What is Blockchain? And What’s in it for You?

I am sure you might have heard about it or have some knowledge about it by now, if not then well, now you have heard about it. In this article, I aim to explain to you what is blockchain and why you should know about it.

In order to understand something, it’s important to know the history. So once upon a time…ahhhhh! No, let’s not deep dive into it now. Below is the list of milestones (or checkpoints) to note the rise of blockchain.

1991

  • A cryptographically secured chain of blocks is described for the first time by Stuart Haber and W Scott Stornetta

1998

  • Computer scientist Nick Szabo works on ‘bit gold’, a decentralized digital currency

2000

  • Stefan Konst publishes his theory of cryptographically secured chains, plus ideas for implementation

2008

  • Developer(s) working under the pseudonym Satoshi Nakamoto released a white paper establishing the model for a blockchain

2009

  • Nakamoto implements the first blockchain as the public ledger for transactions made using bitcoin

2014

  • Blockchain 2.0 is born, referring to applications beyond currency. The Ethereum blockchain system introduced

2016

  • IBM announces a blockchain strategy for cloud-based solutions. Countries recognizing the legitimacy of blockchain and cryptocurrency

2020

  • Facebook commits to start a blockchain group. Bitcoin almost reaches $30,000 and continues to grow

What exactly is Blockchain?

Blockchain in simple terms can be understood as a chain of blocks that can carry certain information. Depending on the use case and application, the information can vary. A single block consists of three entities:

  1. Transaction data(Information)
  2. Nonce- A 32-bit whole number that generates a unique Hash for a block
  3. Reference of previous block’s hash

To create a block, one needs to solve the complex math problem of finding the nonce that can generate the acceptable hash, which is not so easy. Once the accepted hash is generated after a lot of computations and efforts, the data is signed in the block and it gets connected to the chain. The person which does this is called as miner. In order to make a change in a block, it not only requires to re-mine one block but also all the previous blocks which are linked to it, and hence it’s nearly impossible to manipulate blockchain technology.

Nodes

Once a block is mined, it is then verified by the nodes in the network. Nodes are nothing but pools of blocks. So as the system is de-centralized, every node has its own copy of the blockchain and no one system would have control over it instead, there is a Distributed Ledger that logs all the actions happening between the blocks which thereby makes the system transparent. The diagram below can help us in understanding this with an example

images (1).png

Credit:ledger.com

Ideology

The core reasons this technology and underlying applications are being recognized are:

  1. Promising more Secure and scalable systems which are revolutionizing the IT industry.
  2. Decentralized Approach- There will be no control of central authority over the system, instead it will be managed/validated by every node in the network.
  3. Ample of use cases and projects with the basic principle of blockchain in its core, a few of which are Cryptocurrencies, Smart contracts, Safer transactions, and NFT Marketplaces.
  4. Open Source- Almost all the prominent projects are available to the public and they can contribute to the same.

Impact on Developers community

This rise and Significant features are encouraging developers and engineers to experiment and create systems on the blockchain. The impact is huge as it has a lot more potential than just cryptocurrencies.

PicsArt_05-13-02.54.29.jpg

source: LinkedIn (2020)

I hope we now have basic knowledge of blockchain but it would be more clear if we could see all of this in working right? Let’s not worry, cause I have it covered😎

A Simple Blockchain Using JavaScript

We can start small and try to understand and build a simple blockchain. Check out how I made a blockchain with JavaScript here.

I would be happy to read your thoughts on this and if you have any feedback /references, you can mention them in the comments belove. Thank you so much for your time. 🙂

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Jay Bhanushali

Jay Bhanushali

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Venturing life, one bit at a time . I love to travel, read and write code