Everyone nowadays is aware of the blockchain and the impact it has had on the development of digital currencies, NFTs, and other innovations. Blockchain technology is becoming increasingly popular, with individuals all around the world adopting it.
However, blockchain technology was not as flawless as it is now, but it has evolved over the period of nearly three decades to become what it is today. In this post, we will look at the ins and outs of blockchain and how it has evolved over time.
What is Blockchain?
There is no such thing as a blockchain by itself; rather, it is combined with a variety of different technologies. Blockchain technology may be described, in layman’s words, as a type of decentralised information bank, in which valuable digital assets may be kept on a global scale. To gain access to such information, you are required to possess a cryptographic key that is incorruptible by any means.
Instead of relying on intermediaries, the blockchain is a distributed ledger that depends on people, organisations, and machines located all over the world to verify the information that enters and leaves the network.
Bitcoin (BTC), which employs blockchain technology and does not require any middle parties to transact currency, is a very good example of blockchain technology.
(How Blockchain Technology works. Source: Medium)
The use of blockchain with trust is straightforward in the present day, but in the past, it was challenging to develop such a flawless system. Nevertheless, the blockchain managed to defy all odds and evolve into what it is now.
The History of Blockchain
The Beginning
Despite the fact that concepts similar to the blockchain were discussed far before the 1990s, the first time a blockchain was really implemented was in 1991. The effort was carried out by a few researchers who were tasked with developing an innovative strategy for the preservation of digital information backups.
Later on, they made the decision to write and publish a letter in which they discussed what they had developed and how it had the ability to safely save knowledge from the past.
Even though a novel strategy known as Merkel Trees was proposed in 1992 with the intention of making the blockchain system more efficient, the 1990s weren’t a very productive decade for blockchain development. In later years, the well-known method known as Proof of Work (PoW) was developed as a means of defending it from cyber assaults.
In 2004, a now-famous computer scientist by the name of Hal Finney invented a new mechanism for the blockchain that was later given the name Reusable Proof of Work (RPoW). The blockchain technology was only able to go further as a result of this.
In 2008, an anonymous user who was known only as “Satoshi Nakamoto” sent a message that would transform the world forever. Based on the previous version, he developed a new one for the blockchain technology that makes use of hardware functionalities. This led to the introduction of an entirely new system for the blockchain technology.
This letter not only ushered in a new era for blockchain technology, but it also gave birth to a novel idea known as mining, in which anonymous systems may verify information in a far more accurate manner.
The New Era
Following the publication of this letter in 2009, the groundwork for Bitcoin (BTC) was laid. People that mine Bitcoins are guaranteed to get incentives as a result of the mining process, and Satoshi Nakamoto mined the very first block that was ever mined in the history of the cryptocurrency.
After some time, Bitcoin transactions began taking place, and not long after that, the very first Bitcoin exchange was launched, making it possible for anybody to purchase and sell Bitcoin (BTC). The value of one bitcoin (BTC) continued to rise steadily over the course of several years.
Even though it is possible that we will never learn who Satoshi Nakamoto is, he has made a significant contribution to the advancement of technology by imparting his expertise to new developers all over the world who are willing to adapt to changing circumstances and make the technology even more useful.
The Rise of Blockchain
The year 2013 was the year when Bitcoin grabbed the globe by storm, increasing to a very high value and sparking even greater interest in the blockchain technology that underpins the digital currency. Even the $1,000 barrier was overcome, and new developers all around the world began to recognize the incredible potential it possessed.
Later on, Vitalik Buterin, one of the co-founders of Ethereum, began working on an entirely new concept that would later become known as Dapps, which is an abbreviation for decentralized applications.
Heo he started working on developing Ethereum, a new distributed computing platform that is built on blockchain technology.
2014 was the year that saw the completion of the founding of Ethereum, which was not just a digital currency but also much more than that. A year and a half later, in 2015, a whole new concept known as Smart Contracts was presented, which quickly became one of the most prominent implementations of Blockchain technology.
