Blockchain is a new technology that is used for many purposes and tasks. You have probably known about Bitcoin, crypto, and NFTs because these are trending topics. Now, those things are created in blockchain technology. But many people don’t know about this. But if you want to know, then make sure you know these terms:
A distributed ledger in the blockchain is a database that is shared with multiple users in the Blockchain network. Now, all the users will have an identical and synchronized copy of the database where they can execute, verify, and record their transactions by mining without the need of any third party or middlemen like banks, brokers, etc. The distributed ledger technology represents the peer-to-peer transactions that are highly secure, and no other parties will be able to control your transactions.
Smart contracts are programs that are run when some sets of predetermined conditions are met in the blockchain. Now, smart contracts are for the automation of the execution of the transactions in the blockchain so that all parties can be certain about the transactions made in the blockchain. Since the outcome is informed right away in the blockchain, so no time will be wasted, and there will be no need for any intermediaries at all. It is also used for satisfactory transactions. That is because all the users have to be agreed on how the data will be presented on the blockchain, and all have to be satisfied with that.
51 Percent Attack
Don’t think about the attack like some hackers are going to hack the blockchain system. The 51 percent attack means the node or the group that will possess more than 50% of the coins in the blockchain will dominate the Blockchain. That is because the node of the group that has the most contains has a good influence on the voting of the blockchain. So, if you are the holder of the maximum coin in the blockchain, then you will be able to make influential decisions and control the blockchain network. And that makes the Blockchain very vulnerable. So, to solve this problem, blockchain uses a method which is the privatization of blocks. I mean, if you are the holder of more than 50% of the coin in the blockchain, then your block will no longer be a public ledger; instead, it will be a private block.
Coins and Tokens
It is mandatory to have an asset so that a network can keep going and users may increase on the network. However, in a Blockchain network, users will be engaged and work so that network can grow, and that’s why the need will need incentives. Now, coins and tokens act as incentives for the network. These are the rewards that users get for their validations. Coins and tokens are different, though. Coins have their own blockchain platforms and mechanism, for example, Bitcoin, Ethereum, etc. On the other hand, tokens are created on other Blockchain platforms, for example, NFTs.