The consensus algorithm is what makes blockchain technologies highly effective. It is an integral feature of every blockchain and indeed is a defining characteristic. To put it simply, consensus is a decision-making process for the group of nodes active on the network. Here, the nodes can come to an agreement quickly and relatively faster.
When millions of nodes are validating a transaction, a consensus is absolutely necessary for a system to run smoothly. You could think of it as kind of a voting system, where the majority wins, and the minority has to support it. Truth be told, consensus is what makes the system trustless. The nodes might not trust each other, but they can trust the algorithms that run at the core of it. That’s why every decision on the network is a winning scenario for the blockchain.
Irreversibility of Hashing
Hashing is a complex mechanism, and it’s impossible to alter or reverse. Which means that no one can use the public key to reverse-engineer the private key. Also, a single change in the input could lead to a completely different key output, so minute changes will also be detected.
In order to corrupt the network the hacker would have to alter at least 51% of the databases present on the nodes in the network. There could be millions and millions of people, where everyone has the same copy of the ledger. Accessing and hacking millions of computers is next to impossible and costly.
That’s why it’s one of the best blockchain features. As it’s too hard to bypass, you won’t have to worry about hackers taking all your digital assets from you.
7. Distributed Ledger
Public ledgers provide information about transactions and include participants to the public. There is lack of security or authority in such ledgers which is not the case for private or federated ledgers that can also be integrated into a blockchain system. That’s because the ledger on the network is maintained by all other users on the system. This distributed computational power across the computers to ensure a better outcome.
The distributed ledger allows anyone with the required access to view the ledger and makes the process transparent and reliable.
Importance of DLTs :
a. Tamper-Resistant : Distributed ledgers are designed such that no one can change the ledger and all updates take place almost simultaneously.
b. Ownership of Verification: Nodes of the network act as verifiers of the ledger. If a user wants to add a new block others would have to verify the transaction and then give the green signal.
c. No bias: No one on the network can get any special favours or experience bias of any kind from the network nodes. Everyone has to go through the same procedure to add blocks.
d. Managership: To make the blockchain features work, every active node has to maintain the ledger and participate for validation.
e. Quick Response: The lack of intermediates hastens the system response. Any change in the ledger is updated in minutes or even seconds!
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