What is Blockchain
Blockchain technology is an innovation that arose out of the ashes o f the 2007-2009 financial crisis. The collapse of Lehman Brothers turned a strictly financial crisis into a trust crisis.
Blockchain technology uses a transparent distributed ledger that displays all transactions in the system to anyone with viewing access. You can actually monitor the distributed ledger live at https://blockchain.info.
This distributed ledger is a list of all transactions currently being processed. Each transaction is encrypted and fully anonymous. When a transaction, between Party A and Party B, is entered into the system, it must be validated. Those who conduct the validation are called miners. They are paid in virtual currency for their efforts to validate transactions. The validation process involves verifying that the party whose encrypted ID number initiated a payment actually has enough funds in their account to make the payment.
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Once this is verified, the transaction becomes a “block”. It becomes linked to all other previously verified blocks to create a publicly viewable audit trail called a blockchain. All entries in the blockchain are anonymous because they are encrypted. However, the history of transactions for
a specified encrypted account is publicly available. This process effectively replaces the traditional middle man, a commercial bank, with a nontraditional middle man, the miners, who validate the authenticity of transactions.
The NASDAQ stock exchange has launched the first ever stock exchange built on a blockchain platform. It is called “Linq” and began accepting trades in late 2015. It enables anonymous equity transactions verified in encrypted blockchain format.
