October 10, 2017

Can someone explain blockchain? (to a non-technical person)

I've been trying to read up on blockchain, but am still very confused on what exactly it is and how it works. I think bitcoin is an example of it? If anyone has a simple way of explaining it, or knows any good resources to check out, that be awesome!

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    Bitcoin is definitely an example of it and popularized it.

    At its core a blockchain is a ledger of transactions - just like the ones on your credit card statement.

    Roughly, every 10 minutes, multiple transactions are made and then confirmed by computers on the system.

    Those multiple transactions inside of that 10 minute time period are dubbed a 'block' of transactions. For example, you might pay for parking, buy a coffee, and then make a payment on your credit card all within 10 minutes. Those 3 transactions would go into the 'block'.

    Then every 10 minutes another 'block' of transactions occurs. This block gets 'chained' after the first block. The next 10 minutes the newest block is chained after the previous block and so on, forever. Hence the name 'blockchain'.

    That's the basics.

    But how those transactions are validated and confirmed by the system is another detail entirely and has to do with math, cryptography, and distributed computers around the world doing the work of consensually determining what goes inside the next block of transactions.

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      Do you also know of resources that explain the economy of bitcoins? Questions like why does the currency fluctuate so much, what are the impacts of an upper bound on the total number of bitcoins, and so on.

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      This is a good basic summary.

      I'd just add the following to address the last paragraph. I'm greatly simplifying what's happening but I think it captures the essence of how the ledger is trusted.

      The blocks of transactions are verified by doing a math problem (of sorts) with the results of the last block being factored in. That way if someone wanted to fake a transaction in the chain they'd essentially have to redo all the math problems in the chain. Meanwhile you'd have to have a majority of people also doing this in order to do something distrustful.

      I've sometimes thought about how you could demonstrate this with paper and pencil with a group of people. Imagine everyone doing a simple math problem using a new transaction plus the one before it. Once a majority of people have finished and we agree on the number, then we say sounds good, lets add the transaction to everyone's copy of the ledger.

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      Thank you so much. It helps.

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      Thanks so much, this is a great way to think about it! Exactly what I was looking for.

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    A very simple way to think of a blockchain would be a database that is unique in that it is decentralized (not stored on one single computer, but shared across thousands), and it is immutable (can't be changed). For bitcoin, all transaction are stored in this database. It is built with math so that you can verify everything in it, and also verify those who want to make changes (e.g. spend their bitcoins).

  3. 3

    Hey - I recently started writing a multi part series explaining blockchain. Hope it helps:


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      Thank you, this is great. I love the example you provided. Really makes me start to think about all the real world applications this can be used for.

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        Glad it helped! There is also part 2 of the post. Let me know how I could improve it. I see a lot of people are interested in blockchain but not a lot of explanations for non-technical people.

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    I know you want to understand more on blockchain rather than bitcoin. But since those two are closely interrelated, I recommend a Netflix documentary called "Banking on Bitcoin". It's a good intro to bitcoin/blockchain tech.

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      That's a great documentary. This is also a great watch by Vice: https://www.youtube.com/watch?v=SNssKmeXrGs&feature=youtu.be

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        Good stuff! Thanks for sharing.

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    A decentralized database

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      it's more than that

  6. 1

    And the award for serendipitous timing goes to...ajteich!

    Humble bundle just happens to be doing a great bitcoin, blockchain and cryptocurrency ebook bundle right now, and all for the princely sum of $15 for the entire book bundle.

    There's ten days left to snag the lot.


    I've purchased a few tech book bundles from humble bundle over the past few months (web security/hacking, linux and bash command line and others). Just started reading one of the bash scripting books yesterday and quickly realised what a tech information bargain I've stumbled across. Will probably buy the bitcoin bundle too.

    Can't believe nobody else has mentioned this yet! :)

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      I'm blown away by the amount of help and resources I've received. I have quite a bit of reading and YouTube watching to do this weekend. This community is really great..thanks for the ebook suggestion, I'll be sure to check out those humble bundle books.

  7. 1

    Tim Ferris has a great podcast on this if you have the time to listen.

    I'd also recommend Coin Skim (http://www.coinskim.com/) for a weekly update email on what's happening in the cryprocurrency world

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    Hi @ajtech This should take you less than an hour to go through, and is a series of short, crisp posts explaining one small aspect at a time (10 in total). It starts explaining Bitcoin, and brings in how it is a blockchain. Check it out: https://www.commonlounge.com/discussion/2cbc9e040a894db3bba5afb9f16dd463

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    This is the video that finally made things click for me. Hope you like it!


  10. 1

    I would suggest to go thru this https://toptalkedbooks.com/blog/FmEFZw/Resources-for-Cryptocurrency-Ethereum-vs-Bitcoin

    there are plenty of resources there.

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    I found this article is amazing, super simple explanation.


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    It's easy to say go watch videos but this is a simple explanation done in a visual way, well worth watching Adam.

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    This video helped me understand it (17 min): https://www.youtube.com/watch?v=_160oMzblY8&t=369s

    There's even an online demo (at https://anders.com/blockchain/block.html) to help you experience it first hand (but first watch the video).

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    (about 26min)

    This is probably the best visual explanation I've seen. His other videos are great as well.

  15. 1

    First, watch this short video - best blockchain explanation of a blockchain on the internet.


    Let me know if you still have any questions.

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    You should sign up for Portia Burton's mailing list. She offers an excellent blockchain for beginners webinar.

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    I found this interesting blog post making blockchain crystal clear. http://bit.ly/btchain

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