these digital tools, the user is able to fulfill requirements surrounding authenticity; an element that is not provided at the best of times when a third party or a middleman is involved.

Undoubtedly, there is much more to be given and implemented through blockchain. Authenticity is arguably nothing without authorization, and authorization is a pivotal factor in assuring that a system such as this is indeed a reliable one. Due to blockchain operating on a peer-to-peer network, it greatly reduces failure that would be brought upon by that of a centralized system.

Potential uses for blockchain technology

The potential uses for blockchain go beyond the prominent usage for monetary transactions. Some locations use this technology as a means to run a system of records.

  • Government use – There is the obvious overseeing of ownership rights pertaining to the cryptographic key, but there is also the authorization of transactions.
  • Digital identification – Cryptographic keys create the foundation to build digital relationships, thus allowing a new way to manage one’s digital identity and personal information.
  • Medical records – A medical record can be implemented into the blockchain after it is verified, making it difficult to be altered and ensuring the integrity of the record.
  • Agriculture – In regards to food safety, blockchain will provide the tools needed to track down sources and establish ideal conditions in farms and markets so that an outbreak can be prevented.

HedgeTrade & Blockchain

If one wishes for proof of the reliability of this technology, look no further than HedgeTrade.

HedgeTrade is a forecasting platform that functions as a way to allow traders of all sorts to post predictions about varying subjects. A noteworthy selling feature of this system is its ability to hold forecasters accountable through the use of blockchain. It utilizes records by way of this technology to build a transparent and reliable system for all users.

As is typical with other trading and forecasting platforms, HedgeTrade has its own unique way of how it operates.

  1. Acquire the tokens. Traders and users usually buy with bitcoin, however, users can purchase HEDG tokens from an exchange such as CoinTigerHotbit or Bancor.
  2. Stake HEDG on Blueprint, which is otherwise known as ‘trading prediction.’
  3. Create the Blueprint. Users can then unlock the prediction details with the usage of HEDG tokens.
  4. Users proceed to wait for expiry, which is when the Oracle will resolve the Blueprint.
  5. Outcome of Blueprint. During this stage, the HEDG tokens are automatically distributed to the trader if the Blueprint is correct. If it is incorrect, the tokens are promptly returned to the users.

Conclusion

All in all, blockchain technology is a system that is constantly being developed in new and innovative ways and produces by-products that are equally as beneficial in design and function. What remains the same throughout these recurring progressions is its dependability. Its mere existence is the solution to those who would prefer not to deal with any hassles, ranging from middlemen to inefficient distributions of information. It functions autonomously and relies on a community rather than a third party or a singular entity. It gives countless issues pertaining to storage, voting, governance, and transactions a digital solution.

Sources:
https://www.coindesk.com/information/what-is-blockchain-technology
https://www.investinblockchain.com/what-is-blockchain-technology/
https://www.investopedia.com/terms/b/blockchain.asp
https://hedgetrade.com/pages/how-it-works
https://www.coindesk.com/information/applications-use-cases-blockchains
https://www.forbes.com/sites/ciocentral/2018/08/05/will-blockchain-transform-healthcare/#ec1d240553d3
https://futureofag.com/5-potential-use-cases-for-blockchain-in-agriculture-c88d4d2207e8