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Know The Back End System of Crypto
As you know “Digital currency Cryptocurrency, like Bitcoin, is backed by a key backdoor, “Blockchain,” which is known for its transparency. Privacy and Trust But in addition, there are other technologies that help support digital currencies. Cryptocurrency can be operated the way it is today, what is it?
1. Let’s start with the protagonist like “Blockchain Technology”.
Blockchain Technology is a distributed ledger technology and no middleware. (Third-party) data recorded in the Blockchain system can be difficult to modify because the data is saved in blocks and connected by cryptography. It is very difficult to change the whole block chain. When Blockchain Technology is implemented, no one or any organization has absolute power in the system. No one can distort or modify information.
Highlights of Blockchain Technology:
- Reduce the cost of intermediaries (Third-party)
- All transactions are safe. Private and efficient
- Increased transparency because when data is added to the system Everyone will see and be aware of that information together.
2. Decentralized System
A decentralized system is a system that does not need to rely on or trust anyone in the system. Everyone has a copy of the transaction data in the Blockchain system. When someone manipulates or alters the data. that will not be accepted by the masses Because everyone has the same set of information.
Things you should know
Decentralization in Blockchain refers to the transfer of decision-making power and control from a central location to a distributed network . (Decentralization) reduces the weakness of the system because it does not depend on one member. This will reduce system errors.
3. Smart Contract
Smart Contracts are programs that are automatically executed between buyers and sellers where code and agreements are placed on the Blockchain network . A digital process that pre-defines the transaction process. without intermediary
Smart Contract 3-step process (in a nutshell)
- Draft contract terms and turn them into code or language that computers can understand. For example, draft a money transfer contract. Draft data access contracts, etc.
- When there is a trigger event or something that meets a certain condition. The system will automatically fulfill the conditions.
- Grant access to products/services Or the contracts that are put in the Smart Contract go well.
4. Cryptography
Cryptography refers to the mathematical and computational processes of cryptography and decryption. It is capable of exchanging information only to those who have permission and permission to read it. “The Science of Hiding Information”
Cryptography is used for a variety of purposes, such as enhancing the security of transactions on the network. Used to verify transactions of digital assets and tokens. The sender encrypts/hides the data using a unique key and algorithm. The recipient will decrypt and convert the message back.
5. Asymmetric Encryption
Asymmetric Encryption means encryption using two types of keys: Private Key (encryption) and Public Key (decryption). Anyone can access the Public Key and encrypt data. But once the data is encrypted The decryption requires a private key only, and both types of keys are pairs. Also known as Key Pair.
