What is the Main Purpose of Blockchain?

BlockchainNetworkComputer Network

Introduction

Blockchains often referred to as Distributed Ledger Technology (DLT), are distributed databases shared among computer network nodes. The blockchains are considered to be safe as they do not allow editing and can just be shared. Furthermore, in blockchains, the records of transactions cannot be destroyed or deleted.

History of blockchains

The blockchains have become the foundation of record-keeping systems gaining recognition some 10 years back. There was not a single brain behind the entire blockchain system; it was a cumulative effort of people who were behind the cash currency bitcoin and had the pseudonym of Satoshi Nakamoto. In 2008, the workers behind this released the model for a blockchain.

What are the purposes of blockchains? 

There are many applications of blockchains that one can learn about. Their purposes and uses are vital in many technical fields and help make many processes and works more accessible. Some of these purposes and benefits are −

Easy money transfers

Digitalisation and shifting of the bulk of things to the online mode have made money transfers available online. Various platforms and applications support this and are easy to use. The payments are end-to-end and secure in every way. OTPs are sent to your registered mobile number.

That takes a lot of time and costs you more. Blockchain technology has made it easier, cheaper, and faster. Transferring money from one account to the other takes just a few minutes.

To make lending more accessible

Lending and borrowing have also become easier with the help of blockchains. The lenders looking for people to borrow from can manage the collateralised loans through intelligent contracts. These contracts will favour both the lender and the borrower. Margin calls, smart management of the accounts, service payment, complete repayment of the loan, the release of collateral, etc., are easily taken care of. Better deals are available, and the lender might give you the amount at better rates, making it even more affordable and convenient. The loan processing goes faster, and the entire process doesn't cost you much.

Safer and smoother financial exchanges

The cryptocurrency exchange is a popular thing done in the present times. Since cryptocurrency has become popular and highly embraced, cryptocurrency exchanges have become very common. Many platforms have been launched that favour the decentralised cryptocurrency exchange. It gives you greater authority over your cryptocurrency and other related aspects. The transactions cost you less than the other methods you can opt for and are quite fast. Giving you the bulk of authority over your money, you can make financial exchanges easily and comfortably. Moreover, it saves your time and helps you to manage your financial exchanges in a better way.

Providing transparency in insurance

Insurance providers and customers also get a platform through blockchain technology to have a safe medium of transaction and interaction. The prevalence of smart contracts makes the work quite organized and manageable. All the claims made by the customers are recorded and kept with proof. It doesn't let the customers make duplicate claims regarding the same event. Moreover, a customer's claims get attended to and looked into faster than ever. The money they require is transferred to his account in no time and with utmost security and care.

To make real estate transactions easier

Financial information and ownership in the case of real estate transactions are made more accessible by blockchain technology. Earlier, a lot of paperwork was required, along with other formalities for transferring and verifying ownership. Providing you with a more accessible and secure means of transferring ownership can significantly help you to speed up the transactions and make them hassle-free. Blockchains in these transactions allow for the lessening of paperwork and other formalities.

To make voting hassle-free

Blockchains can be used for voting too. If personal identity information is available on a blockchain, you can easily vote using it. This way, the authority can rest assured that no voter gets to vote twice, and the one vote they give gets counted. It makes things more organised and accessible for the authorities who count the votes.

Conclusion

Blockchain-based contracts are gaining recognition and becoming popular in government, real estate, healthcare, and similar sectors. Keeping organised and trusted records, Blockchains are often considered the most secure and reliable way to store and record information. Prevent duplication and tampering with important information, blockchains have become necessary in almost every sector. One of the most common uses of blockchains is a cryptocurrency exchange.

raja
Updated on 13-Oct-2022 14:08:57

Advertisements