Whenever you hear about blockchain, what comes to your mind?
Crypto right?
It has always been crypto since 2009, when Satoshi Nakamoto created the first cryptocurrency, Bitcoin.
Cryptocurrencies are nothing without blockchain, but is it the same for blockchain?
Can blockchain stand without cryptocurrencies?
Most of us came to know the blockchain because of crypto as we delved into what holds crypto or the working process of Bitcoin.
We can’t talk crypto without mentioning the “Secured ledger” that verifies and records crypto transactions.
That’s the blockchain for you. With blockchain, we run transactions between ourselves, with no third party or intermediary.
Although there have been some misconceptions about the blockchain, as some people feel the blockchain is for crypto alone.
Is that true?
This article will do justice to the above questions. Let’s run along.
Blockchain outside cryptocurrency
Outside the crypto space, blockchain remains a great security algorithm.
Blockchain outside crypto is a distributed ledger that stores different data.
Now it doesn’t store crypto data anymore. It secures the data of other assets like NFTs, supply chain initiatives, metaverse, etc.
Blockchain outside crypto can keep track of the status of shared databases across multiple users.
Remember that transparency, decentralization, and security is the watchword of blockchain.
With this, blockchain is still relevant outside the crypto space.
Do you need cryptocurrency to run a blockchain?
The type of blockchain you run will determine the answer. So, let’s look at the two types of blockchain technology.
Public blockchain
This type of blockchain is permissionless. That means anyone can participate in the network. The crypto blockchain is an example of a public blockchain, where people participate in the blockchain and earn incentives. The people who participate in a public blockchain are called miners. Miners solve complex chain problems while earning rewards.
So, cryptocurrency is needed to run a public blockchain.
Private blockchain
This type of blockchain is centralized, and you need an invitation to participate. Unlike the formal, this blockchain runs through a particular organization.
Hyperledger and Corda are renowned private blockchains. Hyperledger, created by the Linus foundation, uses private blockchains to support confidential commercial transactions.
Corda is another private blockchain used by companies who wish to develop interoperable distributed networks with private transactions.
So, cryptocurrency is not needed to run a private blockchain.
What sustains the blockchain?
The sustainability of a blockchain depends on the blockchain type.
A permissionless blockchain is secured by the number of people participating in the chain. Since miners are always in the blockchain line, it becomes hard to hack a currency on the network.
Since blockchain is open source, hackers can’t gain control over all nodes (computer network).
Also, a private network is secured since it is centralized. But we can’t speak of transparency since it’s not open source.
My opinion
The crypto space gives meaning to blockchain technology by utilizing the benefits of technology.
Blockchain isn’t what it says it is if it requires permission.
A permissionless blockchain is also more secured and decentralized.
The number of people participating in the bitcoin network makes Bitcoin safe and secure.
Bitcoin being permissionless has revolutionalized the finance systems of the world by removing third parties in transactions.