The Three Generations Of Blockchain Technology
What are the three generations of blockchain technology? Get to know more about blockchain technology.A sincere write up on the game changing technology of today.
What Is Blockchain?
Why call this technology blockchain in case it is so complex? Blockchain technology at its most basic level is just a chain of blocks whereas not in the traditional sense of these words. We are talking about digital transformation when we say the words block and chain stored in a public database. On the blockchain, blocks are made up of digital pieces of information, which are specifically coming in three parts.
Storing information about transactions, blocks have the date, time and dollar amount of the most recent purchase from Amazon.
Also, they carry information about who is participating in transactions. The block related to the purchase from Amazon records the name. Using a digital signature sort of like a username, instead of the actual name, the purchase is recorded without any identifying information
While the blockchain technology stores information that distinguishes them from one another blocks store unique code called a hash allowing us to tell it apart from every other block. As cryptographic codes, hashes are created by special algorithms, as the details of the new transaction are likely to look nearly identical to the earlier purchases that help tell the blocks apart as unique codes.
The reality is a little different as the block in the example above is being used to store a single purchase from Amazon. It can store up to 1MB data with a single block on the Bitcoin blockchain, depending on the size of transactions meaning a single block can house a few thousand transactions under one roof.
Looking back on the development of blockchain and dividing it into stages, marked off by important developments and inventions, the blockchain technology not only exist for a fraction of time that the internet has as also likely that there are still important developments to come. Experts divide the history of blockchain into at least three important stages.
Stage 1: Bitcoin And Digital Currencies
Satoshi Nakamoto outlined the blockchain as we know it in the white paper for BTC as a pseudonymous developer while the ideas going into blockchain were swirling around in computer science communities. Thus the blockchain technology began with Bitcoin as the digital currency advancing the goals of digital currencies more broadly.
Blockchain was set up in the earliest stages as the basic premise of shared public ledger supporting a cryptocurrency network. With the idea of blockchain making use of 1 megabyte, the blocks of information on Bitcoin transactions, are linked together through complex cryptographic verification processes forming an immutable chain. In its earliest guises, blockchain technology is set up of many central features of these systems, remaining today as the Bitcoin’s blockchain largely unchanged from the earliest efforts.
Stage 2: Smart Contracts
As time goes on the developers began to believe that blockchain does more than simply document transactions as founders of Ethereum, for instance, had the idea that assets and trust agreements benefit from blockchain management. Thus Ethereum represents the second generation of blockchain technology.
With major innovation, that was brought about by Ethereum, it was the advent of smart contracts in the mainstream business world managed between two separate entities that were some times with other entities assisting in the oversight process. Those self-managing on the blockchain are smart contracts triggered by an event like the passing of expiration date or achievement of particular price goal in response to managing itself making adjustments as needed and without the input of outside entities.
Many analysts in this technology believe that we are still in the process of harnessing the untapped potential of smart contracts while we have truly moved on to the subsequent stage of development of blockchain that is debatable.
Stage 3: The Future
Scaling is one of the most important issues facing blockchain as Bitcoin remains troubled by transaction processing times and the possible bottlenecking. Most of the new digital currencies that have attempted to revise blockchain to accommodate these issues with varying degrees of success have in the future come up with one of the most important developments paving the way for blockchain technology going forward likely having to do with scalability.
The Final Words Before Wrapping Up
New applications of blockchain technology are being discovered as beyond this, implemented all the time. Where these developments lead the technology and cryptocurrency industry as a whole is the difficulty in the process, as a whole with supporters of blockchain likely to find an incredibly exciting perspective living in a moment with an epochal technology continuing to grow and unfold.