If nature decentralized is the spotlight of cryptocurrency, Blockchain technology is the core of the problem.
Blockchain, also known as block-chain technology, works by converting transactions on the system into "blocks" and are validated by a system before the transaction is completed.
Thus, when you make a transaction, the whole system will recognize and confirm the transaction, not an individual or organization.
Another outstanding feature of Blockchain is that transactions cannot be counterfeited, replaced, or deleted. Transactions on the Blockchain system are confirmed by blocks and the blocks are closely linked to each other. If you change or delete any block, the action must receive system approval before being performed.
So, what benefits will those who play the role of verifying transactions receive?
If banks or financial services will collect transaction fees and management fees to perform transaction verification work; Transactions in the Blockchain system will be verified by the network. The network is a collection of many network nodes (nodes), each node is a computer controlled by miners.
The essence of transaction verification is to solve complex encryption algorithms in the system we often call "coin mining". For each confirmed transaction, miners will receive a portion of the profit called "coin mining". “block reward”.
The division of block rewards depends on the mechanism of each Blockchain network (or each coin). Normally, block rewards will be divided according to consensus rules such as Proof of Work (PoW), Proof of Stake (PoS), ...
Some outstanding applications of Blockchain technology:
- Trace the origin of food, foodstuffs and goods
- Manage systems and supply chains in fields such as healthcare, education, agriculture,...
- Smart contracts
- Claiming (NFT)