The world of cryptocurrencies can be polarising and downright confusing. Our investment team has broken down the underlying technology behind the coins to help you make sense of the crypto craze. (Reading time 3:43 mins)

This information does not take into account your personal objectives, financial situation or needs. You should consider if the relevant investment is appropriate having regard to your own objectives, financial situation and needs.

 

Blockchain rose to prominence in recent years as the underlying technology powering Bitcoin and other cryptocurrencies. However, it has many more applications that extend beyond internet money. Blockchain allows information to be digitally distributed but not copied, effectively creating the backbone of what some believe is the greatest technological advancement since the Internet.

But what exactly is Blockchain? Who created it? And what can it be used for outside of the cryptocurrency space?

 

What is blockchain?

Blockchain is a continuously growing list of records, called blocks. These blocks are linked and secured using a process called cryptography. Each block contains three things – a timestamp, transaction data and a link to the previous block.

Blockchain is an open source, publicly available distributed ledger typically managed by a peer-to-peer network (as opposed to a centralised operator such as a bank). It collectively adheres to a protocol for validating new blocks. Once recorded, the data in any given block is immutable, and therefore cannot be altered without alteration of all subsequent blocks – which requires collusion of the network majority.

To use a more familiar reference point, visualise an excel spreadsheet that is duplicated and distributed across a network of computers. Imagine that this network of computers is designed to regularly update this excel spreadsheet, and you’ll have a basic understanding of blockchain.

This way of using the network is hugely beneficial – the database is not stored in any single location meaning that records are kept public/easily verifiable; and as no centralised version of the information exists, it’s unable to be hacked given it’s hosted by millions of computers simultaneously.

 

Learn more about how Blockchain is transforming more than just cryptocurrencies. 

Become an AtlasTrend member to access the full article and more investing insights. AtlasTrend makes it easy to invest in global shares built on world trends. Join AtlasTrend today. Sign up for a free 30 day trial. Cancel anytime. 

Sign up to AtlasTrend for Free

 

About Kevin Hua

Kevin Hua is a Co-Founder of AtlasTrend, an online investment platform that makes it easy for anyone to learn and invest in trends transforming our world. Kevin has over 20 years experience in financial markets including as Senior Portfolio Manager at Atrium Investment Management and Stark Investments.