Early 2008 Satoshi Nakamoto Published: “Bitcoin: Peer-to-Peer Electronic Cash System” Explanation: – Problems of innovation and reliability. – Bitcoin, a p2p version of electronic cash (not blockchain). – Consensus mechanics.
Blockchain is just a special kind of shared and secure database, owned by no entity, that is used to run bitcoins. Encrypted and self-regulated collection of transaction data, verified and stored on a computer network.
Blockchain is now a much broader concept, from distributed cloud computing to, of course, cryptocurrencies and NFTs. In this thread, I will give you a 360 ° overview of what a blockchain is.
Why Is the Blockchain Important?
People mentioned one big problem: reliability. Everyone in our society revolves around ways to guarantee trust between two or more parties. Simply put: Blockchain solves the problem of reliability, and decentralizes it.
What is the Blockchain?
Blockchain is rather a distributed network of nodes sharing a public database with cryptographic data and transaction information. Think of it as a large open database hosted on multiple computers.
How does the blockchain work?
The blockchain consists of: – nodes on which copies of the blockchain are stored. – Data storage and security blocks. – Consensus and proof of work. Let’s see how they work.
What are blockchain nodes?
The nodes are located in the blockchain. Each system connected to a blockchain is considered a node and shares the same copy of the blockchain with all other nodes. Nodes are constantly exchanging data to keep them informed.
What are blockchain nodes responsible for? –
Block validation. – Transaction processing. Nodes provide the necessary CPU power to maintain the blockchain and verify transactions. Believe me, blockchain is selfish.
What Are Blockchain Blocks?
A blockchain is a string of blocks that contain information. The data stored within a block depends on the type of blockchain. The bitcoins block contains information about the sender, recipient and number of bitcoins that need to be converted.
How Does a Blockchain Block Look Like?
Each block contains – Data. – Individual hash. – Hash in the previous block (parent hash). The first block (Genesis Block) is the only one without the parent hash.
Why are Blockchain Blocks Secure?
Each block in the blockchain has a unique HASH SHA256, which identifies its content, which is shared with the next block. If you change the hash, it will no longer match the parent’s hash, so the block will be invalid.
Proof of Work
Blockchain Proof of Work (PoW) is a mechanism by which decentralized networks can reach a consensus or agree on matters such as account balances or blockchain changes. The problem with the calculation puts effort into the work of the miners.
Proof-of-work-In-the-blockchain Each time a new node needs to be added or modified to a blockchain, a computational problem occurs and the first CPU to resolve it verifies the block. This is what miners, active blockchain nodes, do.
How do miners prove evidence of work? Miners predict nonce (used number one) through billions of tears and bugs, relying heavily on the CPU. Once the node resolves the nonce, it sends the result to the other nodes and a new block is added to the blockchain.
Blockchain is a decentralized network Blockchain uses a distributed peer-to-peer network in which anyone as a public can participate. When someone connects to the network, they receive a complete copy of the blockchain that makes up the node
Why the Blockchain Consumes so Much Energy?
Because Proof of Work is CPU intensive. Satoshi Nakamoto makes it clear that blockchain costs are shifting from money to electricity and CPU power. With a great impact on the environment.
How Slow a Blockchain Is?
Bitcoin Blockchain occupies 7 transactions per second. – Ethereum Blockchain occupies 14 transactions per second. – The credit card network has 25,000 transactions per second.