Today, so many people are unable to stand the banks, but do you know why? Is it the maintenance fees, hidden charges, slow processing time, or insecurity? The answer is all of them!
Banks lack transparency and secrecy, and it is a big issue, but you now have a way out-blockchain and cryptocurrencies. They make it possible to say goodbye to loss of money and challenges of working with traditional banks.
Transparency is critical in finance, and blockchain has the best answer so far. Despite this fact and the large crypto market surpassing 1.4 trillion USD, a lot of people have no idea how it operates. To help you understand blockchain and its importance, as well as why you should also buy some crypto coins, keep reading as we demystify it here at Hi.com.
Understanding Blockchains: How Do They Work?
Every time people talk about blockchain, what runs through their minds is Bitcoin and Ethereum. These are only a few of the blockchain networks.
A blockchain is a type of encrypted database. The data in the database is carefully arranged in blocks and chained together chronologically. The technology is very powerful because it provides excellent security.
Once a block of data is added to the blockchain, it is almost impossible for hackers to break. Again, the blocks on the blockchain are permanent because they require 51% of the network users to approve for changes. It is tough for hackers but excellent for you.
Benefits of Blockchain in Comparison to Traditional Banking
- The BlockChain Architecture
As we highlighted earlier, blockchain is made of blocks of data that join to form a sort of chain. It is kept this way using a method referred to as consensus, where different users have to validate data before it can be added to the block and embedded into the chain.
This implies there is no central control like the way banks operate. Therefore, the lack of a centralized point means that the data stored in cryptocurrencies are not prone to manipulation, whether by managers or hackers.
2. Excellent Data Storage and Handling
If you look at the traditional banks, they work with the CRUD (create, read, update, delete) model. Well, any of these processes can be used on stored data by a central authority. This raises the risk of data damage, loss, and misuse. If a rogue employee tampers with sensitive information, he/she can cause too much damage.
On the other hand, blockchain only supports two actions, reading and writing. This means that once a transaction is written on a blockchain, there is no getting it out. This is an excellent way to keep user data as safe as possible.
Unlike centralized data systems that work with central authorities to review and verify information, blockchains are different. Any person with the right equipment can join and become part of the network for verifying transactions. Since many nodes (users) on the network must come to a consensus, you are assured of high transparency.
Now, the technology has moved a notch higher, and some operations are relying on smart contracts. These are automated contracts where the terms and conditions are set, and they execute automatically when the involved parties meet the requirements.
4. Greater Efficiency
Bank transfers, especially those that involve cross-border payments, can take days. Imagine having to wait for three days to get your friend or relative money? Instead of using the lengthy route, the best alternative is blockchain networks. No matter where you are on the globe, transactions are completed in seconds. They are fast, reliable, and fun.
5. Better Traceability
When data is added to a blockchain, it is given a unique identifier code that includes the block’s info. The code also includes the code for the block that was ahead of it. Therefore, it means that tracing back who paid what and on which day becomes easy and fast. Because of this traceability, blockchain is an excellent way of preventing fraud.
As you can see, blockchain is the way to go. Its benefits supersede those offered by banks by a great margin. So, you should also join and get some crypto coins.
Wait a Moment …. What is Hi?
Hi is the first of its kind chat-based cryptocurrency platform that prioritizes making money for you, not off you. To use Hi, you do not need to download or install anything; all you need to do is using one of your favorite existing chat apps, such as Telegram or WhatsApp, and type “hi” in the chatbox.