Lets define what blockchains are since everyone seems to be throwing around that term and its important to know that blockchains apply to alot more than just finance and cryptocurrencies like Bitcoin and Ethereum.

The simplest way to label what a blockchain is, is to say that its a “new database technology”.

A more full definition of a blockchain would be that “it’s a 10 year old database technology that allows almost any business or organization to safely and permanently keep track of any number of ongoing transactions and data by storing exact copies of that changing information in virtual blocks which are chained to each other on a large number of computers at the same time”.

The reason blockchains are so exciting and safe are explained in these three words decentralized , cryptography and trustless.

Most banks or large organizations are known to use centralized databases which simply means that all of their information is centralized or stored on one or a certain number of computers and if something goes wrong than only those given access to those computers can find out what happened.

Now a decentralized database like a blockchain is where you spread out the same database information out onto a dozen or thousands of computers and if something goes wrong than any one of those computers can see the exact same thing at the same time.

Bitcoin runs on whats called a public blockchain which means that everybody in the world can actually see a transaction that took place forever because it makes a permanent mark on the blockchain which means that you could go back and find where and when and usually who did some mistake or criminal activity.

Now it must be known that different crytp coins and tokens use different blockchain technologies so the anonymity and security can vary with them to a degree.

Also an important point to stress is that there are public blockchains like bitcoin where you can see transactions on the blockchain forever but there are also private or hybrid blockchains which is why companies are excited because they can use the benefit of the blockchain but keep their corporate or organizational information private.

Now lets get to the second word cryptography which is what then makes this decentralized information completely safe from being hacked. (some think that Quantum computing could hack it eventually)

Now cryptography is an advanced branch of mathematics involving the term hashing which is what keeps the information secure so that nobody can cheat or charge twice for an item (known as double spending)

Now the way this cheating is completely stopped is with the term cryptography which is what is done to all the blocks in the blockchain and keeps things secure.

Basically the blockchain technology uses advanced math like hash numbers and every transaction is scrambled within each block of transactions and then linked up with the next block using even more secure math and whats called hashing numbers.

So if someone changed a transaction in one part of the world the hash numbers would no longer be exactly correct and this would immediately signal that something went wrong and the transaction would be stopped.

The two terms bitcoin and blockchain have become almost synonymous because they both came out at the same time in 2009 when the mysterious inventor Satoshi Nakamoto came out them.

Blockchains have become known as the essential glue that allows for crptocurrency and its use is rapidly spreading to other crypto-like areas like NFTs and smart contracts but will soon be used in almost every industry like healthcare, voting, collectibles and ore.

So far we’re only talking about blockchains as they relate to cryptocurrency but there are an ever increasing list of technologies that will soon rely on using the blockchain technology including what are called smart contracts, and voting, medical records, real estate deeds, retail reward programs, Iot (internet of things) etc.

Every cryptocurrency relies on either their own blockchain or one from a major organization.

Each block is basically linked to the one in front of and behind the other and there are special numbers generated called hash numbers that uniquely identify each transaction and prevents anyone from modifying any other completed transaction.

Lastly lets stress the fact that the blockchain technology was written in a type of software called open source which was a movement to allow for the freedom of expression and computer code.

So anyone can access the software and change it which is why we started with just the blockchain that applied to bitcoin and then Ethereum created their own blockchain.

After this many crypto companies made their tokens and relied on Etheruem’s blockchain and then some of these same companies then created their own blockchains to go along with their tokens and other interests.

Blockchains will soon be used just about anywhere that there is information to be stored or processed.

Now we’ll discuss the related terms like gas fees and mining crypto and smart contracts in the other sections.

(under construction Jan 13, 2022)