Does blockchain provide a better system for transactions than our traditional method?

How does blockchain transaction really work?

Blockchain forms an important part of the whole cryptocurrency puzzle even though it was based on a couple of technologies that were already introduced in the late 1980s and 90s like Cryptography and digital ledger posting to merge into one cohesive system. Blockchain has endless possibilities of application which is fair to see the claims that everything will one day be tokenized and become a part of a huge global network of blockchains.

Source: https://www.corcentric.com/blog/introduction-to-blockchain-technology/
  1. First, a transaction is requested between the sender and receiver via their respective wallet addresses, this process will use a system of Public Key Cryptography in which the receiver will send his public key to be filled in the Recipient Address and the sender will sign/stamp the transaction using his private key.
  2. Once the transaction is sent to the network, it will be grouped with other transactions into a block, ready to be picked up by any miners/validators to verify and confirm the transactions.
  3. This block is then shared with the whole network to be verified by active miners/validators to verify the transactions. Every computer in the network checks the transaction against some validation rules that are set by the creators of the specific blockchain network.
  4. Miners/Validators will also complete a series of cryptographic puzzles to generate a hash and nonce that will both seal the block and encrypt the data inside.
  5. These hashes are then used to register and add the new block to the blockchain.
  6. Once the block is added, your transaction is confirmed and completed in the blockchain and now the transaction is part of the blockchain which then cannot be altered in any way.

Is it a necessary upgrade to our traditional system?

Blockchain has a lot of potential in the future as a form of evolution to our current transaction system but to achieve that it needs to provide a significant benefit that is not present in our traditional system. Blockchain is quite an evolution to our digital payment system as it provides a decentralized platform for verification but it might not be an easy way for transactions for our early generation who are used to the physical transaction system.

Source: https://unida.ac.id/teknologi/artikel/pengertiaan-dan-manfaat-dari-blockchain.html

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Nagaya Technologies

Nagaya Technologies

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NAGAYA (NGY) is a Gold-Backed Cryptocurrency with Subsidiary Projects. We aim to build Trust and Value through LEGALITY and TRANSPARENCY. https://nagaya.co/