Blockchain technology is playing an important role in every aspect of life, in industries from financial services, manufacturing, and education to energy,… In this article, Twendee will provide readers with an overview of blockchain technology and how to make money from it.
What is Blockchain?
Blockchain technology was launched in 1991 by researchers Stuart Haber and W. Scott Tornetta. They want to study document security systems to avoid interfering and repairing. However, it is not until Bitcoin’s inception in 2009 that the use of Blockchain expanded to other applications.
Through many stages of development, up to now, Blockchain technology has 4 different versions, including:
- Blockchain 1.0: For currency algorithms (blockchain wallets)
This technology uses currency algorithms to support all transactions related to currency conversion, remittances and digital payment system settings within the cryptocurrency range.
- Blockchain 2.0: Used in the banking and finance industry
This technology is applied to handle the assets of the Finance – Banking industry such as shares, checks, debt, ownership and anything related to agreements or contracts in a transparent manner. , most clearly.
- Blockchain 3.0: Applied in many industries
Blockchain technology 3.0 is the 3rd generation blockchain that inherits the advantages of all previous Blockchain versions. This technology has been extended and integrated into many areas of life such as health, education, government or the arts.
- Blockchain 4.0: Business and Transaction Applications
It is the latest technology, created with the purpose of focusing on businesses, making it faster, safer and more complete to create and run trading applications.
Blockchain technology – a combination of 3 types of technology:
– Cryptography: to ensure transparency, integrity, and privacy, Blockchain technology has used public key and hash functions.
– Peer-to-peer network: Each node in the network is considered as a client and also a server to store a copy of the application.
– Game theory: All nodes participating in the system must comply with the rules of the consensus game (PoW, PoS, …) and are motivated by economic motivation.
The structure and working mechanism of Blockchain technology
Blockchain consists of 2 main parts:
- Blocks: These blocks contain data
- Chain: the above blocks link together to form a chain
Each block consists of 3 main components:
- Data: Verified data records are protected by cryptographic algorithms that depend on each blockchain.
For example: sender, receiver information, amount of coins sent…
- Hash Code: This is a randomly generated string of letters and numbers that are not exactly the same. It specifically represents the block and uses a cryptographic algorithm to encrypt it. This code is used to detect changes in the block and like our fingerprint: unique, not duplicate.
- Previous Hash code: It is used to identify which block is ahead and done which one is later in the chain, to properly link them together. However, the first block, because there is no block before it, its Hash is a sequence of zeros. This first block is called the Genesis block i.e. “Primitive Block” or root block.
Pros and Cons of Blockchain technology
Pros of Blockchain technology
- Improving accuracy by removing human involvement in verification.
- Reducing the cost by eliminating the verification process of third parties.
- Secure, private, and efficient transactions.
- Providing a banking alternative and a way to secure personal information for citizens of countries with unstable or underdeveloped governments.
Cons of Blockchain technology
- Low transactions per second.
- Data storage limitations.
- History of use in illicit activities, such as “Dark Web”.
- Changing data in a blockchain typically takes a lot of work.
- Users have to keep track of their private keys to avoid losing their money.
Key Features of Blockchain Technology
Blockchain technology was created to solve the limitations and risks arising from the conventional trading system. Therefore, Blockchain technology has the following outstanding features:
Blockchain technology operates independently according to computer algorithms and is completely not under the control of any organization. Therefore, Blockchain technology avoids risks from third parties.
Blocks contain the same data but are distributed in different places. So if somewhere is lost or corrupted, the data stays on the Blockchain.
Once data is written to the blockchain, it cannot be altered or modified due to the characteristics of the consensus algorithm and hash code. The data is stored forever.
Only the holder of the private key can access the data inside the Blockchain and retrieve it.
Transactions in the blockchain are recorded and can be viewed by everyone. So, it is possible to check and retrieve the transaction history. People can even be decentralized to allow others to access part of the information on the Blockchain.
Smart contract integration
Smart contracts are digital ones created by an if-this-then-that (IFTTT) code in a technology system. These contracts allow the blockchain to execute things on its own, without the need of a third party. The terms are written in the smart contracts, when the previous conditions are met, they are executed and no one can stop or cancel them.
Cannot be destroyed or forged
In theory, only quantum computers can interfere with and decrypt the blockchain technology. Blockchain technology can be completely destroyed when there is no Internet left in the world, but of course, this is not possible.
How to make money from Blockchain technology?
Invest in Cryptocurrency
The technology behind Cryptocurrency is blockchain. One of the top coins is Bitcoin, which started its journey in July 2009. On April 1, 2013, one bitcoin was worth $133.76. As of April 1, 2017, the same bitcoin was worth $1,089.51. By December 2017, Bitcoin had crossed $10,000 for each one.
However, Bitcoin is not the only cryptocurrency. There are Ethereum, Ripple, Litecoin, and more. These are big markets for speculation, and indeed a lot of people know about Blockchain technology through these crypto market news.
Currency investing is buying, selling, and holding currencies for a profit. All forms of money are speculated. Due to the volatile nature of the crypto market, there are a lot of opportunities and risks here. You need to understand and make informed decisions when participating in investments.
