Published on September 13th, 2019 📆 | 4496 Views ⚑0
What’s so Important About Distributed Ledger Technology?
Distributed Ledger Technology (DLT) has become a central means by which we store and update public records. An active DLT system is ideal because of its transparency. What bitcoin, for example, has achieved as a decentralized currency is replicated within bookkeeping. This form of accounting is now digital; it operates without a central authority.
DLT Nodes: Accountable, Accessible and Impenetrable
From the achievements of the distributed ledger, we also get the trademark idea of blockchain. Blockchain gets its name from a process of record keeping that’s achieved by various types of DLT systems. It starts with data being updated into “blocks of code.” Public nodes, which are the individual stations of a DLT network, receive data in an attempt to come to a consensus on it. A consensus is made when multiple nodes agree on the info that they receive.
Each agreement is how we collect data and then uphold it without any single authority in control of it. The next stage, which completes each “block” of information, is the encoding of the data that was “chained” from a prior transaction. Not all DLT networks need to be encoded, however, encryption protects data from being infiltrated. As in the world of finance, encoding keeps data from being altered once it has been received and agreed on.
What is Cryptography & How Does it Work?
Competing armies made cryptography popular during World War II, but no one knows when militaries began to use it. Cryptography works through a system of communication that presents a common language through substituted symbols or characters. Only if you have a decoder can you decipher messages written in cryptography. In warfare, the one sending a message would first give the one receiving it a decoder.
Modern cryptography uses a random generation of characters to encode each block of information that’s accepted by DLT nodes. This type of cryptography ensures that only the parties involved in a transaction have access to the information held within each block. This excludes the node operators. Cryptography makes distributed ledger technology relevant. As the source code for bitcoin proves, a DLT network can operate without interference. Its blocks of data only need to be protected from infiltration. DLTs will become common in many industries in the near future.
Originally published at robertsiekert.comon September 5, 2019.