Smart contracts carry out their own execution entirely on their own and do so when the criteria of a predetermined condition are satisfied.
The blockchain technology gained even more acceptance from people all around the world in 2016, and it started making its way into the mainstream during that year. At around the same time, the price of Bitcoin started climbing to new heights as a result of an increase in the number of people buying it.
In 2017, Japan approved Bitcoin for use as a currency, and in the same year, US legislation acknowledged Bitcoin as a legitimate form of financial investment. During this time period, the price of bitcoin surpassed previously established boundaries.
During this time period, financial institutions began to focus more closely on technology and the opportunities it presented.
Anyone who opted to invest in Bitcoin the next year endured a terrible year as the price of the digital currency dropped to approximately $2,000 over the course of the year. Additionally, advertisements for cryptocurrencies are not allowed to be used on social media platforms.
The cryptocurrency market as a whole, including Bitcoin and all other cryptocurrencies, suffered significant damage this year.
Blockchain’s Global Potential
The year 2019 saw an increase in popularity of cryptocurrency investments of all kinds, particularly Bitcoin (BTC). After some time had passed, several social media networks began to see the potential that blockchain technology possessed.
China was one of the first countries to recognize bitcoin as a legitimate form of currency, and other nations soon followed suit. Facebook, one of the most widely used social media platforms, just unveiled its very own cryptocurrency, which they called Libra.
As a result of people being forced to remain inside their houses because of the Covid epidemic in the year 2020, blockchain gained even greater popularity. The price of bitcoin reached unprecedented heights and entirely shattered other limits that it had previously established.
In addition, Ethereum disclosed its intentions to begin developing Ethereum 2.0, a solution that not only addressed their gas issues but was also friendlier to the natural environment.
The year 2021 was a rather peculiar year for blockchain, since Bitcoin’s price hit an all-time high during that year but then immediately began to fall again. The usage of bitcoin as a genuine form of currency was also made legal in El Salvador, which is a very tiny country.
In addition, following a series of tweets, Elon Musk, the CEO of Tesla, revealed his intentions to use Bitcoin as a cryptocurrency to purchase Tesla automobiles. However, he then revoked the announcement, claiming that doing so would be highly detrimental to the environment.
During this time period, a new wave of NFTs began to take effect, and the concept of Web3 was being discussed. This resulted in the launch of new businesses and initiatives, many of which went on to achieve great success and contributed significantly to the advancement of blockchain technology.
Because NFTs and the Metaverse have become an even more popular concept in recent months, this continuing year has also been a little thrilling for blockchain. Massive companies such as Adidas and Ferrari, amongst others, were in attendance to display and sell their NFTs.
During the conflict that is still going on between Russia and Ukraine, Bitcoin (BTC) has also become a useful tool to donate money to the people of Ukraine.
The Future of Blockchain
The future of blockchain technology is not entirely clear. There are now too many new developments and ongoing events to accurately predict where this will end up.
The fact that blockchain technology has already achieved a great number of things and has been operational for such a long time is sufficient evidence to demonstrate that it possesses a significant amount of untapped potential. Only time will tell what the future holds for blockchain technology.
Takeaways
- Everyone nowadays is aware of the blockchain and the impact it has had on the development of digital currencies, NFTs, and other innovations.
- There is no such thing as a blockchain by itself; rather, it is combined with a variety of different technologies.
- The use of blockchain with trust is straightforward in the present day, but in the past, it was challenging to develop such a flawless system.
- Despite the fact that concepts similar to the blockchain were discussed far before the 1990s, the first time a blockchain was really implemented was in 1991.
- In 2008, an anonymous user who was known only as “Satoshi Nakamoto” sent a message that would transform the world forever.
- The blockchain technology gained even more acceptance from people all around the world in 2016, and it started making its way into the mainstream during that year.
- The year 2019 saw an increase in the popularity of cryptocurrency investments of all kinds, particularly Bitcoin (BTC).
- Only time will tell what the future holds for blockchain technology.
