Blockchain: What Is It in Simple Words?

alien blockchain

The word “blockchain” has recently become very popular, many people have heard about it, but not everyone understands what it means. We will try to explain the following things in simple words within the framework of this article:

  • How blockchain works?
  • Why is this technology considered a miracle of the 21st century?
  • Where can it be applied?
  • What problems are still to be solved?

So, let’s discuss everything step-by-step.

Contents:
(please click the topic to scroll down to it)

  1. What is blockchain in simple words?
  2. What is the blockchain system and how does it work?
  3. Where can you apply the technology of blockchain?
  4. Pitfalls of blockchain
  5. Conclusion

 

1. What is blockchain in simple words?

Etymologically, a blockchain system is a clearly-sequenced chain of blocks constructed according to predetermined rules that contain certain information.

If we do not dive deep into cryptographic terms, then there is nothing complicated in the algorithm of the operation of the blockchain technology. For the sake of simplicity, the system of blockchain can be compared with the accounting journal, which is found in the possession of tens of thousands of users simultaneously. This journal is constantly updated and does this in all its copies, each page refers to the previous ones. In order to fool the system and fake at least one record, you will need a titanic amount of processing power, since you will have to replace all copies. Theoretically it is possible, but practically, one substitution will cost its organizers trillions of dollars, so we will consider it impossible.

2. What is the blockchain system and how does it work?

The blockchain platform is a large number of blocks that are constantly updated and linked. These blocks are distributed among all participants through peers (similar to torrent, which is used by millions of people to distribute and download files).

Each unit has its own individual hash sum. This is a timestamp, it can be compared with the biometric data of a person (retina, fingerprints, etc.). The blocks are connected with great precision into a certain chain. Attempts to change the sequence of blocks will not succeed. The system detects it immediately, because the hash sums will not correspond to the original registry. There are several methods of protection against such interference in the technology of blockchain:

  • PoW, Proof of Work.
  • PoS, Proof of Stake.

blockchain scheme

3. Where can you apply the technology of blockchain?

By and large, everything can be recorded in the blockchain.The scope of this technology is potentially much broader than just a payment network.There is a large number of blockchain projects, which are used in various spheres of life. For example, the UAE government decided to transfer 50% of the document circulation to blockchain until 2022. Using this technology, you can store any data. You can conduct voting, polls in blockchain. The issue of falsification disappears by itself.

Another unique feature, which was born together with Ethereum, is smart contracts. With their help, you can get rid of legal paperwork and intermediaries. There is a virtual notary (Stampery project) that certifies contracts through the technology of blockchain.

We already know of several working cases of how blockchain has been successfully applied in the field of copyright protection (the Ascribe project). If we start to list all the things which can benefit due to blockchain, we will have to write the third volume of “War and Peace.”

4. Pitfalls of blockchain

Like everything else in this world, blockchain has two sides of the coin. The first one, revolutionary and promising, has already been reviewed by us. It’s time to talk about the flaws and problems that are in the arsenal of this technology.

  • In order to implement the technology of blockchain everywhere, it is necessary to completely rebuild huge established systems that have a lot of interested parties, and they will hinder innovations in every way. You will need a couple of years to fully switch to blockchain.
  • This technology is not yet very friendly with regulators. In order for the broad masses to begin implementing it everywhere, the trust is required that is provided by the legislative framework. So far, there is no single scenario for solving this problem.
  • Miners use a lot of energy to confirm blockchain transactions. In the future, when the blockchain system is implemented in a large number of spheres, the powers to maintain it will have to be many times bigger.

5. Conclusion

The blockchain technology is unique and has a good technological support. It can store a large amount of data that can not be compromised, destroyed or replaced. The help of smart contract technology makes it possible for the agreements between two or more persons to happen without the presence of an intermediary, the algorithm itself will monitor the fulfillment of the obligations of all parties.

In the nearest future, blockchain has every chance to become a new paradigm for the mankind, but it is still necessary to do a lot of work and solve some problems to make it happen.

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John McAfee Will Shine the Light on Crypto

A crypto personality John McAfee took quite a serious position regarding his presidential campaign in 2020. He shared a couple of interesting details with his future electors

McAfee claimed that the main focus of his campaign is going to be blockchain, its implementation in various sphrese and raising awareness about this technology as well as cryptocurrencies among the people.

If we accept the Blockchain as our guiding light, our hearts and our minds can be free,” he added in a rather poetic way.

We remind you that McAfee does not actually want to become the President of the US, he just wants to run for the post. Here is why:

Why Is John McAfee Not Planning to Be the President?

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TRON Is Partnering Up with Baidu: What Is the True Purpose of This Collaboration?

A decentralized blockchain platform TRON, which is one of the main competitors of Ethereum, announced its partnership with the Chinese web services giant Baidu.

Although, the TRON team assures the aim of this partnership is spreading blockchain solution among the crypto community, there has been a lot of speculation regarding this issue.

Many people believe that TRON is currently working on the launch of its own platform for video content, as an alternative to YouTube. Such assumptions were caused by the comments from TRON developers regarding the recent access issues on YouTube. They claimed that this would not have happened on TRON.

We remind you:

Justin Sun Offers the Venezuelan President to Connect Petro to Tron instead of Ethereum

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The Blockchain-Based Platform of Telegram Is Almost Ready

Telegram (cosmonaut)

As reported by the news media Vedomosti, the first news about the upcoming release of the blockchain of Telegram Open Network (TON) appeared in September and were privately sent to the major investors.