The cryptocurrency market changes with a large price range. You can face cash flow problems. However, if you have some idle capital, then cryptocurrency investment can also be a good choice.
Build your own Blockchain app or company
After cryptocurrencies began to gain traction, the scientific and research community saw more potential. The Ethereum project is based on blockchain technology. It also has a coin called Ether.
But the most notable point here is the smart contract. Smart contracts allow two parties to execute legal contracts through digital code. It could change the way we conduct business and conduct transactions in the future. And there are many other opportunities.
BitClave (BitClave – Decentralized Search Engine), a decentralized search engine, is directly connecting consumers and businesses. The platform will eliminate the need for an intermediary like Google, Yahoo, or Bing to track consumer information. BitClave will allow consumers to own their own data and disclose it to businesses on a consensus basis. The data will reside on the BitClave blockchain.
Nasdaq is looking to build a blockchain-based voting system for electronic shareholders. Similar voting systems can also be used for government elections. Identity documents, real estate, and collateral are moving to the blockchain. Companies with copyrighted material such as books, music, and videos are looking to blockchain technology for protection against piracy.
If you are interested in building a technology company, blockchain technology has opened the door to a lot of opportunities. You can be the next Twitter or Facebook success with this new technology.
Providing Services for Blockchain technology
If speculation or building new companies is not your thing, you can still work in the blockchain industry. With the rise of blockchain-based startups, the demand for people with blockchain skills is growing. It’s not just programming.
These companies need people with finance, marketing, and management skills. Free and paid courses are available. You can invest time and money to understand blockchain technology to further your career. Or you can start making money by providing freelance services to these companies.
Blockchain technology can be used for “crypto faucets,” another method for generating money. For those who are not ready to spend the time and effort mining, these crypto faucets will provide an alternative means of earning and sharing coins. This technique usually uses workers who are not familiar with the mining process to avoid the technical problems of bitcoin mining.
These websites allow users to earn bitcoins by performing tasks on their platforms. It includes seeing an ad, deleting a captcha, or playing a game. Satophis, the smallest possible unit of a bitcoin, is used to compensate participants. One bitcoin is worth 100 million Satoshis.
Ads charge for clicks and views. So these crypto faucets generate cash by distributing ad revenue to their clients. Plus, it encourages visitors to stay on the site and engage with the content.
There is no way to make a lot of money with a bitcoin faucet. Pay is reduced as the task is simplified. Most sites need your payment and prize to complete the activities that are included in the website’s digital wallet. After meeting a small criterion, the user can get this money back. Using the best virtual currency faucets can take as little as a day, but usually takes at least a week.
Freelancing, Blogging and Other Online Tasks
You can perform various crypto earning activities on popular freelance websites like Cryptocurrencyjobs.co.
Some of these opportunities will involve performing simple tasks such as editing or writing essays, completing online surveys and blogging. Depending on the site you work for, you may be paid in cryptocurrency or fiat currency. Either way, if you are interested in writing and blockchain, writing regularly and producing unique content can bring a considerable amount of money.
As we mentioned earlier, this can be a risky decision for newcomers to the blockchain industry, but trading Bitcoins (and other cryptocurrencies) is incredibly profitable. For several years now, crypto enthusiasts and bitcoiners have advocated the benefits of acquiring these digital assets.
If you’re good at chart analysis and assets trading, you can make considerable profits by regularly swapping digital assets online.
However, learning how to trade Bitcoins isn’t easy. If you’re looking to make money with blockchain through crypto trading, you’ll first have to make a few digital asset purchases and then make the correct market moves by knowing exactly when to trade. To do this well, you must hone your trading skills through regular practice by studying technical charts, analyzing trends, keeping up with global news and other factors that affect cryptocurrency prices.
Anyone can make a career out of trading popular digital assets on crypto markets. Unlike the stock market, trading goes on consecutively, so you can grow your assets and profits online with each passing day.
Staking and Interest – Earn Passive Income on Idle Cryptocurrency Tokens
There are two considerable concepts in the cryptocurrency markets that enable you to earn passive income on idle digital tokens that you own. The first is crypto staking, which involves locking your tokens away for a certain amount of time to help validate transactions on proof-of-stake blockchain networks.
Examples of leading staking networks include Cardano, Tron, and Ethereum. Crucially, you will receive a rate of interest for as long as your tokens are locked away. With that said, if you engage in staking on the eToro platform – you won’t be required to meet a minimum lock-up period. Instead, you can withdraw your tokens at any given time.
The second concept to consider when learning how to make money with cryptocurrency in a passive manner is through an interest account. In its most basic form, crypto interest accounts operate in a similar nature to a traditional bank. This is because by depositing your cryptocurrency tokens, you will be paid a rate of interest.
However, unlike staking, your crypto tokens won’t be deposited into a smart contract. On the contrary, your chosen provider will lend your tokens to those that need to borrow funds. And therefore, the borrower will pay you a rate of interest for as long as the tokens are being lent out.
Blockchain technology offers not only promises but also many risks. Learn more about this market and make the right decisions. Of course, if you can make money from Blockchain technology , that would be great! Good luck!