Blockchain is basically a digital ledger of transactions that are duplicated and shared among several computers that may be found anywhere in the world and can be accessed by anybody with an internet connection, in such a way that it is impossible or hard to hack or change its system.
Distributed Ledger Technology (DLT) is a decentralized database that is operated by various participants. Through this, a single block will be totally obvious that the chain has been tampered with once it has been already modified.
Advantages of Blockchain:
- Security – every individual who uses the Blockchain network is given a unique identity that is linked to his/her account.
- Decentralization – since blockchain doesn’t save any of its data in a central location, it is duplicated and distributed over a network of computers instead.
- Fast processing – prior to the introduction of blockchain, the complete banking process would take three days to settle, but following its implementation, the time was reduced to minutes or even seconds.
Disadvantages of Blockchain:
- Regulation – since everyone is aware that money is generated and controlled by the government, Bitcoin’s acceptance by existing financial institutions becomes a challenge.
- Complexity – blockchain has made cryptography more accessible to the general public, yet the highly specialized sector is filled with jargon, making it difficult for non-techies and older generations to understand the technology.
- Network size – since blockchain is not a strong network with such a widely circulated grid of nodes and demands a wide network of users, getting the full benefit becomes more challenging.