Is Blockchain and Bitcoin the same things?
Many people confuse these two technologies and believe that both are the same. In fact, they aren’t. Blockchain and Bitcoin are very different from each other, and Bitcoin is actually the first application of Blockchain. Blockchain has undergone several modifications since it’s first inception and has now been applied to other industries as well. To make things clear, Bitcoin is the digital currency that helps people to encourage safe transactions. Since it is physically not present, one cannot steal it. Although it isn’t used by a lot of people, it definitely helps to cut down third-party interventions and encourages money transactions across borders. This is called the cryptocurrency. The blockchain performs a ledger like action, and it basically keeps the currency secure.
These Terms were Used Interchangeably in The Initial Phases
When it was that Bitcoin was the only application of Blockchain, what happened was people used these terms interchangeably. Then, of course, the technology evolved, and there were more extensions and uses of Blockchain other than the Bitcoin, and that is when things diversified. People experimented with different genres and came up with name registry that would be decentralized, or delivering messages between peer in a discrete manner. Thus, Blockchain is not in itself Bitcoin but is the basis on which Bitcoin has been created. We could think of Blockchain as a chain of blocks, interlinked, which would hold information, data, other relevant stuff, and they would be bundled together. These blocks would be chained and used whenever required.
Understanding the Concept of Cryptocurrency
Bitcoin is a cryptocurrency that is used by a lot of people to make safe transactions. This has all to do with the use of tokens, that depends on the Blockchain technology. This is thus a tool of the Blockchain technology that has been discussed so far. Buying, selling, investing, monetary transactions and more can be easily conducted with the help of Blockchain technology tool – which is the Cryptocurrency.
Comprehending the differences between cryptocurrency and blockchain, and how they work in unison:
The Blockchain platform helps to bring the cryptocurrencies in vision. Since it is a dispersed network that controls the network, this platform helps to transact the money and helps to transfer valuable information and data. These Cryptocurrencies are the tokens which are used within all of these networks, that create value. These act as the utility or tools, and they are used to digitalize the value of an asset. Thus, Blockchain is the basis of any application, and cryptocurrencies are only the parts of this large ecosystem. A cryptocurrency may be needed to access the Blockchain technology – hence they are interdependent. But it is important to notice that without the presence of Blockchain, it would be impossible to transact the data.
Are Bitcoin and Blockchain the same?
Of course, now that we have gone through the intricate differences, we can point out that the above statement is false. It is more of a set and subset concept. Bitcoin and Blockchain are closely related, but they are in no way the same. There was a time that Bitcoin coding was left out in the open, and Blockchain was also present in the same wrapper – so both are interlinked.
Exploring More Subtle Points of Difference
Bitcoin is an unregulated cryptocurrency that was invented by Satoshi Nakamoto in the year of 2008. The reason for its existence was to dismiss off the government rules that are associated with the monetary transactions. The idea was to eliminate all government controls, such that there shouldn’t be any third-party interferences. There was a desperate need for very secure transactions, which was achieved through the Blockchain technology. This technology involved very simple principles – a ledger was distributed that was connected from peer to peer, and the network was open, public and anonymous in nature. This helped in secure transactions over the web.
Thus the Bitcoin blockchain was born, which had nothing but a simple storage database of Bitcoin transaction records. This has no regulating authority present – thus the participants must agree upon the currency and the transactions before they can be recorded. The process of this consensus is achieved by the process of mining.
Right after there are Bitcoin transactions, the miners immediately confirm the legitimacy of the transactions through some complex equations. A proof of work is generated thereafter. This should provide sufficient data as to the transaction really happened. For every safe and valid transaction, the users must have proof of work present. This is important to all the users and is compulsory. Thus, the transaction records now cannot be tampered with, or changed, because now they are integrated into the blockchain records. It is almost impossible to play up with the blockchain records because it is dispersed in nature.
Using Blockchain in Business
The Bitcoin Blockchain was specifically built for the platform of cryptocurrency – there was a time when people confused these two as one because no other applications of Blockchain were out then. But now, of course, things have gotten into perspective, and we have specific uses of Blockchain that are diverse in nature. The technology also has been majorly modified to adapt to different businesses. The following are the differences that had to be adapted if the business taken in Blockchain:
Adapting in Assets Over Cryptocurrency
Blockchain can be very easily used for assets over the use of cryptocurrency. Tangible assets can be pooled in, like cars, houses, or even food can be pulled in. even intangible assets like bonds, securities can participate in this. A lot of people are working on the legitimacy of all of these products, and there is constant work being done in this direction.
Anonymity Pushed Aside and Identity Embraced
Bitcoin was all about anonymity, but businesses will always have an identity. Bitcoin will not have any clear information, but businesses always have KYC numbers and AML values that will ensure no fraudulent transactions. Everyone in business will need to know who they are dealing with, and to avoid discrepancies, there will be clear let out information.