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Bitcoin & Blockchain: Similar or Different?

Disclaimer: This is a guest post by Rosie Wilson

The popularity of bitcoin and blockchain technology has increased in the recent few years. Whenever you are on the Internet, you are likely to see a blog or website which talks about blockchain and bitcoin. Investors are not behind either. Well established businesses, startups as well as individuals are investing in these technologies.

It is also a great opportunity for someone who is unemployed and wants to invest in bitcoin. Let’s assume you are unemployed or don’t have a regular source of income. In this situation, you can invest your savings and for your daily expenditure, you can take loans for unemployed from any direct lender. Investment in bitcoin is also a way to generate income for you.

It would be an injustice to just get used to seeing the two terms but not really understand the concept and relation between them. Here, we explain to you all you need to understand regarding bitcoin and blockchain.

Bitcoin Unriddled

Bitcoin is a form of digital currency which is being bought and sold in many parts of the world over the web. Cryptocurrency is the other term we use to refer it. It has been on boom in recent years. You can use bitcoin outside the conventional banking system, which needs that the fund goes through the bank. After you send bitcoin to someone, the transaction gets broadcasted to a grid of computers working round the clock. The transaction is then checked and confirmed almost spontaneously.

All the information regarding your transaction along with others involving bitcoin is recorded and stored in a public registry. The public registry is visible to on all computers that are part of the network. All of these computers work for the same goal, validation of every transaction involving bitcoin. Since it is not present physically, it is very safe and secure to transact through it. However, there were few hacking issues in recent times. But its developer is making all efforts to make it full proof and secure from any outside effort.

Blockchain Elucidated

As we discussed above, bitcoin transactions are recorded and stored in a public registry. Each transaction is recorded as a block. A sequence of transaction forms the blockchain. However, the word blockchain is itself used to refer to the technology. So we can say that while blockchain is the sequence of bitcoin transactions on a public registry and it is the technology being used to record the transaction. This technology is also called simply Blockchain. It is open and secure and can be accessed easily by all.

The Correlation between Bitcoin and Blockchain

The bitcoin is a digital currency whereas blockchain is the technology on which bitcoin is built. Hence, we can say bitcoin is dependent on blockchain. Without blockchain, there is no significance of bitcoin because there would be no safe way to transact it. Blockchain provides a sustainable database which ensures that all claimed transfers are actually transferred. As a result, you are guarded against dual spending and fraud.

Importance of Relationship between Bitcoin and Blockchain

The relationship between bitcoin and blockchain is of great importance. By blockchain, the computer network recording and confirming a transaction must concur that the transaction is not invalid before a new block gets added to the queue. This brings a level of security and protection that has not been seen before. Not even a single computer can change the memory of the chain. The trust which is generally given to financial institutions like banks to keep correct and accurate record will eventually get replaced by a consensus-based model.

It is argued that though the current landscape of blockchain has been restricted to its relevance in the financial sector, in future it will be used in record keeping, property related things, managing contracts, and shipping information. This is the reason many have termed blockchain as a disruptive technology.

Description: The Bitcoin and blockchain will become a calamity for the economy or it will augur in the betterment of it, is still a matter under discussion by many. Initial disruptions are bound to happen due to the inventing of new technology.

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