What it is....
Nowadays we heard this term plenty of time and which forced us to think about this and poke us to know about this, in simple way block chain which is also called block chain is the type of list which grows continuously and stores the record for the retrieval. This list is just like a link list but it is secured using cryptography.In this list, each block contains a hash pointer which is used to link the previous block of the list with a one-time stamp.Because of this unique feature, it's very difficult to modify once it is created.
Why it is....
Due to its unique feature, it can be used as a ledger which is open in nature and hard to modify and can record transaction between two individual parties. So who manage this enormous list.The answer is nobody manages it and it manage by the peer-to-peer network following the protocol for validating new blocks. The security in block chain is, once it gets recorded and data is put into the block, then it cannot be tampered or altered without the alteration of all subsequent blocks and these blocks required the collection of the network majority.
How secure it is.....
The design of the blockchain is very secure and which uses the power of distributed computing with high Byzantine fault tolerance. To understand the block chain we must need to know the Byzantine fault.
The system using Byzantine fault tolerance is immune against failures, in which every component of a system fails in arbitrary ways not just by stop or crash but by processing request incorrectly or corrupting their local states or producing incorrect/inconsistent outputs.
To understand the Byzantine fault tolerance lets see one example.
1. Byzantine fault: It is an incorrect operation which occurs in a distributed system and which can be classified as : Omission failure: In which system not present to respond to a request or not present to receive the request. Lying or Execution Failure: This happens due to sending incorrect or inconsistent data, or corrupting the local state or incorrect respond to the request. Its happen normally in round-off errors passed from one function to another and so on....it also happens if corrupted system databases where the error is not detected.
This is obviously difficult to understand so let's take a real-life example... Our example(ARMY) have three things.
Now consider there are several armies and each one is under the command of generals which are camped outside a city, which they plan to attack. Now the situation is, one of the generals will issue the order to attack and one of the several generals may be traitors.In our case all the generals must be loyal to win the battel and all the generals must attack at the same time.The traitor will attempt to fool the loyal generals so that they will not attack at the same time.
Now, to win the battel we need to check the authenticity of the order and one easy way to check is crosschecking. So general have to communicate with another general to crosscheck the order. In this situation, every, general need to exchange the message of order to prove the authenticity of the order. But As we know some generals are a traitor so its impossible to trust the order. This is the Byzantine problem.
Now consider, Distributed computing has several machine/people and to rely on them is very difficult.
What is the solution....
Blockchain gives the solution to Byzantine problem by giving the trusted ledger on which we can rely and ensure. As we know Distributed computer network usually have millions of billion members and no centralized command they follow and if we talk about the trust, so it impossible to know each member of the network. So The only solution is to make the channel trusty on which we are going to transact.
To make the channel trusty, and blockchain is secure by its design having high Byzantine fault tolerance. And that is why it is most suitable for recording the financial transaction like Bitcoin which is decentralised in nature and that is why bitcoin made it the first digital currency to solve the two side spending problem without the need of trusted authority or central server or governing body.