The project is approximately 70% ready. The main component, Virtual Machine, is fully completed, meanwhile, the developers are finishing up with the actual blockchain: the structure for creating new blocks and storing data in them.

Pavel Durov, the founder of Telegram messenger, and his team managed to raise almost $2 billion for this platform. It will be functioning some time at the end of November.

We remind you that the first stage of this blockchain, the Telegram Passport, which is a verification and authentication service, successfully went live in July.

Telegram Launches Passport Authorization Service

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Sony Will Manage Its Work Using the Blockchain Technology

The Japanese electronics giant Sony announced the adaption of the blockchain technology in order to improve and upgrade its systems of work.

As stated in the official press release of the company:

This new system is based on Sony and Sony Global Education’s previously developed system for authenticating, sharing, and rights management of educational data, and additionally features functionality for processing rights-related information.

Different branches of Sony will utilize blockchain for similar purposes, but in different spheres, namely:

1. Sony Corporation, which is actually a producer of electronic devices, will create a special management structure on blockchain. It will help keep track of copyright of particular digital content and protect it from any type of violation.

2. Sony Music Entertainment will use the system while focusing mainly on music-related content. Given the amount of music stolen nowadays, Sony representatives believe that their innovation might help smaller artists keep ownership to their own music.

3. Sony Global Education aims at revolutionizing the sphere of education. Blockchain will be used to manage and distribute information and store educational content.

This is not the first time the company touched upon blockchain. In the past, it submitted around 20 different blockchain-related patents and made it into top-30 businesses that work with this technology.

Sony is not the only electronic device producer that took interest in blockchain. We remind you:

Samsung Created a Blockchain Platform for Banks

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Donald Trump’s Ex-Counsel Became an Advisor of a Blockchain Startup

Trump's assistant became an adviser of a blockchain project

Gary Cohn, a former economic policy advisor of the US President Donald Trump, has become an advisor of the project Spring Labs.

The banker worked at the investment and financial holding Goldman Sachs Group for more than 25 years, he served as a President and Chief Operating Officer. In 2017-2018, he was an assistant of the current President of the United States.

I have been very interested in blockchain technology for a number of years, and Spring Labs is developing a network that could have profound implications for the financial services sector, among others,” said Cohn. “I am excited to actively support the Spring Labs team in the development of this important business and network.”

The other Spring Labs advisors are:

  • the former chairman of the Federal Deposit Insurance Corporation of the United States (FDIC), Sheila Bair;
  • Nigel Morris, the co-founder and former [resident of Capital One banking holding company;
  • the chief lawyer of the crypto exchange Coinbase, Brian Brooks.

We remind you:

Ex-Counsel of Trump Predicts the Emergence of a New Global Cryptocurrency

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What is Ethereum Address (ETH address)?

This information will be useful for those readers who are the beginning of their way in the cryptocurrency world. In this article we will talk about such concept as Ethereum address, find out what it is necessary for, where you can find it and see it. So let’s get started.

Contents:
(please, click the topic to scroll down to it)

  1. What is Ethereum address and what is it for?
  2. Difference between online and offline addresses
  3. Conclusion

1. What is Ethereum address and what is it necessary for?

To begin with, it should be noted that Ethereum is the second most popular and capitalized coin. It has significant differences from the flagship of the industry with a good sense of the word. Ethereum has a more advanced technological base. For example, Bitcoin, in fact, is only a payment system, and on the basis of Ethereum you can create your own coins and smart contracts. Ethereum is a platform from which, potentially, a great number of companies and individuals can operate.

So, we are over with the introductory part, now let’s get to the essence of today’s question. ETH address is a certain unique set of letters and numbers, with a help of which a specific wallet can be identified. It is necessary to transfer coins from one wallet to another. It can be easily shared, since knowing it doesn’t reveal any important information about the owner and the state of balance.

Only the owner can receive the address. To get it you have to run the wallet application on a computer or mobile device. Without any doubt, in the interface of any crypto wallet program (there is a large number of services for storing Ethereum) you will find a special button that will automatically generate the wallet address.

2. The difference between online and offline addresses

If you are just starting your crypto journey, then you probably do not know that there are different types of digital wallets. We will dig into this topic too deeply, but just describe the main points. More information about the classification of wallets can be found on our website. So, the wallets can be:

  • Online. These include web-wallets and personal accounts that are on the exchanges. This is the most insecure, but the most convenient way to store and exchange coins.
  • Desktop and mobile apps. These are so-called hot wallets. They are more secure than online solutions, but with their help it is no longer possible to make transfers so quickly.
  • Hardware wallets. They are the safest way to store coins, since it is virtually impossible to hack them and get access to assets. But they are very inconvenient for every day use. This type of wallet is ideal for long-term storage.

So, you can get an Ethereum address both online and conditionally offline, on a desktop or mobile wallet application. Сonditionally offline, because even if the wallet is physically located on the computer, you need access to the Internet to work correctly. There is no principal difference between online and offline addresses, the only thing is that coins will arrive either on an online wallet, or on a desktop or mobile application.

It is very important to use only official wallets for storing ETH or any other coin. Since they are best optimized for work with this or that blockchain, and also have more advanced level of security than a service that was developed by third-party developers.

3. Conclusion

Everything about cryptocurrency topic seems so complicated, but this is only at first glance. Of course, the wilds of cryptography and the operation of algorithms are not easy, but for ordinary users such information is absolutely useless. The knowledge that is necessary in order to use cryptocurrencies can be obtained by any average person in the shortest time possible .

So, in this article, we discussed what Ethereum address is and found out that this is only the identifier of a certain wallet and is needed to transfer coins from one account to another.

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