the blockchain for beginners

layers of a blockchain

consensus mechanisms

bitcoin - OG daddy

ethereum - super computer

applications of blockchain

Glossary

When you hear of Bitcoin, and Ethereum, you usually hear about Blockchain. But what is it and why is it important?

👉 A blockchain is a public database that is updated and shared across many computers in a network. -

Ethereum.org⁠

⁠

Plain & simple, blockchain is records of data stored on networks of computers.

Blockchain technology was first written about in 1991, but its first real application was Bitcoin. The reason it is important is because it is the foundation of Web3.

The innovation of Blockchain is that everyone is able to access to the same database. Before Blockchain, there wasn’t an easy way for two entities to share access to the same database or access the same information simultaneously.

For example, for digital money to work without Blockchain, multiple entities would need to keep track of their own versions of a ledger, or transaction history. So if I made a transaction, everyone one would need to update their ledger. But, with Blockchain, if I make a transaction or do something then everyone knows and the ledge is automatically updated for everyone.

Let’s put this into an analogy: Word vs. Google Docs

Before Google Docs, where everyone can edit the same document at the same time, we had Word documents. If you’re working on a Word document with multiple people, you need to update the document, send it to everyone, they read it, update their copy, make changes to yours then send it back.

Now with Google Docs, everyone is able to access the EXACT same copy at the same time, and can edit it in real time. All changes to the document are transparent and completed instantantly. Didn’t Google Docs make editing SO MUCH better?

That is what Blockchain is doing for the Internet.

Right now for Bitcoin’s Blockchain, only transaction data is recorded on the Blockchain. The way this works is that everyone has their own Wallet Address, and when money is sent to and from wallets, all of that information is recorded on the blockchain.

The Pillars of Blockchain

Depth

Depth

Pillar

Decentralized

Transparent

Immutable

What is it?

The data that is stored on the blockchain is stored by multiple computers and databases around the world, so no one entity has complete control.

All of the data and transactions recorded on the blockchain are open for anyone to see.

Once the data is put onto the blockchain, it is impossible to forge or alter the data.

Why is it important?

There is no single point of failure. If the credit card company Visa stopped working, no one could use their credit card, but with Blockchain, millions of points of failure would need to occur.

No one is able to alter the data, which means can’t change history. Imagine if we used Blockchain to see how the Federal Government was spending our money.

Once a transaction occurs we can’t change it. That means there is no deniability. Once code is written on the blockchain, it will run exactly as it is suppose to.

There are no rows in this table

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*Assurance: You might be thinking, “Wait, I don’t want people to know what I am doing?”. With blockchain, we can see what an individual wallet or address does, but we don’t know who owns that wallet or address. Lots of people choose to stay pseudonymous.

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