The block chain is an undeniably ingenious invention – the brainchild of a person or group of people known by the pseudonym, Satoshi Nakamoto. But since then, it has evolved into something greater, and the main question every single person is asking is: What is block chain?
People use the term ‘blockchain technology’ to mean different things, and it can be confusing. Sometimes they are talking about The Bitcoin Blockchain, sometimes it’s The Ethereum Blockchain, sometimes it’s other virtual currencies or digital tokens, sometimes it’s smart contracts. Most of the time though, they are talking about distributed ledgers, i.e. a list of transactions that is replicated across a number of computers, rather than being stored on a central server.
The common themes seem to be a data store which:
- usually contains financial transactions
- is replicated across a number of systems in almost real-time
- usually exists over a peer-to-peer network
- uses cryptography and digital signatures to prove identity, authenticity and enforce read/write access rights
- can be written by certain participants
- can be read by certain participants, maybe a wider audience, and
- has mechanisms to make it hard to change historical records, or at least make it easy to detect when someone is trying to do so