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Different Versions of Blockchain
Learn about the different versions of blockchain.
Submitted by Vaishnavi Srivastava, on January 10, 2022
Blockchain is a game-changing technology. Surprisingly, blockchain technology is not only secure, dependable, and efficient, but the concept is also simple to grasp and apply. It's similar to an online excel sheet that guarantees data security, robustness, immutability, decentralization, and other benefits.
Businesses require data and information to operate and expand, and the data must be reliable and delivered quickly. This data can pertain to transactions, records, and assets, both tangible and intangible. Blockchain is the ideal answer for the coordinated supply of data since it provides rapid, shareable, and trustworthy data that is recorded on a secure and strong ledger that cannot be tampered with.
To summarize, Blockchain is an immutable, decentralized, distributed ledger that records transactions and assets in a business network.
Blockchain has progressed over the years in the form of Versions.
Blockchain versions are nothing but a representation of the evolution of Blockchain technology.
There are three versions of Blockchain:
1) Blockchain 1.0: Cryptocurrency
The use of Distributed Ledger Technology (DLT) led to the earliest and most evident use of the technology: cryptocurrencies. Hall Finley introduced Blockchain Version 1.0 in 2005, which incorporates DLT (Distributed Ledger Technology) and is the first application based on Crypto money. This enables the execution of financial transactions based on blockchain technology or DLT, with Bitcoin being the most prominent example in this area.
Blockchain is currently Internet cash, a digital payment system, and it has the potential to become the "Internet of Money," linking the money in the same way that the Internet of Things (IoT) links machines. Bitcoin and its forerunners have the potential to revolutionize currency, trade, and business. The first and most obvious application is currency and payments.
2) Blockchain 2.0: Smart Contracts
The new version of Blockchain was created in response to an issue in version 1.0, which was that mining Bitcoin was wasteful, and there was also a lack of network scalability. As a result, the problem has been solved in Version 2.0. The Blockchain in this edition will not be limited to cryptocurrencies but will also include Smart Contracts.
The phrase "Smart Contract" was coined in the 1990s by Nick Szabo in an academic study. Smart contracts are contracts that are written in code and designed to follow a set of instructions. They are safe, devoid of third-party interference, transparent, and precise.
3) Blockchain 3.0: DApps
Decentralized apps, or DApps, are essentially a collection of linked smart contracts. Smart contracts are computer programs that carry out a set of instructions. DApps are decentralized apps that combine smart contracts into packages that can be interacted with by users.
A DApp is like a traditional app in that it can have a frontend written in any language that calls the backend, and the backend code runs on a decentralized peer-to-peer network. Unlike centralized programs that run on centralized servers, such applications use decentralized storage and communication, such as Ethereum Swarm and other similar systems, and most of their backend code runs on a decentralized network.
Many decentralized applications exist, such as BitMessage, BitTorrent, Tor, Popcorn, and others.