What is a blockchain?

Updated: Aug 8, 2021

Briefly, blockchain is a data chain.

Blockchain is a technology and a revolutionary idea behind Bitcoin. We must mention Bitcoin when talking about blockchain, because this development was explained in the white paper that proposes the cryptocurrency itself. This white paper -a paper explaining how a new kind of economic transactions without the involvement of intermediaries is possible- lays the foundations of blockchain.

To explain in detail what a blockchain is, the easiest way is to break its name: BLOCK + CHAIN

Block: it’s a block because each transaction is a unique block of information. The information is not corruptible, because of its constant validation. This validation eliminates the risk of double spending the same coin. All the information is stored as a hash, a technology that allows to encapsulate information in a unique encrypted alphanumeric code.

Chain: this block is also a chain, because contains the history of all previous transactions inside it. If you would like to change one transaction, it will be necessary to change all the blockchain - all the transactions that leads to that particular one, because they are all connected.

An interesting characteristic about blockchain is that is open to the public. This was the first revolution: to perform transactions in a secure way, between individuals that don’t know nor trust each other, without the involvement of an intermediary (a.k.a. banks and other financial institutions).

After some search, we found the Ethereum blockchain (link in their developer’s space) Because the blockchain is public, if you have enough programming skills, you could access the information throughout the different descriptive fields. You could become a validator. You could as well use their source code as a base to create a new cryptocurrency.

If you would like to see the Ethereum blockchain, Etherchain link is here.

What it’s surprising about this blockchain is its size. As of today (18/04/2021), is less than 225 GB. Keep in mind that Ethereum is the second largest cryptocurrency, only behind Bitcoin, and all its transactions and coins are stored in a blockchain with a size smaller that an external hard-drive. How can they do this? Because the information is stored using the hash technology we mentioned earlier.

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