What is Blockchain, the technology of the Chain of Blocks?

Blockchain: a technology that can change everything

This is the fundamental principle that supports Block chain o Blockchain, a technology that has the power to forever change our relationship with the digital world.

Consider, for example, a text file with two columns, where in one column it puts an identifier (for example "abc") and in the other a number (for example "34"). That is, "abc" corresponds to "34". Now imagine that this file could be duplicated on thousands of computers, with the certainty that no one can treacherously alter it, but when something legitimately needs to be altered, in a matter of seconds, everyone is synchronized. Even if one of the thousands of computers disappeared from the network, nothing would happen.

This is what Blockchain achieves and although its magic is much more complex and made up of more pieces such as cryptography, in essence that is what it seeks: a distributed ledger resistant to synchronization and without the need for trust between the members that make it up. Something that had been trying to solve for decades and in Bitcoin has been achieved by its creator, the unknown Satoshi Nakamoto.

En Marc Andreessen's words, Creator of Netscape and partner of one of the largest Silicon Valley Venture Capital funds:

A blockchain is essentially just a record, a digital event ledger that is "distributed" or shared among many different parties. It can only be updated based on the consensus of the majority of participants in the system and, once entered, the information can never be deleted. The Bitcoin blockchain contains an accurate and verifiable record of all the transactions that have been made in its history.

Explaining the parable of the Flying Meerkat

In the previous analogy, the unbelieving individuals who agree to explain what they have seen, become nodes. (later you will see the role they play in detail) geographically and computationally isolated from each other.

The "lie detector" is taught a “Proof of work”That is, a cryptographic process that proves that one computer / chip and not another has correctly solved a problem.

Forging a blockchain entry would be tantamount to getting more than half of the people to agree to lie about the details of the meerkat landing in the same way, all at the same time and without being able to coordinate that. lie previously.

In other words, a complicated “attack” to carry out.

What is embodied in the blockchain can never disappear. Blockchain is an immutable and permanent record. It is a database that only allows writing. You can not modify or delete any of it and always, under consensus.

Do you realize the relevance of this?

Think for a moment that every interaction that takes place online today is backed by a central authority that we trust.

It doesn't matter what you do since you're always trusting that someone is telling you the truth, whether it's the bank showing you the balance of your accounts, WhatsApp telling you that your message has been sent or your antivirus saying that everything is fine on your computer.

In fact, there is always the risk that some information provider is lying to you or is simply wrong. That is why Internet security is nowadays a mess in which Virtually all services can be hacked, tampered with or compromised. And we trust them with more and more personal information.

Bitcoin is digital money, but when we think of digital things we think of files that can be copied and pasted, like your vacation photos, a song, or any other file you have on your computer. That is why there is the blockchain, the ledger. There are no bitcoins, there are no files that represent bitcoins, just an accounting book that manages to keep track of the entire financial system in an incredible way.

For the first time in history, a book is being written collaboratively by thousands of parties. Think of any great book, for example the Bible for Christians or any other, written collaboratively, by consensus, without informational dictators saying what to put and what not. Imagine how good a planet that transparent would be.

What does the blockchain or blockchain have to say about it?

It sounds incredible but thanks to the concept of distributed consensus an incorruptible record of past and present events of the digital world can be created. Also, it would do this without compromising your privacy.

It can be recorded that the event in question has taken place and that it has succeeded without specifying specific details about the type of event or the parties involved.

This explains why bitcoin has been used to carry out illegal transactions since, despite public and free access to the “ledger”, the privacy of its users is guaranteed if required.

Typical misunderstandings about blockchain

Bitcoin is a decentralized network

It is not true.

The blockchain is a P2P network in which all the nodes are equal to each other resulting in a distributed system resistant to computer attacks, failures or falsifications. In this way, even if a node failed, it would be possible to reach those to which it was connected by alternative routes. This would not be possible in a decentralized system.

Blockchain and Blockchain.com is the same

It is a misinterpretation often made by those new to bitcoin. As we have seen, the Blockchain o Blockchain is the powerful technology that brings life to Bitcoin.

Blockchain.com is a service that allows you to observe everything that is happening in the bitcoin network, such as updated graphics in real time that inform about the status of the cryptocurrency, the transactions that are taking place or detailed information about each operation and block mined.

Blockchain potential

If you have come this far, you will have already realized the enormous potential that this technology harbors, so much so that numerous personalities from the technological and financial sector have placed bitcoin and the chain of blocks at the level of the personal computer industry in 1975 and the Internet in 1993.

One of its most relevant emerging applications has to do with what is known as "smart contracts" or smart contracts.

They consist of the ability to trust a distributed network to confirm that a contract of any kind has been fulfilled without revealing any type of confidential information about the parties and / or the nature of the transaction.

