Much of the software code that serves as the base for blockchain and cryptocurrency has been developed using open source software. Developers from all over the world have contributed to create, manage and expand on the software. It’s this open source approach that has created opportunities for business and consumers to use the blockchain in new ways across society.
What Is Open Source Software?
Open source software is created collaboratively by multiple developers that make the code available to anyone for free. It’s published in a transparent way and it’s not owned by anyone. Because much of the underlying source code used in blockchain is open, there are a lot of eyes looking at it. When a bug, flaw, or potential exploit has been uncovered, there’s a whole community of developers working together for the fix.
Instead of the software being owned by a single corporation, the software is developed by many and owned by no one. It’s this decentralization of development that makes for a reliable and sturdy codebase.
Open Source Development in Blockchain
You’ll often hear blockchain referred to as open source and wonder if the source is open, how can it be secure?
Blockchain software is made up of three parts:
- Cryptography
- Distributed Ledger
- Decentralization
It’s these three parts that keep blockchain secure.
In the case of cryptocurrency, for example, you need two cryptographic keys to access your wallet: a public and a private key. The public key is something known to everyone over the distributed network. The private key is known only to you. When you access your wallet, you can conduct transactions, such as transfer cryptocurrency to anyone over the network. The transactions are recorded digitally in your wallet and in records across the distributed network.
Secondly, each block in a blockchain contains a hash identifying the chains that came before. This makes each of the blocks independently verify each other. The chain can’t be broken. The integrity of this change can be verified by anyone with access creating a complex audit trail for verification.
Plus, the information contained in these blocks is decentralized. It’s not stored in any one place but in hundreds of thousands of places, each verifying the accuracy of each other.
Hacking the system would be exceptionally difficult. It’s not like hacking in and adding a few zeroes to an amount. It would take changing hundreds of thousands of records that are potentially spread across hundreds of thousands of networks and locations around the world. Although it has happened, it’s exceptionally rare.
Open Source Development in Cryptocurrency
Cryptocurrency also uses open sources as its underpinning.
The Bitcoin Core reference client features work by more than 450 developers that have more some 15,000 code contributions. These developers are unaffiliated and the public software is free for use. You can see the history of the development in a software repository that’s hosted by Github. The Ethereum project code is also available publicly on Github. Its codebase is the work of 120+ software repositories which focus on different parts of the code, such as smart contracts, network clients, or end-user graphical browsers).
Here is one of the reasons the cryptocurrency and blockchain networks being built on open source can be important. If the code was developed and implemented by a private company, it would likely need to register with the US Treasury’s FinCEN to be licensed to transmit money. If a company wants to market tokens as an investment, they may also need to register with the SEC. The regulations in these cases are important to ensure the parties involved in the middle of the transaction will hold up their end of the transaction.
Technologies such as Bitcoin, with a market cap of nearly $200 billion, can create a similar result using an open network instead of a single corporation’s proprietary software. They are still secure because of the distributed ledger which tracks and warrants changes and the complex chain of blocks that can’t be broken. The decentralized nature of cryptocurrency with trust markers spread across the internet is one of the fundamental ways that establishes the trust in accounting. Because it’s based on open sourced software, it’s less impacted by current regulations but no less secure than proprietary sources. The current price of bitcoin is one of the strongest indicators of its security and value.
The code behind this decentralized network is what allows users to trust each other in transactions. It’s open to anyone for free to use or modify by groups of passionate users and developers – all of which are independent of each other or corporations.
These are some of the reasons why so many people have flocked to cryptocurrency markets.
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The Bitcoin Core reference client features work by more than 450 developers that have more some 15,000 code contributions. These developers are unaffiliated and the public software is free for use. You can see the history of the development in a software repository that’s hosted by Github. The Ethereum project code is also available publicly on Github. Its codebase is the work of 120+ software repositories which focus on different parts of the code, such as smart contracts, network clients, or end-user graphical browsers).
Here is one of the reasons the cryptocurrency and blockchain networks being built on open source can be important. If the code was developed and implemented by a private company, it would likely need to register with the US Treasury’s FinCEN to be licensed to transmit money. If a company wants to market tokens as an investment, they may also need to register with the SEC. The regulations in these cases are important to ensure the parties involved in the middle of the transaction will hold up their end of the transaction.
Technologies such as Bitcoin, with a market cap of nearly $200 billion, can create a similar result using an open network instead of a single corporation’s proprietary software. They are still secure because of the distributed ledger which tracks and warrants changes and the complex chain of blocks that can’t be broken. The decentralized nature of cryptocurrency with trust markers spread across the internet is one of the fundamental ways that establishes the trust in accounting. Because it’s based on open sourced software, it’s less impacted by current regulations but no less secure than proprietary sources. The current price of bitcoin is one of the strongest indicators of its security and value.
The code behind this decentralized network is what allows users to trust each other in transactions. It’s open to anyone for free to use or modify by groups of passionate users and developers – all of which are independent of each other or corporations.
These are some of the reasons why so many people have flocked to cryptocurrency markets.
Matt Shealy is the President of ChamberofCommerce.com. Chamber specializes in helping small businesses grow their business on the web while facilitating the connectivity between local businesses and more than 7,000 Chambers of Commerce worldwide
