Learning Crypto: What is a Blockchain?

in blockchain •  last month

Screen Shot 2017-10-18 at 6_Fotor.jpg

This is another installment of Learning Crypto.

Today I want to explain the basics of a blockchain and what is required to make it work. So first, let’s explore how the idea of a blockchain came into existence.

Satoshi Nakamoto, the anonymous creator of Bitcoin, is who we should also thank for the invention of the blockchain.

The blockchain was created as the means to accomplish peer-to-peer value transfer that provides a way to ensure that each bitcoin is legitimate and each transaction is verified and cannot be double spent.
A blockchain is basically a group of transactions that have been verified by the distributed network and are organized into what are called blocks. Once these blocks are filled, they are then verified and added to the chain. They essentially lock in the blocks that preceded them.

It is in this way that a blockchain forms a public ledger where these transactions can be viewed. This also makes it difficult to alter these transactions in a way that allows shady players to falsify transactions for their benefit.
It’s important to note that although these transactions themselves are public, the individuals who participated in the transactions, their addresses are kept somewhat anonymous.

For the sake of keeping things clear, this video will be focusing on the Bitcoin Blockchain.

In order for the blockchain to function, there needs to be some key actors called nodes and miners.

The network is what organizes these transactions into the blocks and verifies that the transactions are legitimate.
These are the jobs filled by what are called Nodes and Miners.

  • Miners have a couple different roles in the Bitcoin blockchain. They create new bitcoins by running a specific computer program that after time unlocks a certain amount of Bitcoin that is awarded to them. They also are the ones responsible for creating the blocks of the blockchain.

They organize transactions into these blocks and send these blocks to what are called Nodes to be verified. If their block is selected to be put in the blockchain they are rewarded with what are called block rewards in addition to a percentage of the transaction fees paid by those conducting the transactions.

  • Nodes are responsible for more or less monitoring the entire blockchain and ensuring that fraudulent transactions can not occur.

It is the distribution of these nodes that ensures the entire network cannot be manipulated by individuals who wish to create fake transactions for their own monetary benefit. A benefit for being a node for the Bitcoin blockchain, in addition to further securing the network, is that it gives you complete control of your investment in Bitcoin. The downside to being a node is that you are required to download the entire Bitcoin blockchain, this takes up a lot of space and time.

Just because the idea of a blockchain began as a way to establish true peer to peer value transfer does not mean this new type of technology is limited to just that.

This technology can be applied in ways that remove the time and cost of third party middlemen in different areas of business.

Additional Reading/Sources:

More on Miners
More on Nodes
Implications of the Blockchain
Great Blockchain Infographic

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Another great piece of education for the newbies at it!

Thanks a lot as it is reenforcing our platforms and the tidal wave of global consciousness to reach the epic proportions it needs to get to to flatten the centralized banking system. All for one and one for all! Namaste :)

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Good comment . what is namaste

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Thanks a lot, here's a few lines about "Namaste" with which I adhere as closely as can be. Taken from the urbandictionary.com site, here's a bit of an idea about it:

It is "an ancient Sanskrit greeting still in everyday use in India and especially on the trail in the Nepal Himalaya. Translated roughly, it means "I bow to the God within you", or "The Spirit within me salutes the Spirit in you" - a knowing that we are all made from the same One Divine Consciousness.

The more formal greeting Sanskrit Namascar pronounced NAH-mah-scar is also used in India, though less frequently in Nepal. The Hindi "Jai Bhagwan" is also in common use, and carries the same meaning."

In other words, I bow in recognition of the light I am aware of existing within you as well.

Thanks for asking, namaste :)

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well, the artice is well crafted for people like me who is trying to understand bitcoin more or say cryto in generally, the writer really invested a whole lot of time to prepare this great article... i am loving it sha.

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I like this your comment. What is namaste

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Thanks a lot, here's a few lines about "Namaste", taken from the urbandictionary.com site and with which I adhere as closely as can be:

It is "an ancient Sanskrit greeting still in everyday use in India and especially on the trail in the Nepal Himalaya. Translated roughly, it means "I bow to the God within you", or "The Spirit within me salutes the Spirit in you" - a knowing that we are all made from the same One Divine Consciousness.

The more formal greeting Sanskrit Namascar pronounced NAH-mah-scar is also used in India, though less frequently in Nepal. The Hindi "Jai Bhagwan" is also in common use, and carries the same meaning."

In other words, I bow in recognition of the light I am aware of existing within you as well. Thanks for asking, namaste :)

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Wow, thanks for swift answer. You are special, just followed you.

