Cryptocurrency is moving beyond fringe investing and toward more mainstream acceptance. One reason is the idea that the chain of transactions can never be changed or broken.
If that's true, it means that cryptocurrency could be safer than paper money or the digital numbers in a bank account. But is it true?
Chances are we will soon see as digital bandits will almost certainly line up to test the technology.
Blockchain is a digital ledger that keeps a computerized record of all transactions, whether that involves moving currency or executing contracts. Transactions happen directly between people and no single party controls the data or information.
As Harvard Business Review explains, once a transaction is entered into the blockchain database, it's linked to every transaction record that came before — a chain.
The records of the transactions are permanent, chronologically ordered and available to everyone else on the network (who may remain anonymous or reveal their identity).
That's why it is said that the blockchains can't be broken or changed — the idea of immutability. Blockchain ledgers are touted as permanent and unalterable histories of transactions because any tampering of one block would disrupt the chain and the break would be easy to pinpoint.
But is blockchain foolproof?
Experts say not so fast. It is possible, though expensive and extremely difficult, to recreate an entire blockchain if the parties are in cahoots. And immutability is not always a good thing — what about private information accidentally landing in the wrong hands, for example? This is an unnerving prospect in a technology that is nearly impossible to undo.
Like any technological advance, blockchain holds promise, but there is still a lot to learn about its benefits and pitfalls.
