Blockchain. The word is everywhere these days, and the technology is soon going to be everywhere as well. Fortunately, however opaque and complex the technology may seem, it’s really a relatively simple concept. This is a Beginner’s Guide to Blockchain so you can understand the basics, and begin seeing it’s unique potential as a real game-changer in our world.
The Blockchain is a public ledger recording digital transactions or events. Rather than belonging to any one person, company, or government, it’s shared by many individuals. Transactions are only recorded by consensus from the majority of users, and can never be deleted. Complete strangers can execute complex transactions transparently but with assured privacy, never exposing confidential information. Blockchain places faith and power in the interaction of the many rather than the whims of the few. This is a decentralized, crowd-sourced spreadsheet using cryptography rather than centralized authority.
Whether your instinct is to welcome blockchain for its potential to shift financial power dynamics, or to vilify it for bringing anarchy, you need to understand it. The math underlying Satoshi Nakamoto’s blockchain, as created to support Bitcoin, is a solution to a famous game theory conundrum called the Byzantine General’s Problem. In this puzzle, army officers are organizing an attack while concerned about possible traitors. The goal is to find a way to pass along a message that can’t be sabotaged.
Blockchain solves the problem. Every transaction on the blockchain is sent to many nodes on the network. Everyone participating gets a copy, and the order is verified through cryptographic processes that draws on the computational power of the entire crowd. Members of the community have the incentive to verify transactions because they get paid in Bitcoin to do so.
The future is in front of us and needs to be leveraged now, because Blockchain has the potential to be the largest source of innovation since the internet. We’re extremely excited about its potential here, and that is why we’re working so hard to uncover the true potential of the Blockchain.