The basics of what the Blockchain is, and why everyone should be learning it are pretty elementary, but let’s discuss the more advanced concepts first. If you’re not familiar with what a Blockchain is, it’s actually quite simple to understand. Basically, a “blockchain” is simply a ledger that is accessible and reliable over the Internet. This ledger system, when used like a phone book or a business directory, allows people to look up any information they want to know about a specific transaction or a series of transactions over the last couple years. The nice thing about a “blockchain” is that anyone can contribute to it and make improvements to it, and it’s completely customizable by anyone who wishes to do so.
Just how does the Blockchain work anyway? Well, a typical “blockchain” is a collection of various computer networks working together. Each computer in the network participates in validating and recording all of the different trades that have taken place over time on the system. Anyone can start a new entry at any point in time, and since all of the computers in the network are using the same copy of the ledger (which is known as the main server), all transactions are transparent and accessible to the public. There’s even less to it than that, but we’ll save that for another time.
The next topic we’re going to cover in an in-depthICO tutorial is how everything gets updated and maintained. Let’s start by explaining the way in which the ledger gets updated and maintained, starting with the main server. The main server serves as the center of all activity on the ledger. When anyone adds information, updates data, or even writes a new transaction, the change is applied to the main server and made available to all other nodes on the network. Every single transaction is stored on every single node, and each node is connected to every other node in the network, hence the redundancy.
But how do other nodes get updated? You guessed it – each node copies the changes it receives from the main server to its own computer. And since every computer stores copies of all relevant data, this procedure is called copy-writing. In this way, every node on the network gets updated whenever necessary. And the entire process, from receiving an update to making changes, is called propagation.
As you can see, this is just the first part of the story. After the hardworking parts, the next topic in the series is what Blockchain explained in a simpler form. Since each computer has its very own copy of the ledger, updates would be replicated across every machine, or at least every machine with access to the Internet. It may seem complicated at first, but once you understand how the network works, you’ll realize that it is indeed very simple, and it will make you think of businesses in a very new way.
One example of a very simple protocol is the “Blockschain”. The Blockchain simplifies transactions between participants in the network by replacing the traditional block with a ledger. When a transaction happens, a special key is used together with some information about the transaction, called the public key, by anyone who needs to view that data. Anyone who wants to do a transaction, he just needs to provide the correct public key. Once that person finishes doing so, a copy of the ledger and the original document containing all the relevant data will be kept by him, called a “block”.
In contrast with the traditional computer models, the Bitcoin and the Blockwork explained above use a radically different approach, called “proof of work” instead of a traditional proof of ownership. As soon as someone contributes new blocks to the ledger, his or her private key is recorded in the ledger along with the date of the contribution, which is also called the hash of the transaction. Every time someone tries to add a new block to the ledger, his or her own key is added in place of the previous block.
This is a complex system, but it is very simple to understand. People who are unfamiliar with the workings of the Internet might not be able to understand this explanation, but if they try to read between the lines, they will understand what is happening. The fact that it is decentralized doesn’t mean that everything is smooth sailing, though. Some people don’t like the fact that everything is decentralized and feel like they got taken advantage of in this case.