With the rise of cryptocurrencies such as Bitcoin and Ethereum, the blockchain technology behind them have gained a lot of momentum. For those unaware, the blockchain, also known as the “distributed ledger” technology is the platform where users can record transactions or other digital transactions safely and transparently by design. The database is capable of maintaining a growing set of data records, and one of the biggest advantages of the blockchain is that it is public meaning the all the transactions are available for others to see. This technology has been one of the most fascinating technological advancements, but with that comes many misconceptions about it. Here are some of the common myths about blockchain technology.
Blockchain Is Bitcoin
This is very common amongst those who are primarily familiar with Bitcoin. With Bitcoin’s meteoric rise to prominence, people are quick to assume that Bitcoin and blockchain are one in the same. As mentioned earlier, the blockchain is the underlying technology that Bitcoin transactions take place. The blockchain is what allows for the peer-to-peer transactions to be recorded on the distributed ledger across its network. Bitcoin, on the other hand, is the cryptocurrency itself that makes it possible to have electronic payments between two parties without going through a third party.
Blockchain Technology Can Be Used For Everything
While the code behind the blockchain technology is compelling, it is not magic and cannot be used for everything. Many experts of the technology believe that blockchain along with smart contracts (the contracts executed using blockchain) will be able to replace money, lawyers, and other arbitration bodies. However, the code is insufficient due to the number of cryptocurrency transactions within the system. Plus, outside of Bitcoin, cryptocurrency is a long way from breaking through as a mainstream payment option.
Blockchain Records Can Not Be Hacked
One of the key features of the blockchain is its security and transparency. Unfortunately, due to this, most users believe that it is immune from hacking and other types of cyber threats/attacks. Like all other forms of technology, the blockchain is not invincible, but it is capable of providing applications developed within the system as a means to catch unauthorized changes to any records. Normally, the larger and distributed a particular network is, the more secure it seems to be.