Explaining the Blockchain with Lincoln Logs
When learning about Blockchain, I’ve found it to be easier to understand the basic premise if the person explaining it is not an “expert” on the subject but rather a teacher who can explain complicated concepts in everyday language and examples.
Thus, I will not be explaining the Blockchain and its uses at a college level, but rather in a way that, hopefully, will stir up memories of your past and give you some understanding of our communal future.
Think back and imagine the widely loved toy of our youth — the Lincoln logs — you know, those connecting wood logs that fit together in different ways to build up little structures or cabins.
The most important thing when considering the functionality of Lincoln logs is the logic behind how they fit and the rules that they are bound to; Blockchains are very similar.
A blockchain is like a single Lincoln log that is put together with other logs. What happens when they are put together? They become linked. Now imagine if the name of the creator of these lincoln logs, Frank Lloyd Wright and the date of individual creation was printed on each log.
Regardless of the order, pattern, or structure these logs make up, you (or anyone who comes and looks at your logs) will be able to tell exactly who created each one and when. The verifiability and auditability brought about by this, now public info, printed onto the logs allows us to ensure each piece we use is part of the original game.
Now, once our structures get viewed or played with, nobody ever has any concern of counterfeit pieces or pieces from a different set — we have totally auditable authenticity.
Now, with the concept of auditable authenticity in mind, let’s define the blockchain; A blockchain is a distributed ledger whereby every piece (each Lincoln log) holds the same information and all of them fit together one piece at a time. What differentiates the blockchain from our Lincoln log example is the ability for far more information than just a name and a date to be ‘inscribed’ onto every block.
To follow suit with our Lincoln log example, however, the blockchain — like our inscribed Lincoln logs — allows for completely auditable authenticity. As a distributed digital ledger, all information written to the chain is made completely public and immutable (cannot be changed). Furthermore, since the ledger is completely distributed amongst all those who use or access the blockchain, authenticity can be confirmed by multiple people and nothing put on the ledger can ever ‘disappear’ or ‘go missing’, thus ensuring information accuracy through a complete lack of centralized trust.
Now that we have a general understanding of what a blockchain is, we can ask the question ‘What can it be used for?’
Now, we all know how valuable and important Lincoln logs were to us as children, but let’s take the perspective of the famed creator — and lover — of Lincoln logs, Frank Lloyd Wright, for a moment. Let’s imagine for a second that Mr. Wright, in his endless devotion to his creation, decided to paint his favorite Lincoln log structure.
This painting, as a masterful piece of expressionistic artwork, was seen by Wright as the ideal expression of his life’s work. As Lincoln logs became more and more popular the painting quickly grew in value and, by the end of his life, Wright had already seen a number of copies and forgeries. As the piece had accumulated a large value, Wright wanted to ensure that the painting’s authenticity never comes into question.
To do this, Wright personally writes a certificate of authenticity for his painting; now, no matter where the painting went, so long as this certificate of authenticity was available, the painting could never be mistaken for a forgery.
The issue with this form of authenticity is that each transaction (or ownership change) requires a level of trust in the seller to provide a non-forged certificate of authenticity and/or painting.
The blockchain, which, as we mentioned earlier, does away with the requirement of centralized trust, would be a perfect mechanism of authentication for the piece. Imagine now that every piece of art that is given a certificate of authenticity is put onto a massive ledger that every art dealer, artist, buyer, or average Joe can look at.
With each detail (down to the most minute droplet of ink) categorized and authenticated throughout this ledger, forgery would become next to impossible — it would be extremely easy to authenticate the original painting. Furthermore, with the inscriptions painted onto the blocks, we could authenticate the original Lincoln log set used as the painting’s subject.
Transactions on the blockchain are done exactly like this. Once a piece of information is put onto the ledger it is authenticated completely to the point where even the most minute, unnoticeable, or insignificant change can indicate a forgery.
For example if I was to buy a certain object of value, that object of value would be written down on the blockchain and no matter how hard someone else tried to create forgery of that object, unless it was perfect down to the atomic level, it would never be authenticated as the original. Thus, nobody will ever be able to question the authenticity of the object, the owner, or the transaction date — everything would be publicly known and completely auditable.
Let’s take as another example our box of Lincoln logs. If we were to implement a blockchain and blockchain technology into the manufacturing and sale of each box, we could track the specific box (and every piece in the box) from the time it was created, to the time I bought it and all the steps in between. By writing this on distributed ledgers there would be no question as to its originality, where it was made and how it has arrived in my possession. Thus my Lincoln logs could be validated all along the supply chain and everyone would be able to tell that it is original and not replaced or fake.
The ability to track these steps along the way takes out the need to trust that a merchant is actually selling an original game and not a forgery. This would also allow me to ensure the purchase I’m making is between me and the merchant I think I’m buying from. While someone along the way may be able to corrupt a single copy of the ledger, the entirety of it is not controlled by any one person and, as such, no matter how hard someone tries, I can always track down and authenticate the original.
Along with the generic storage of distributed information, the blockchain can also facilitate the execution of smart contracts. Imagine a regular contract in which two people sign a piece of paper and if any dispute occurs they bring their signed piece to a judge and say ‘Look! They signed it, it’s enforceable!’ Although in many cases a signature on a contract provides all the authentication necessary, contract/signature forgery are massive legal issues that cause immense amounts of legal and monetary damages each year.
The aspect of trust, which is built into the very nature of contracts, allows for fraud to take place. The issues, which may seem innate, are rendered moot through a smart contract. Written in an ‘if, then’ format, smart contracts are binding contracts that are fully auditable on the blockchain only execute after certain conditions are met. As such, the transfer of services, assets, money, or any other function of a contract is fully auditable and executed sans any trust or human action (which is always subject to misguidance or mistake). As an example, let’s say I was trying to buy a box of Lincoln logs from across the country.
Instead of just paying and ‘trusting’ that the logs will get to my house, through the implementation and use of smart contracts, I am able to monitor each step the logs take — from manufacturing to delivery — and stop the transaction at any time if something goes wrong. Furthermore, the company I buy from is also able to monitor the transaction to ensure order and payment fulfillment.
Through trustless business transactions, auditable authentication, and absolutely no ability for data loss or compromise, the blockchain could revolutionize countless industries including finance, health services, insurance, and real estate.
Furthermore, on the consumer side, blockchain technology would allow us to ensure the authenticity and ethical supply-chains of the goods and services we value the most. In addition, as the cost of goods lowers through a lack of ‘guess-work’ in authentication and supply-chain monitoring, consumer goods and services would also lower in price.
As we move toward a new, trustless, world the blockchain holds massive potential for us all — all we have to do is build our societal structure up, one Lincoln log at a time.
