Blockchain For Beginners - Explaining Blockchain, Bitcoin, and Ethereum to My Parents!
Hellooooo Steemit Community!
With blockchain on the rise, I recently found myself explaining Blockchain Technology and why I had invested in this crazy thing called Ethereum. After a brutal attempt to help them conceptualized the idea of blockchain, I decided to write them a brief message, explaining my views on the subject. Heres what I came up with!
Welcome the internet 3.0.
I’ve attached a few documents and links below that can help you conceptualize blockchain and my thoughts on the Ethereum Protocol.
Simply put, a blockchain is a globally distributed ledger accessible to anyone. Millions of computers agree on the global record of every transaction that has ever taken place. When a transaction occurs, it is broadcast across the network. The blockchain is maintained by distributed nodes known as “Miners” (anyone who has a computer can act as a “Miner”, adding to the distributed network) who ensure the legitimacy of each transaction and the ledger as a whole. Modeled on how gold is mined out of the ground, “Miners” receive minted cryptocurrency such as Bitcoin or Ethereum for solving complex cryptographic equations that require large computing power. Because there are millions of computers monitoring the blockchain’s distributed ledger, it is impossible for someone to disrupt or rewrite a transaction in the ledger as this would require someone to hack all of the preexisting transactions simultaneously whilst hacking every computer on the network. As a result, blockchains have never been hacked since their conception in 2009.
Don Tapscott does a great job describing the importance of blockchain technology and separating it from its most well-known counterpart, Bitcoin. Among other developments, Ethereum has taken advantage of the underlying blockchain technology by creating self-executing contracts known as "Smart Contracts” - an evolutionary idea that can be applied to nearly every industry.
**https://www.ted.com/talks/don_tapscott_how_the_blockchain_is_changing_money_and_business **
The Ethereum Protocol was developed in approximately two years ago by Russian-born but Canadian-raised Vitalik Buterin at the age of 19. Ethereum developed its own coding for a new blockchain, separate from Bitcoin’s blockchain. The new blockchain allowed for revolutionary ideas to take effect. Ethereum allows for blockchain technology to span beyond Bitcoin’s purpose as a store of value. In a simple sense, Ethereum is a worldwide distributed decentralized computer with theoretically unlimited power. A developer is able to code a solution (a lease transfer per example) and deploy it into the network. The network then executes it by itself, verifies the outputs by itself, and distributes value between participants accordingly by itself. The applications run in an absolutely transparent manner, without any input from a central authority that could influence the transactions.
The Enterprise Ethereum Alliance is a testament to the widespread recognition of blockchain and The Ethereum Protocol. Just last month, the EEA became the world's largest open-source blockchain initiative whose total membership exceeds 150 organizations including Microsoft, Cisco Systems, ScotiaBank, MasterCard, NYC Melon, Sony, etc.
Two months ago, Ethereum’s founder Vatalik Buterin met with Russian President Vladamir Putin and Russian industry leaders. Putin officially endorsed Ethereum and sees blockchain playing a major role in the future of Russia. Now in early August, Russia seems to be moving forward with its interest in blockchain technology. They have begun testing an Ethereum-based “MasterChain” believing the new technology could cut costs by up to 80%.
Tech savvy areas have followed suit. Zug, Switzerland is being hailed as the “Crypto-Valley” where blockchain startups like Ethereum-based UPort (sovereign identity service to be used in Zug come this September) are taking foothold. In April of this year, Dubai stated its goal for becoming fully blockchain run by the year 2020.
These were just the cliff-notes. With a total market cap of approximately $100 Billion for all cryptocurrencies (up from roughly $2 Billion at the start of 2016), it is just a fraction of the $3 Trillion dot com bubble of 2001. When considering how far this market could go, it is important to note exponential power of these systems - especially in comparison to the uniform internet we experience today.
Great write up, i've been trying to explain blockchain technology to my coworkers for weeks, no one gets it. I'll be sending them all this post! thank you!
I appreciate it! it really is a struggle sometimes. You often come out looking like you're wearing a tinfoil hat if they struggle to understand the concepts!
very nice write-up. looking forward to some more of your work as i see you have not written anything lately here. From your topics i see you are interested in cryptos, consider following me if you like. regardless upvoted your post. cheers!
Took a little break from steemit to tackle some traveling, more to come for sure! Will do!