If you are interested in investing or have been involved with cryptocurrencies for a longer time, you must have heard of blockchain technology. These inventions are directly linked together and they affect each other.
Therefore it’s imporant to learn about blockchains if you are interested in cryptocurrencies. This short guide will help you to understand them better. That way understanding cryptocurrencies will also become easier.
Learn about blockchains to understand cryptocurrencies better
The more you know about blockchain technology, the easier cryptocurrencies, and their market is to understand. If you want to learn more about blockchain technology you can use a source like a blockchain ebook to get a more in-depth look into the subject.
Before starting to study more about them, you need to obviously know the basics. Surprisingly many people who have invested in cryptocurrencies don’t even really know what they are. So what does blockchain even mean?
As its name suggests, a blockchain is a chain formed by separate blocks. All of the blocks contain data. This data can be any information, such as cryptocurrency transactions. Blockchain technology is a safe and secure way to store and transport information. This is why it is used with cryptocurrencies.
Blockchains were invented decades ago
Many people think that blockchain technology was invented for the very first cryptocurrency, Bitcoin. This is quite opposite of the truth. The very first version of blockchain technology was invented already in 1982. This was done by a cryptographer called David Chaum.
The purpose of blockchain technology was to store and transport information online in a safe and encrypted way. By doing so, any type of information could be saved from being tampered with. This makes blockchain technology very usable in the contemporary world, where information getting tampered with is basically always a risk.
Cryptocurrencies were the first practical use for blockchains
Clearly, blockchain technology has always been a very usable innovation. Still, it took many years for it to get its first purpose. This came through the introduction of cryptocurrencies and Bitcoin.
Bitcoin is the very first cryptocurrency. It still isn’t the first one that tried to become reality. All other cryptocurrencies before faced the same problem. Since cryptocurrencies are not connected to any country and are decentralized, they could easily be tampered with. This is the problem that blockchain technology fixed. With its help, cryptocurrencies could be launched and it’s almost impossible that people could tamper with them or launder money.
Read also: Is Crypto Part of Fintech?
Now blockchains are getting increasingly important
Even though cryptocurrencies made blockchains famous, now technology is used in many more ways. As we said, the information and data can be pretty much anything and it will always be kept safe. This is why people are coming up with more and more ways to use it.
Some great examples of this are creating smart contracts and storing medical records. Additionally, now some countries are even looking into introducing blockchains into their voting system. This is only beginning, and most likely in the future blockchains will become an even bigger part of our world.
