Hi,
I am Crypto Coins and I make videos.
Today I am looking at blockchain as a technology
What is a database?
Database is a collection of information that is organized so that it can be easily accessed, managed and updated. Data gets updated, expanded and deleted as new information is added. The applications are using databases to get information.
There are several different types of databases but the main ones are:
a) Relational databases are made up of a set of tables with data that fits into a predefined category. Each table has at least one data category in a column, and each row has a certain data entry.
b) A cloud database is a database that has been optimized or built for a virtualized environment, either in a hybrid cloud, public cloud or private cloud.
c) A distributed database is a database in which portions of the database are stored in multiple physical locations, and in which processing is dispersed or replicated among different points in a network.
d) There are also other less known types available.
What is blockchain?
It's a shared ledger for recording the history of transactions - that cannot be altered. While complex in nature the actual idea behind blockchain is quite simple:
a) As each transaction occurs it's put into a block
b) Each block is connected to the one before and after it
c) Transactions are blocked together.
d) Each block is added to the next in an irreversible chain.
Blockchains are commonly operated through thousands of global computers in an open peer-to-peer network meaning the data isn't stored in a single location or across a single server
They can be public or private depending on the use-cases
Distributed database?
Blockchain has some similarities to distributed database since the data is kept on several machines. There are also differences though.
In a databse users trust all the machines (since they are all in admin control) so the machines are not expected to compromise the integrity of data.
On the blockchain, users don't trust any of the machines but expect that over 51% of the computers connected to the network are honest
Blockchains in general can also be considered more limited than distributed databases but they also have advantages so it's basically a case of seleting the better tool.
Advantages and disadvantages
2 main advantages
Robustness: blockchains are usually tamper-proof. Once recorded the transactions cannot be altered.
Decentralisation: Require no central administrator since blockchain transactions contain their own proof of validity and their own proof of authorization
2 main disadvantages
Confidentiality: every node in a blockchain independently verifies and processes every transaction, there are some solutions to change it like advanced cryptographic techniques but those are exceptions and not a rule
Blockchains will always be slower than centralized databases simply due to how they work.
Blockchain Usage
Bitcoin is the original and the most popular use case for blockchain - it is esentailly used to record transactions on the blockchain. Basically Internet money.
Introduction of smart contracts changed blockchain use cases. Smart contract is a computer program that directly controls the transfer of digital currencies or assets between parties under certain conditions. This means that wile Bitcoin is a simple transfer of value with contracts you can do that transfer only if certain conditions are filled.
Ethereum made smart contracts popular and opened a whole new different world for blockchain. Currently they are mostly used for crowdfunding but in the future there should be several great use cases that could revolutionise we use computers and electronic devices.
The Future
I see blockchain being used as an alternative to databases. While it wouldn't say it's better than databases in general it does have advantages under certain conditions so there might be companies picking it over
Cryptocurrency is currently the main use case but I see it changing the more companies are trying to find specific use cases for blockchains.
We are already seeing plenty of interesting ICOs popping out with use cases very unique and exclusive for blockchains. Those projects and the crypocurrencies supporing it should do well so its a good idea to invest into projects like these. Be aware of forced use cases though.
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nice post
Hi! I am a robot. I just upvoted you! I found similar content that readers might be interested in:
https://www.youtube.com/watch?v=JtsDO_haQgoYou raise a very important point here, blockchain is not supposed to be a replacement for database. Both are different technologies and are more adequate for different use cases.
People on the Crypto world have the tendency to see it as the revolution that will replace all other technologies. In my opinion, these people still don't understand what blockchain is.
Agreed. Many people don't understand it and are just pumped around the hype bitcoin has got.