One of the most exciting aspects of blockchain technology is that it is entirely decentralized, rather than stored in one central point. This removes the need for powerful central authorities and instead hands control back to the individual user. Here we will examine how this system works, what it means for our future and why it is so revolutionary.
What is Decentralization in Blockchain?
The decentralized nature of blockchain technology means that it doesn’t rely on a central point of control. A lack of a single authority makes the system fairer and considerably more secure. The way in which data is recorded onto a blockchain epitomizes its most revolutionary quality: its value of decentralization. Rather than relying on a central authority to securely transact with other users, blockchain utilizes innovative consensus protocols across a network of nodes, to validate transactions and record data in a manner that is incorruptible. As a blockchain is a ledger of information it is extremely important that the information being stored is honest and accurate.
What is a Consensus Protocol?
A consensus protocol is a set of rules that describe how the communication and transmission of data between electronic devices, such as nodes, works. Consensus is achieved when enough devices are in agreement about what is true and what should be recorded onto a blockchain. Therefore, consensus protocols are the governing rules that allow devices that are scattered across the world to factually come to an agreement, allowing a blockchain network to function without being corrupted.
As the system does not rely on a central authority, the fees that are normally collected by these organizations are no longer a factor. Therefore, transacting on the blockchain can be seen to be cheaper, as the only costs incurred by the parties involved are the nominal fees used to reward the miner or forgers that run a node on the network.
Furthermore, the information recorded on the blockchain can be certain to be true as it is near impossible to manipulate due to there being multiple copies that require a complex consensus to be edited. On top of that in combination with the role played by cryptographic hash functions in the system.
The data is made even more secure by the fact that there is no reliance on a central point of storage, reducing the risk of it being lost or destroyed. Attacking one point of storage would result in no loss of data since all the information is stored on multiple devices around the world. In this regard Bitcoin is the most weathered and resilient platform in the space, having withstood barrages of attempted hacks, all of which have been unsuccessful.
Those who participate in the blockchain network have the option to contribute their computer storage and download a copy of the blockchain to secure the data that is recorded on it.