Blockchain & Cryptocurrency - An Illustrated Introduction

in blockchain •  7 months ago

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@sndbox toolkit posts are designed to help cryptocurrency newcomers get acquainted with the ins and outs of Steemit and the blockchain ecosystem. If you have requests on components or systems related to Steemit that you would like to see explained, please let us know in the comments below.

What is Cryptocurrency?


Cryptocurrency is a digital currency that is created, held and distributed through an online network. (Also called virtual currency, digital money or tokens.)

  • The word crypto is derived from “cryptography” which is the practice of secure communication. Cryptography is all around us. It’s an artful form of code-making embedded throughout history, anywhere from WWII's infamous Enigma Machine to secure website browsing of today.

What is Blockchain?


Blockchain is a technology. It's a new infrastructure for data and the backbone for digital currencies like Bitcoin and STEEM. Instead of having a central server where all of your information is held and must pass through, the Blockchain allows for multiple “centers” to distribute and validate incoming information simultaneously. It's a smart and secure mechanism (not just for digital currencies) but also for big-scale community problem-solving.

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Building a Block


So what exactly is Blockchain and what does it look like? To better understand how this smart network grows, first we need to know how it’s put together. Before a “Block” becomes added to the “Chain” it must first receive four essential bits of information:

170917_Blockchain Slides [Recovered]-01.png

  1. Identification : An ID code or what’s called a “Hash”
  2. Timeline : The Hash number from the previous block, organized chronologically
  3. Transactions : All transfers between a sender and receiver
  4. Public Key : Identifies both a sender and a receiver

170917_Blockchain Slides [Recovered]-08.png

Assembling the Chain


The “Chain” itself is like a super intelligent ledger. What’s a ledger? Think of a library book. A ledger is the little yellow piece of paper tucked behind the back cover. This regimented paper is a recorded list of people who have borrowed the book in the past. It’s a timeline that logs the due date for the book to be returned alongside the name of the person who borrowed the book. In this example - the more book-readers there are, the better validated and secure the chain of information becomes.

170917_Blockchain Slides [Recovered]-07.png

So, who puts all this together?


Chains are built by a network of super computers all over the globe. Collectively, they curate the growth of a blockchain, individually, they are called “peers” (also nodes or witnesses or miners depending on the type of blockchain that they operate on).

For the STEEM blockchain - these network-builders are called “witnesses”. STEEM Witnesses are voted on by the entire Steemit community. These individuals make their case for being elected and are trusted members of the community. (Curious to learn more? Click here.)

Faster, Stronger, Collectively Independent.


With this new infrastructure for data - worldwide information can be held more securely, cost less, and be distributed way more efficiently. In a global economy that relies on a growing brain of data everyday; Blockchain is proving to be one of the most disruptive technologies in the internet era. With future posts, we'll speak to the many ways that this burgeoning ecosystem is transforming industries and practices and propelling the world wide web into the 21st century.


Thank you for reading! For any suggestions on potential tutorials or resources, please let us know in the comments below. Be sure to follow us for all of our daily posts and weekly newsletter.


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Excellent little piece of information I'm sure will be helping many new comers to this realm of crypto-currency magic of the BlockChain Technology! Powerful words you used here, "Faster, Stronger, Collectively Independent.", I like it!

All for one and one for all! Namaste :)

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Many thanks @eric-boucher! Always a fan of your kind words and helpful feedback :)

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It is my pleasure really, all for one and one for all!

Namaste :)

Great explaination

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Thank you @uxair! Glad you found it helpful.

I really love this sndbox style illustrations !

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Hey thanks @steeminator3000! We like your style too ;)

Much needed breakdown. Thanks boys

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Glad you dig it!

Fabulous one!!!
thanks for a sharing..

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Thank you!

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welcome...

Fantastic post, brief and informative. Big fan of your collective.

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Thanks so much @papan8! Brief and informative is the name of the game with complex stuff like blockchain. Glad you are finding our posts helpful!

Nice visuals. Thanks

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Thanks for the support @masterofcoin :)

Great illustrations! That is key for communicating these ideas I believe.

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Thanks! Simple clean illustrations are so key. Even these may be too complex. We're going to constantly revise and reduce them. It helps us all explain just a little bit better :)

I always respect your ideas about this platform....

Thank you very for the info
Keep it up

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You got a great and simplified explanation there. Bravo.

