What’s all the fuss about the blockchain? Find out in this article.
From Bitcoin to blockchain
The initial excitement about blockchain technology was about enabling peer-to-peer transfers of digital currency to anybody in the world, crossing human-created boundaries (like the borders of countries) without any intermediaries such as banks. This excitement was further heightened by the realization that this peer-to-peer capability could be applied to other non-cryptocurrency types of transactions. These transactions involve assets, such as titles, deeds, music and art, secret codes, contracts between businesses, autonomous driver decisions, and artifacts resulting from many every day human endeavors.
DEFINITION A transaction recorded on a blockchain contains a peer-to-peer message that specifies the operations executed, data parameters used for the execution of operations, the sender and receiver of the message, transaction fee, and timestamp of its recording.
A transaction record may contain other details based on the protocol and the application. Bitcoin has been continuously in operation from its launch. At the time of this writing, according to online charts, it’s delivering over 200,000 transactions per day. Following its initial success, people began to wonder, if you could transact digital currency, why not any other digital assets? This question was answered around 2013 by the addition of an environment for code execution on another popular blockchain, Ethereum. The innovation here was that the verification, validation, and recording could be extended to other digital assets, and related transactions and systems. Blockchain can, therefore, play a central role in implementing decentralized systems by providing software-based intermediation to other (non-currency) peer-to-peer transactions.
Exploring a real blockchain
Let’s take a look at a blockchain to give you an idea of what transactions, blocks, and chains of blocks look like to visualize blockchain context and problem space discussed in the next sections. We explore the transactions and blocks for the Ethereum public blockchain. Figure 1 shows transactions (Tx and…