Many people are asking exactly a Blockchain is and how it works. Let me explain this as part of my technical to laymen's terms series.
What is a Blockchain?
A blockchain is a new technology set which was first introduced as the unpinning technology for Bitcoin. It is actually nothing else than a distributed database or ledger.
Let's first explain what Centralised mean.
If we look at a bank or any other company for that matter, have what we call a central database. If you go to a store to purchase an item, the back end system for the shop or bank always write to the same database. This database is in a central place and all the shops connects to this database, either through the internet or a specific connection which links them to this database. This was important in the old days, as it is was very difficult to sync the various databases in the various shops before the centralised concept came in.
How does the Bitcoin blockchain work?
A lot of digital transactions around the world and all these transactions is then grouped or blocked together. These transactions are then cryptographically encoded in a protected block for the last 10 minutes worth of transactions. Should you want to understand more about the terms, referred to, please read my post about Crypto and Blockchain words explained in laymen's terms. The last block are then send to everybody who is participating in the network. The participants re called miners. They are then in a race to solve a cryptographic puzzle, and the first miner to solve the puzzle, get a reward called the block reward. In order to ensure that the miner did actually solve the puzzle correctly, all the other miners then checks if answer was correct. As soon as more than a specified percentage confirm that it is correct, a new signed block is formed, time-stamped and added to the chain* in a chronological order.
The process then starts again and is repeated over and over.
I hope this explanation answered somebody's questions. Please feel free to ask should you have a specific technical question which you would like explained in laymen's terms.
Some of my other in Laymen's Terms Post.
ICO's or token sales in Laymen's terms
Crypto Wallets in Laymen's terms
Smart Contracts in Laymen's terms
Artificial Intelligence in Laymen's terms
Blockchain and Digital Signatures - In Laymen's Terms
Trustless - What does it mean in laymen's terms?
Cyber Attacks explained in laymen's terms
Machine Learning - In laymen's terms
Internet of things and what it is in laymen's terms
Big data - What is it really about - In laymen’s terms
Some Technical Words explained in laymen's terms
Happy Steeming!
