The world is spending billions of dollars on blockchain technology every year, which means the current number of blockchain wallets (around 70 million) is only likely to surge as time goes on.

But although the tech that powers Bitcoin mining and the cryptocurrency market is one of the hottest topics around, it’s still a total mystery to many of us. How does this backbone of the crypto market work? What are its advantages and disadvantages? And why are some transactions quicker than others?

Well, let’s see if we can’t solve that mystery. Read on to learn all there is to know about the intricacies of blockchain technology!

So, What Is Blockchain Technology?

If you’ve ever asked someone about blockchain (or Googled it), you probably came across the phrase ‘distributed ledger’. Well, that’s all well and good, but what does distributed ledger actually mean?

Okay, so, think of a ledger recording a load of possessions and transactions. Person A owns Item B. Person C bought Item D, and so on. What is the main flaw of that tech?

It can be altered by anyone. If Person C wanted to own Item B, they only need to come along with a pen and alter the ledger to change the ownership record. If you can’t trust the owner of the ledger to keep accurate records, the whole thing becomes useless (and even if you do trust them, everyone makes mistakes).

But what if the ledger existed thousands or millions of times, distributed across a wide variety of places and was protected against fraudulent additions by advanced cryptographic techniques? Suddenly, you don’t need to trust anyone, the ledger is inherently secured by its decentralized nature and the cryptography that’s gone into making it.

That’s the blockchain.

Blockchain’s Pros and Cons

That’s why people entrust the blockchain to accurately record their ownership of millions of dollars worth of assets to the blockchain. But the technology has its advantages and disadvantages.

The advantages are clear: security, transparency, and no need to put your trust in a central authority or an individual. It’s not even hard to withdraw your earnings: you can get them out of an ATM-like BTC machine. That’s all great, but what are the downsides?

Well, the main one is that transactions can sometimes take longer than you’d like. It can sometimes take a bit of time for a transaction (Eg. sending a bitcoin to someone else) to verify and complete on the blockchain. That can be an issue if you need to make a swift transaction.

On the whole, though, blockchain’s pros outweigh its cons.

The Technology of the Future, Today

So there you have it, our brief guide to the decidedly not-brief subject of blockchain technology. Whether you’re a die-hard crypto trader or a total Bitcoin newbie, we hope this quick run-through gave you a new understanding of a technology that’s changing our world.

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