These words are everywhere. There are news stories and studies and use cases. But what does blockchain technology really mean for your business?
Blockchain is far from a fad or a trend. It’s changing the way we do business. It’s giving owners and executives transparency, streamlining processes and creating efficiencies. It’s technology disruption that’s impacting your bottom line.
What are blockchain, cryptocurrency and bitcoin?
Blockchain is a chain of digital pieces of information, stored in a distributed ledger in which each block of data is added to the chain via an append-only process. Blocks contain individual pieces of digital information that distinguish it from the other blocks, and among these is a cryptographic hash, which allows someone to verify that authenticity of that data.
Blockchain is a type of distributed ledger technology, meaning the database or ledger is shared and synchronized across multiple locations and people, but not every distributed ledger is a blockchain. If the blockchain is public and permissionless then this allows for decentralization and eliminates the need for a central authority. Blockchain can be used for digital assets (like cryptocurrency), as well as business process management.
Cryptocurrency is a digital or virtual medium of exchange that exists online. “Crypto” refers to the different cryptographic techniques employed in the decentralized payment system to prevent counterfeiting and fraudulent transactions (double-spending).
Cryptocurrency, if decentralized, is not issued by a central authority (like a bank) and therefore not susceptible to regulation. Cryptocurrency utilizes blockchain and distributed ledger technology, although if a cryptocurrency is not properly decentralized then it may be viewed as a security.
Bitcoin is considered the first decentralized cryptocurrency. Unlike traditional currencies, bitcoin has no physical form. Rather, bitcoin is produced virtually through “mining,” where miners are repeatedly solving a block hashing, proof of work, function to add a new block of transactions to the blockchain. The miners that are successful receive a block reward, represented by newly issued bitcoin in a coinbase transaction, for their work.
Learn more about the opportunities that exist for blockchain technology and business.
Why is blockchain important? Eide Bailly is dedicated to finding that answer and keeping you up-to-date on the business case for blockchain.
Eide Bailly is proud to be part of the following blockchain groups