The Blockchain Phenomenon

Learn about the technology building your future

If there is one subject everyone should learn about to be ready for the future, it is definitely all things surrounding the revolutionary, digital phenomenon known as Blockchain technology.

The world is fundamentally built on the basis of contracts, records and transactions. They define the manner in which assets are protected, identities are verified and organisations interact with one another. Global reliance on the aforementioned is not a recent development, but a historical one riddled with conflicts and adversities in the regulation and administrative control and its inability to adapt to the digital transformations taking the world by storm.

The dawn of a new era of technology proposes the blockchain as the key solution to said problems. As an open and distributive ledger, blockchain technology promises transparency and security for involved parties in a way that could not have been achieved before.

Deciphering the Blockchain Process

Blockchain technology, in its essence, is a decentralised ledger of transactions across a peer-to-peer network. In other words, it records transactions between two or more parties in an efficient and permanent way without the involvement of a centralised authority or managerial power. The blockchain inherently nominates systems that process and store information in transparent and shared databases that are shielded from tampering and revision, building a world that eliminates intermediaries and relies on technology to validate and secure records.

The blockchain process, fundamentally, is relatively straightforward:

1. A transaction is requested and subsequently creates a block that represents it. Each block consists of the relevant data, the hash of the block (an alphanumeric record that acts as a fingerprint) and the previous block’s hash.
2. The block is then sent out to every node (user or computer within a blockchain) in order for the transaction to be validated and verified.
3. Nodes then receive a reward for the Proof-of-Work, an essential mechanism that slows down the process and prevents tampering of the blocks. In other words, in order to add a new block, the user would need to determine the necessary proof-of-work.
4. The block is then added to the existing blockchain and the transaction is complete.

The Architecture of the Blockchain

In order to truly understand blockchain technology, it is pertinent to highlight the role of decentralisation. The blockchain was developed on the basis of it being decentralised and distributed, ensuring that actions and tasks were delegated away from one centralised authority. To clarify, centralised networks suggest that all nodes should be connected and redirected to one singular node or authority, granting them full access and power over the records. Whereas decentralised and distributed networks have no assigned authority and rely on interconnected nodes.

Harvard Business Review summarises these characteristics of the blockchain to five fundamental principles:

1. Distributed databases: each person in the party has access to the database and the entirety of its history. There is no singular entity in control of the data and every person can verify records without an intermediary.
2. Peer-to-peer transmission: communication travels directly between peers as opposed to a central node.
3. Transparency: each node and user on a blockchain has a unique alphanumeric address that identifies and allows them access to respective systems and transactions. It is upon the user’s discretion to decide whether to disclose their identity or remain anonymous.
4. Irreversibility: once a transaction has entered the database, the records cannot be altered as they are linked to preceding transaction chains and algorithms ensure permanence in the system.
5. Computational logic: the digital nature of the blockchain allows users to set up their own algorithms and rules that trigger transactions between users and nodes.

Innovations as Extensions of Blockchain Technology

Blockchain technology has proved to be the foundation of various revolutionary innovations, the most notable being cryptocurrencies such as Bitcoin and Ethereum. It allows people to build trustless systems, where there is no longer a need to know things about other parties and individuals and sole dependence on the technology. In the case of non-fungible tokens (NFTs), the blockchain acts as a public ledger that stores records of the ownership of any unique piece of digital data. For instance, take the example of CryptoKitties, one of the earliest NFTs. The unique and identifying information of each token is stored in its smart contract–a simple program that is stored on the blockchain–and is permanently recorded on that token’s blockchain. You can read more on NFTs in our previous article, Everything You Need to Know About NFTs.

Cryptokitties

However, it is amiss to assume that the blockchain can only be utilised for the purposes of executing cryptocurrency and NFT transactions–its self-sustaining and peer-to-peer operations open doors for companies and individuals to negate the decades-old problem of the role of intermediaries in the simplest of transactions. It presents a future where malpractices such as voter fraud are eliminated, consumer privacy and protection in healthcare is elevated and financial services are made transparent and accessible for all. At its core, blockchain technology is the future of not only how the world runs, but also how people work together.

Connect with Us

Follow us here, and on Twitter to get news, and look out for our Discord for deeper connections with the community of futurists, artists, collectors, and creators we have brought together.

• Anas: twitter.com/ananasbrb
• Danosch: twitter.com/thecryptosheikh
• Rahim: twitter.com/rahim_mahtab
• Zayaan: twitter.com/thenftpenguin
• Sam Z: twitter.com/zuckerswag
• Kristel: twitter.com/atelier_kristel

Thank You

Thank you for getting involved early in the Arts DAO journey. We are dedicating every moment we have to building and being part of the evolution of blockchain technology, the NFT space, and art more generally. We look forward to meeting with you either in one of our real-life events or elsewhere in the metaverse!