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Short, sweet and to the point. That's our goal! :)

woah this post is amazing! i so wish i had found this information months ago.. ive tried to understand so many times how this wonderful world of blockchain and crypto currency works.. this has really helped me , great work

Great post. Really good explanation for everyone who wants to approach the topic of crypto. Like always great illustrations. Nice work. Keep on. Upvoted and resteemed. Cheers.

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Many thanks for the kind words and support @arrkiin! We hope this blog post can serve as a baseline for those interested in the very basics of blockchain and crypto.

Excellent post!!!

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wow nice post I really like it I always follow your cool post

https://steemit.com/life/@abdulbarry/life-only-range-story-2017919t13637823z

This is awesome! Re-steemed!!

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Thanks for the support :)

Tthank you for your explanationion.

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Thanks so much for reading @blockchainnerd!

Noob cat says Thank you, Sir! I'm currenly learning How To Human and I will Follow you because I like how you explain things. Have a paw in exchange:15.jpg

This is a great idea, the idea of a vertical graphic to explain bitcoin will go a long way for quick reference to new Bitcoin users, it's really time for us to spread the word to as many people as possible.

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Thanks! And absolutely, simple clean graphics can go a long way to spread the knowledge base of Bitcoin (and STEEM) outwards. It's complex stuff, but it can all be broken down into something relatable and digestible.

What software do you use for the illustrations? They are great!

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Adobe Illustrator ;) always! Thanks @kondor1030

I love it when someone takes the time to create content to help others new to technology and communities. It only goes to help us all grow. Thanks @sndbox

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We couldn't agree more @gsargeant12! This is the key to help the community as a whole grow and move forward. Thanks for the kind words :)

The way blockchain works is subtle to understand. However your attempt to illustrate the concept behind it seems to be good

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There's a lot of complexity there but it all really boils down to some simple principles that anyone can digest. Thanks @alketcecaj!

upvoted my friend because

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Is this an invisible blockchain jump rope??

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Excellent brief explanation with beautiful graphic designs, as always ;)

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Very kind of you to say @aleister, thank you!

Wow, great info for someone like me. Been learning all I can about crypto, and must say this answer a lot of questions thx.

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Absolutely, glad you found it useful! Be sure to check out our other posts, we do weekly toolkits like this one that help break down complex topics for newcomers :)

I love your posts, always informative and very well crafted. I like your illustrations / artwork ;-) keep up the good work!

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Thanks for the support!

I like the way you made the illustrations. So easy on the eyes and very beginner-friendly!

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That's how we like 'em =)

Finally some visuals to help non-coders and techies understand the way crypto currencies work and most importantly why they are the future! keep up the good work @sndbox . we need to understand these things, its imperative. also for people whose brains work with pics and visualizations, this post it the shiiit!

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actually helpful! Seems like you're the one I was looking for. The one who fills the geek gap. You don't know how lucky I am right now.

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Glad to be of help!

Great explanation. Even I have been with bitcoins and other cryptocurrencies since last three years but these terms were not too clear to me. Your visuals put a great amount of light on them.

Great explanations, especially for one who's new at it. Illustrations are very helpful. Good job!Thanks for sharing.

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Absolutely!

excellent reference, I solidified some aspects for me too actually! In addition to defining witnesses, I think it's worth defining "mining".Even though in retrospect it's not an essential term to understand, this concept confused me a lot initially and it came up often . Each time I looked it up the definitions had more concepts that I didn't understand either. I still only understand mining in a very basic and probably incomplete way. And "nodes"...this is a new one for me, how is it different from a witness?

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Thank you! That's a good one, we should do a post just on mining. And honestly, maybe begin compiling an illustrated glossary of terms. I believe nodes are witnesses. But will need to double (triple) check...

Also, we just did a post today on Witnesses that covers the uber basice but you might find useful - https://steemit.com/toolkit/@sndbox/what-is-a-steem-witness-introducing-the-basics

Thank you! This was very helpful for a newbie like me!

This post will change things around because of its insight, especially for me, nice post @sndbox

Thank you for this information. Commenting for me to go back to later.

That was a really good explanation, especially for newcomers like me. Thank you!

Thank you for that. :)

You can find Russian version of this post HERE

Ditto (people still use this word?), anyways I appreciate the quality of your work and just love the graphics. Its content like yours that will continue to demystify Block Chain technology and speed up the adoption by more people globally. Learning about this technology can be a bit overwhelming but when I come across excellent post like this...I start to connect the dots about the present and future of Block Chain technology. Keep moving it forward and Thanks!

I hope it isn't late. There is still no translation into Indonesian language, so I decided to make it one.
Here is the translation into Indonesian
Have a nice day @sndbox

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upvoted for visibility