The Blockchain

An Introduction to Blockchain, Bitcoin ₿, and related concepts

An example of a blockchain. Image by Martin Thoma.

Bitcoin crossed $40,000 USD for the first time recently, so it’s again in the news. Bitcoin is just the most-known cryptocurrency. It is one application using a blockchain. In this article, I will walk you through some core concepts of blockchain and cryptocurrencies. This article is written for beginners and a bit fluffy in some areas. There will be follow-up articles to address that. Let’s start!

The Idea of a Ledger

German Ledger from 1828 (Source: RaphaelQS)

Suppose we lived in a simpler world without credits and with only one bank. Everybody just owns a non-negative amount of money. The bank keeps track of transactions. Let’s say we have three students living in the same shared apartment: Anna, Bob, and Charlie. They all put $100 USD in their bank account:

Date             | Sender    | Receiver |  Amount
-------------------------------------------------
2021-01-01 06:00 | (Deposit) | Anna     |    $100
2021-01-01 06:01 | (Deposit) | Bob      |    $100 
2021-01-01 06:08 | (Deposit) | Charlie  |    $100