Blockchain, the newest and most popular technology that everyone is currently raving about. What is it exactly?
'A blockchain is a distributed software network that functions both as a digital ledger and a mechanism enabling the secure transfer of assets without an intermediary.' -The Blockchain Research Institute
A lot of confusing words there, lets break it down to 'distributed software network', 'digital ledger', and 'secure transfer of assets'. First lets understand what a ledger is. A ledger is usually a log. A loan shark for example would have a personal ledger logging all the people that owe him money. In that same book they'll log those same transactions as either paid or late or whatever the case. It's a log of the history, the transactions, the numbers. In this case it would be a digital ledger probably keeping track of all the transactions happening.
That sounds like a pretty important thing right? A book with all the history and transactions in one place. What if whoever held that book were to make changes to that? Thats so unsecure.
That's where the power of blockchain comes in. The great thing about blockchain is that it runs on a 'distributed software network' or distributed system. What is a distributed system? A distributed system is a network of nodes that work together collectively. What are nodes? Nodes is just a fancy term for a machine that can connect to the network, it can be a computer, laptop, physical server, virtual machines, or other containers. Now through these network of nodes, the digital ledger is kept and stored on this distributed system. Each node has a piece of information of its own, and a copy of the information of the node next to it. Since our current node has a copy of the information of the node next to it, let's say that node next to it tries to change their information, we'd know right away because their information doesn't match up with what we have. Same goes for us and how the node next to us can keep us in check. Instead of a ledger being kept by one entity, we now have spread out the digital ledger amongst multiple nodes all keeping one another accountable. And that chain of nodes working together is the blockchain.
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