Building Blocks

Blockchain is a decentralized, distributed and public digital ledger that is used to record transactions across many computers so that any involved record cannot be altered retroactively, without the alteration of all subsequent blocks. Thus, let’s user to confirm and audit transactions independently and cheaply.

Blockchain is thought to be conceived by someone or people called Satoshi Nakamato in 2008.

Blockchain database is managed anonymously using a peer-to-peer network and a distributed timestamping server. Blocks hold batches of valid transactions that are hashed and encoded into a Merkle tree. Each block includes the cryptographic hash of the prior block in the blockchain, linking the two, resulting a chain. Process validates the properties of the previous block to the original genesis block. Blockchain is hosted by millions of computers simultaneously, meaning data is available to anyone on the internet, making it very hard to being hacked.

The block time is the average time it takes for the network to generate one extra block in the blockchain. Once block time is up, the included data becomes verifiable. In cryptocurrency, it’s when the transaction takes place, so a shorter block time means faster transactions. The block time for Ethereum is set to between 14 and 15 seconds, while for bitcoin it is 10 minutes.

A blockchain is a simple and smart way of passing information between two entities in a fully automated and safe manner. A block is verified by thousands, maybe millions of computers across the net, a unique record and unique history being created. Falsifying a s single record would mean falsifying all the chain in millions of instances. It’s almost impossible to do. Bitcoin is an application of blockchain but there are more applications.

Blockchain being nearly impossible to corrupt, meaning it can be a very cheap facilitator. For instance, a musical artist can sell their album directly to the consumer without having to go through a record label and distributor. Reason this is possible is that blockchain transaction facilitating the transfer of the album is FREE. If this happen, streaming services like Spotify and Apple Music will cease to exist.

Blockchain can be broken down to 3 facets:

Decentralization

Transparency

Immutability

Facet 1: Decentralization

A centralized system holds all the data that a specific information can be retrieved. In a decentralized system, data is not stored in a single location but stored in multiple locations.

Facet 2: Transparency

Transactions that uses blockchain can be seen but the recipient and sender’s identity and personal information will be safeguarded.

Facet #: Immutability

After an entry has been entered, it can never be edited again. Blockchain is a recorder of events, it keeps adding event instead of editing or deleting previous entry.

Blockchain might seem like a new technology but it’s not. It’s an amalgamation of the being utilized in a new way. Combining the technologies of internet, private key cryptography and a protocol governing incentivization. Resulting in a system of digital interactions that does not need a trusted third party. Facilitating secured implicit digital relationships, and supported by the elegant, simple and durable network architecture of blockchain technology itself.

Sources

Hamirani, Ashish, et al. “Blockchain.” Wikipedia, Wikimedia Foundation, 24 July 2019, en.wikipedia.org/wiki/Blockchain.

Rosic, Ameer. “What Is Blockchain Technology? A Step-by-Step Guide For Beginners.” Blockgeeks, Blockgeeks, 26 July 2019, blockgeeks.com/guides/what-is-blockchain-technology/.

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