This would serve, for example, to release a payment to a . that you have subcontracted when their work is finished or so that your washing machine can buy detergent by itself once it detects that it is finished.

The implications of this in relation to trust and transparency when making transactions of any kind are simply enormous.

Four sectors that the blockchain revolutionizes

In theory, all this looks very good, but is there a company that has already started to work to unleash the power of Blockchain?

Of course the financial sector, which is what it was designed for, but it is not the only thing. Here are three examples:

Distributed cloud storage

Cloud storage services like Dropbox or Google Drive are centralized and by using them you are trusting that a single provider will "respond" to the data you store on it.

Storj is a startup that is beta testing a service that allows this to be done in a distributed way using a network based on Blockchain to increase security and make the service less dependent.

Its users will also be able to rent the space they do not use to others, just as Airbnb does with accommodation.

Patents/Property Registration

One of the first non-financial services that has been given to the blockchain is the inclusion of encrypted information within transactions.

In this way, an impossible to replicate hash can be created that is associated with a single document stored outside the blockchain.

Think about the implication that this has for the registration of patents or intellectual protection.

A company like Google, for example, could prove that it has created a technology on a specific date without the need to make a formal application to register the patent.

You could link those internal documents to the hash of a transaction made at that time and thus prove that they were the first to develop it. Services like Proof Of Existence allow you to do this.

Electronic vote

As you can imagine, the cost of creating ballots, organizing all the necessary infrastructure to manage the vote and the subsequent counting is very high.

Electronic voting systems have already been tested, but they have been unable to withstand hacker attacks and have failed to count accurately.

The Blockchain can solve it since it would allow a voting system in which the identities of the voters were protected. It would be unfeasible (a hacker would need more computing power than the 500 most powerful supercomputers combined, 256 times) at virtually zero cost and public access.

This system could end the shadow of "pout" that flies over every election. Especially in countries where corruption is the order of the day.

transparent government

With blockchain technology, any city or government could reflect the status of their accounts in real time.

With a network like Bitcoin or Ethereum, a council or government should only indicate which address they manage. From that moment we could all see the status of the accounts, what goes in and what goes out: down to the last cent, in real time and at a very low cost.

If at any given time there is a payment that goes to an address that cannot be justified with an invoice, the auditors and the entire population would see it instantly. Also, let's remember that blockchain is a chain, so something cannot be put into it afterwards to try to falsify the accounts of the past.

Imagine this in a city hall, institution, or the government itself (and how it could help fight corruption at all levels).

Of course, this from the hand of those who manage democracies as if they were dictatorships, will not come out. So, despite the technological capacity to be implemented tomorrow, we have a long way to go.

What are banks doing about it with the blockchain?

The financial sector has finally detected the potential disruptor that this technology will have in your industry. In fact, almost daily there are new investments in this sector. In just one month this section could be out of date in terms of references.

In fact, BBVA with Coinbase, Bankinter with Coinffeine y Santander These are some examples of Spanish banking giants, who have bet in the form of investments to better understand Bitcoin and the role it is playing in the present and, above all, the one who will play in the future.

We also see how one of the main Estonian banks is developing a wallet that uses Bitcoin to allow free and instant money transfers.

We can think even further by putting medical records, voting, property records, marriage records, or blockchain-managed litigation on the table.

Eventually, any dataset and digital transaction could leave its "fingerprint." Creating an easily auditable trail of every digital event that takes place in history without compromising anyone's privacy.

Conclusion

It seems evident that if the blockchain as a concept survives the enormous expectation it is causing, it could introduce a level of democracy and objectivity in the digital world hitherto unheard of and unattainable in the "physical world".

The promise he makes to us carries with it a future in which no one has absolute power online and no one can lie about past or present events.

In addition, remembering the initial example of a text document with two columns, where "abc" corresponds to "34"; You should note that it has not been indicated at any time what those "34" are. This is because Blockchain is actually agnostic, it serves to keep track of things. Then, depending on the case, the "surname" or connotation that is desired or that each ecosystem deems appropriate will be associated with it. In this line, in the Bitcoin ecosystem the blockchain transports bitcoins, which are priced based on a quote that people give it. But this accounting could be used for countless things: company shares, local currencies, home ownership, diamond tags, identities… The potential is only limited by the imagination. After all, Blockchain is a distributed ledger that allows value to be transported.

Today there are hundreds of projects that, inspired by the idea of ​​decentralization, are investigating how to extrapolate this principle to other things. Many times using even Bitcoin's open and free source code, the first ecosystem to put the pieces together in a functional way on that ideal.

Don't forget that Bitcoin is constantly evolving and at the same time Blockchain technology. It is such a dynamic sector that new solutions, integrations and innovations appear every week that continue to take this technology to new levels.

Do you think it will be able to fulfill the mission of taking us to a more transparent and fair world?