WHAT EXACTLY IS BLOCKCHAIN?

In very plain terms, a blockchain is a distributed ledger of information hosted atop a self-sufficient and dynamic network of users (nodes). While this simple architecture sounds a bit rudimental (distributed ledger are not novel technologies), the way a blockchain handles the information stored on its network is what makes revolutionary

Blockchain leverages three core technologies; cryptography, digital signatures and Peer to peer (P2P) networks to retrieve and organize data sets efficiently.

By virtue of this, it creates a seamless and more importantly tamper-proof system of handling information.

The traditional protocol of information handling for today’s digital world is the client-server architecture. Your favorite tech giants (Facebook, Twitter, PayPal) and virtually every other entity hosting data for user access on the internet use this framework. Here, when a client (user) requests for a specific resource associated with a network, it is retrieved from a central database and depending on the network’s privilege settings, delivered to the user.

The central database is conversely hosted on central servers, which are run and maintained by the parent organization.

This system does come with its attendant benefits. However, a case can be made that it is inefficient on several fronts - cue efficient P2P networks.

Traditional client-server architectures typically rely on central servers for functioning. P2P networks like their names subtly let out are, on the other hand, run and managed by users of the network itself. These user computers are tagged ‘peers,’ and on the network, each peer with equal rights is regarded as a node.

Practically nodes can be any electronic device, the only requirement being that it should have a valid IP address and remain connected to the network (either via the internet, or local networks) on which the blockchain framework is hosted.

Think of nodes as the functional unit of a blockchain organized in a defined structural framework called a binary tree.

Together nodes in a binary tree integrate to form a composite computing network where specific rules segregate computing tasks to individual users who then execute these tasks as part of the higher functioning of the network. Data associated with the network is shared and stored amongst all constituting members.

Despite being tagged as equal, nodes typically perform different functions on a blockchain network, some of which require more computing power or privileges than the other.

As an example, full nodes run a full copy of the associated blockchain network at all times, whereas a lightweight client typically runs shortened versions of a network.

Both are however confined to implementing the same network consensus – the system of rules guiding how transactions and contracts should be executed on a blockchain.