Understanding Blockchain Tech and its Effect on Finance and the World
What is Blockchain tech?
Blockchain technology is a distributed ledger technology that underlies cryptocurrencies such as Bitcoin, Ethereum, IOTA, and Komodo. Using the blockchain is a safe and reliable way to conduct auditable transactions. Unlike relying on a single party to be held responsible for transactions, blockchain provides a decentralized way to conduct transactions.
With a distributed ledger, in order to hack into a transaction, you would have to hack into that ledger which is stored on thousands of individual computers. Advanced cryptography is used to protect data. In short, it would be extremely difficult and nearly impossible to hack into the blockchain, making it secure. It can be utilized anywhere in the world that has access to the blockchain file.
Also, there is not one single blockchain but many, both public and private. The blockchain is the technology behind cryptocurrency. Rather than having a centralized location, every “block” is an ordered record on the chain with a timestamp and a link to a previous “block”. The blockchain offers a new way to manage trust and is a viable way to verify someone’s identity. This could be useful to the insurance industry where quick verifications are beneficial. Information stored on the blockchain is not subject to human error.
Miners and the role they play in the blockchain
Every single miner has their own copy of the ledger which makes up the entire blockchain. The collection of ledgers itself is the blockchain, every transaction is stored on it. The blockchain enables the ability to transfer.
New bitcoins are created and awarded to miners for their participation. When a miner decides to use their computer towards solving complex equations in the blockchain, they are awarded with bitcoin. Solving the equations is called mining. Therefore, those who use their computers for this purpose are called miners.
In order to obtain or invest in cryptocurrency, you’ll need a wallet such as Xapo. There are a number of different wallets available to choose from with a simple search.
How will it disrupt the financial markets?
Blockchain technology will disrupt a number of industries including the financial industry. This technology grants access to anyone in the world including those who are considered unbankable. Anyone in the world can send or receive money using this system which opens up many options for payments and banking. Even large banks are beginning to invest in their own blockchain systems.
The blockchain has already begun reshaping the financial industry as a whole. As predicted by the World Economic Forum, at least 10% of the GDP will be in the blockchain or related tech by 2025. It is very significant how the blockchain can be used to prevent fraud. Centralized databases are quite vulnerable. This is why 45% of intermediaries such as money transfer services and stock exchanges suffer from economic crime or cyber attacks each year.
Financial institutions have a responsibility known as Know Your Customer. Billions of dollars are spent each year to identify clients in order to avert money laundering. Compliance departments of financial institutions stand to save a lot of money by utilizing blockchain technology to eliminate fraud. Blockchain affects the Know Your Customer policy by independently verifying and identifying a client so it wouldn’t need to be done again. Once a client is identified, the information can be accessed by the appropriate organization.
How to invest in the Blockchain
Coinbase has made it easy to invest in the cryptocurrency of your choice on the blockchain. The choices are many, you can choose between hundreds if not thousands of different cryptocurrencies. When you’re ready to invest in a particular currency, take the time to study it in depth to make the best choice. There are a number of different cryptocurrency Facebook groups where you can connect with likeminded people and discuss the blockchain. There are also Slack groups you can join for the same purpose.
Future opportunities with InfluenceMine
New companies such as Influence Mine cryptocurrency are setting the new standard for up and coming green ICO’s. We will be writing more about them as they become public. They are said to be creating coin through hydromining processes. They have not made an official release, but we look forward to coving it if it ever happens.
Blockchain is expected to disrupt a number of other markets, as it already has. Voting, could be used for registration and identity verification. It would also lead to an immutable ledger which can’t be argued with when it comes to counting votes. All transactions are stored on every ledger across the blockchain.