Oversimplified: What The Heck Is Blockchain?
By Yusuf Olalere on ALTCOIN MAGAZINE
Don’t get left behind! Blockchain is the next big thing! It will change the world! You can make money from Bitcoin! Everything will become decentralized! Cryptocurrencies!! Bla bla bla!
High chances are the first time you heard about blockchain, someone was chanting one of the phrases above. One question I keep asking is, What the heck is blockchain? and how does it fit into the existing ecosystem of technology products?
In The Beginning There Was Blockchain
Before we continue let us make a very quick and short clarification; chronologically, blockchain came before bitcoin. Bitcoin came into the picture in 2009 but computer gurus have been dancing around blockchain since the ’90s. Bitcoin just happened to be the first application of blockchain that went mainstream, thanks to one blockchain guru called Satoshi Nakamoto (not real name). Using an analogy, Bitcoin is to Blockchain what Facebook is to the Internet.
Why The Hype?
The popularity of bitcoin has brought lots of attention to the technology powering it; Blockchain. To understand the hype, let us put blockchain in perspective and forget about bitcoin for the rest of the article.
People hype technologies when they have reasons to believe it will affect not just one industry but the entire human system They believe this technology has the ability to change the way we live, work, play, relate, travel, name it, all aspects of life. Just like the internet did.
Printing press filled the knowledge gap; more books, Engines filled the power gap; bigger industries, Internet filled the distance gap; information travels faster, and it is believed that Blockchain will fill the trust gap;
Trust Gap? What Is So Special About Trust
How long did it take you to trust the most reliable person you know? What would you say if I told you that in the not too distant future, it will take less than a second to completely trust people you haven’t met before (complete untraceable strangers), no previous recommendations whatsoever from friends, family or trusted parties. Plus they won’t be able to break your trust even if they wanted to.
If it takes less than a second to trust someone, it actually means you don’t have to trust at all to do risky transactions with them. But where did the trust disappear to? who took it? blockchain took it, it automated it.
You could work with the most evil of people and not bother to ask yourself if they will cheat you or compensate you...
Before we go into how blockchain automates trust, lets pause for a second and think about the kind of things that we could do if we didn’t need to ask around about someone or look them up to transact or work with them. You could work with the evilest of people and not bother to ask yourself if they will cheat you or compensate you because you know they can’t even if they wanted to. Your trust machine got you covered. Now I’m thinking about the usefulness of this in electing political representatives and holding them accountable to their promises. Juuuust thinking.
But How Does The Blockchain Do This Trust Thingy?
Now you are treading the technical space. But let's keep it simple, blockchain is an Immutable Distributed Ledger. Analogy again, why will you keep all of your life savings with a foreigner you met 5 seconds ago? Crazy right? But remember it won’t be crazy if you kept your life savings in a box kept in a blockchain and you gave it to them. And why will you be able to sleep well at night knowing fully well your life savings is with a total untraceable stranger?
Blockchain Is Immutable
First, anything kept in a blockchain is immutable, it cannot be changed or altered, it is sealed. To understand how blockchain achieves this you need to understand cryptographic hashing (you can learn this later). It means you rest assured that the foreigner who you gave your box to can’t touch a dime of your savings, even if they wanted to.
Blockchain Is Distributed
Secondly, anything kept in a blockchain somewhere is duplicated and exact copies of it are kept in several places called nodes. It means whatever valuables (in this case your savings) kept in a blockchain exist in lots of places all at once, the same exact thing (keep in mind that this is only possible in the digital world). If you kept your savings with a stranger in France, a node containing the same exact box with all your savings could be in your street in Nigeria without altering or tampering with your savings in France. If you as the owner with your own private key were to take your savings, it will disappear everywhere on the blockchain, but if your foreigner altered what you kept with them (which is very difficult), the blockchain will automatically replace the altered version with the correct version from other nodes around the world. You might want to read that again.
Blockchain Is A Ledger
Simply put, a ledger is a record of things. Whatever goes into a blockchain is immediately recorded into a ledger, it was designed to work that way. That savings you kept with the foreigner automatically became a record in a ledger immediately you put it into the blockchain.
In a simple summary, a blockchain is a shared, a record of things that can’t be altered. Blockchain won’t save the world but at least it will protect people from people in cases where the value of a thing is dependent on how the information about it is structured e.g Money, Election results, Music streaming, etc. Bitcoin seems to have brought blockchain on everyone’s radar, but the blockchain is much more. Much more!
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