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Thanks a bunch for the kind words and the fellowship. Namaste :)

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Yes. .Just to add... The greeting, when done in person,is combined with a gesture - a slight bow and hands pressed together, palms touching and fingers pointing upwards, thumbs close to the chest ! :-)

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Thanks for the addition, some may not know. Namaste :)

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My pleassure !

Namaste ! - from the person who live in India :-)

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I really love your content. As a fellow female traveler, it's rare to find women who know much about bitcoin let alone the tech behind it- blockchain. Thank you for the informative post. I think Blockchain acts as a fundamentally different form of security for peer to peer transfer essentially cutting out the need for a middleman: a truly and uniquely decentralized system that is safe and less expensive. Blockchain has the potential to fundamentally change the way we see transactions and security in the future and I'm so excited for this technology to take off with the masses in ways we can't even dream of right now!

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Let us continue to fight the good fight ;)

Great intro to the blockchain.

This is the kind of video that we need more of on Steemit. Short, clear explanations that are easily understandable and easily digestible.

While I know the basics of DLT and bitcoin, this vid contained certain info that I was unaware of. Also, the material was presented in a clear and interesting way, so I made sure to watch the entire vid.

Keep up the good work. Full Steem Ahead.

Sometimes a video is better than thousand pictures (in fact, video is collection of frames/pictures without audio). A picture is better than thousand words. Thanks @heiditravels explaining blcokchain in simple words and visual way.

Thank you for the great post! You are an inspiration for myself to get working on creating great content just like yours.

Great summary. Thanks for sharing.

I got nice learning about crypto...

Very useful. Thanks for sharing :)

Now I have a better understanding of Blockchain! This was easy to understand too

Good info - always nice to go back to the basics! Most of us aren't pros so it can't hurt.

Thanks for this info, from someone brand new. I have a lot to read up on, but this will help, as a great place to start!

Great post!
Every beginner in steemit or crypto period should become familiar with the blockchain.
Steem On :)

Wow, o learned new things here. Well done

Therefore the blockchain is the most secure and transparent documents. The government should use this technology if they really want and serious about the transparent governance.

Nice overview! All miners are nodes but not all nodes are miners. A node is just a computer that doesn't mine.

A wonderful post about blockchain. To be honest, I am new here and I've been reading a lot about sbd, blockchain, cryptocurrency, cryptic heads et al :D

And I was as clueless as one could be. Here is a blog post that puts things into perspective and thanks to you for that :)

Great overview @heiditravels
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teaching my mother...this is helpful thank you so much..bless up

I watched already a lot of your videos. And i appreciate that you sharing the basics with us. Everyone can learn about Crypto currency from your videos.
Keep on going the good work.

Great, quick article. Thanks! Helps to kind of spell it out!

teşekkürler!! Ama biz bitcoini nasıl alabiliriz ?

I still not understaning a blochchain and how can this system can generate moeny with nothing ? can you help @heiditravels
And thanks for this post it was very interesting

Wow nice post. hope to hear you soon some good stuff in cryptoworld..

Congratulations @heiditravels, this post is the second most rewarded post (based on pending payouts) in the last 12 hours written by a Superhero or Legend account holder (accounts hold greater than 100 Mega Vests). The total number of posts by Superhero and Legend account holders during this period was 27 and the total pending payments to posts in these categories was $1260.99. To see the full list of highest paid posts across all accounts categories, click here.

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Whats Block chain? can i buy it at Home Depot? whats the best chain to buy? also what size of a block are we talking about here? 2x2 blocks? I have a small Honda hatch back so i am limited to maybe 4 blocks total.

Very informative block chain info

very nice post

Great intro to the blockchain

Hi Steem I am the best upvoter So you will add me iam always upvote your all post

Interesting article
Thank you
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Actually one of the easier explanations to follow

Wow , amazing & interesting, Thank you so much for sharing .
Now i know more about blockchain technology .

Followed & upvoted !

Very Good , Intro !

Very insightful thanks for info

thanks for this post..
it was very very interesting///

thanks 4 the article

@heiditravels

Headed to Cryptolands and beyond!!

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Wishing you much continued success!!!

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Great overview...this is just a beginning,no one can stop growth of this technology

Informatif post thanks for sharing it.

Hy can you please check my vlog

great article , thanks for sharing

Helsotravels your post very nice good job !!!

Hi @heiditravels! Amazing video for us, the newbies! It's so important for us to have this kind of help!

Another killer video! Hows the surf looking out there?!

Interesting article as always!

Blockchain is probably going to democratize a lot of industries and like you said will take the unwanted middle men out of a lot of them.

Great post :)

Really informative and useful post my friend !
Thank you so much for your effort dear @heiditravels !!
Upvoted .

@heiditravels great post, great job, very interesting topic you are talking about, great job