Blockchain. What the heck is it?

Blockchain is a software infrastructure that hosts data like databases and provides compute power like cloud environments such as Google Cloud and AWS. It will revolutionize technology as we know it and when it is mature enough the transition into it will happen fast.

This article represents my personal opinion about blockchain, decentralized networks and cryptocurrency and it is aimed to help people to understand what it is and how it will affect their lives in the short term.

Disclaimer: I'm not a financial adviser and this article should not be used as a reference or a guide to anyone. You are responsible for your own investment decisions.

Author:?https://www.dhirubhai.net/in/thalesjacobi/

Date First Published:?30/DEC/2022.

What is Blockchain?

Blockchain is a chain of blocks.

It sounds obvious but it bears the question, what are blocks? Blocks are pieces of information grouped together. Imagine you have a spreadsheet in front of you and that it is 1000 lines long. Now imagine that you have grouped this same spreadsheet into five blocks of 200 lines. Done, you can now imagine what a blockchain is: a chain of blocks of information that can be put together at any time.

Creating blocks

Let's keep the idea of a spreadsheet that now we will need to split into blocks, how do we create these blocks?

Imagine you have one new line of data in your spreadsheet being created every minute. This means you will have to write a piece of code that will count each new line and when the counter hits the number 200 your code will group them into

Joining Blocks Together

You will need to consider how you will make the blocks link together so they are not organized in different ways, without a sequence. It is important to keep the blocks linked in the correct order and blockchain is a technology that solves this problem with a clever mathematical formula.

If you a math professor you might want to take a look at that formula, if you are not, like me, all you need to know is that once a block is made, nothing can be changed afterwards which makes it impossible to change or delete information.

Perennial Data

The way blockchain works we will want to store data that we don't want to see changed, like financial transactions. Bitcoin was the first truly blockchain solution and it made a bit of information to be perennial inside the internet, stored and protected by miners.

Ethereum identified a way to replicate Bitcoin's blockchain and to improve on it by making it possible to use it in other parts of life. Now we can store not only financials but also birth certificates, property ownership and insurance policies using a feature called the Smartcontracts configured with the language Solidity, a simpler version of Javascript.

The Birth of Tokens

If you create a smartcontract and put together a solution for insurance companies to run their operation with blockchain, you could be creating a token. Tokens are the payment for miners to run a mining node of Ethereum and guarantee the information is perennial and immutable.

This trend is called "Tokenization" and it is what many companies are working with nowadays. Some say it is the new revolution like the internet was in the 90s and that is why it is called the Web3.

So, What is Blockchain?

It is a chain of blocks that created the new internet!

I have been particularly interested in one part of the tokenization world: file storage. I know it is not as sexy as financial technology or property registration tokens, but I feel it is exciting to see that something so fundamental for IT (such as file storage) is now being changed by this thing that builds chains of blocks.

Use Case: File Storage

There are companies raising millions to build a blockchain-based solution to store files, and I will write an article about that in the future, but for the purpose of this article what matters is that now we can not only store money transactions, properties and birth certificates, we can store a file as well, any file.

This new way of running a blockchain makes data become mutable and that can be deleted, which opens up for a whole new world of possibilities... such as storing videos and other types of data.

Imagine you store thousands of videos, documents and images without owning any servers, databases or file storage hard drives. There are miners all over the world that will receive tokens that you deposit and in exchange will keep your files there, all encrypted and split is a hundred pieces so no one can lose them. It is safe, secure, and retrievable anywhere in the world where there is internet available and it is super, SUPER, cheap... 10 times cheaper than the cheapest option we have today like Dropbox, Google Cloud, Azure or AWS.

What is Chain?

Now we know what a block is and how they are connected together, what is behind this Chain?

The chain is a software you download to a computer that connects via the internet to other computers with the same software. This forms something called Distributed Network or Decentralized Network where computers share the same information.

This type of network is not new, it exists for almost 30 years (which is the equivalent of 1000 human years) and it has been used by NASA in the past to process millions of pieces of information at the same time demanding a computational power that they didn't have.

With a decentralized network and the power of encrypting data joined together in blocks connected to each other like a chain show the whole picture of what blockchain is, but this is only the beginning of your journey towards understanding what it can do for our society.

The End

I hope this article has helped you to move along in your journey towards understanding this new technology and if you have any questions or suggestions, I can add them here to this text to make it more and more valuable over time.

Xxx.