Blockchain 101

Blockchain 101 - CoinDesk "The practical consequence [is] for the first time, a way for one Internet user to transfer a unique piece of digital property to another Internet user, such that the transfer is guaranteed to be safe and secure, everyone knows that the transfer has taken place, and nobody can challenge the legitimacy of the transfer. The consequences of this breakthrough are hard to overstate."

As stated in our guide "What is Blockchain Technology?", there are three principal technologies that combine to create a blockchain.

As discussed in our guide "How Does Blockchain Technology Work?", the identity component of blockchain technology is fulfilled through the use of cryptographic keys.

Unencrypted data - can be read by every blockchain participant in the blockchain and is fully transparent.

These are programs which control blockchain assets, executed over interactions on the ethereum blockchain.

The technology has also been closely examined: millions of dollars have been spent researching blockchain technology over the past few years, and numerous tests for whether or not blockchain technology is appropriate in various scenarios have been conducted.

In 2016, a blockchain project called The DAO, running on the ethereum blockchain, was launched with the aim of emulating a crowdfunding market.

Some people in the blockchain industry have pointed out that blockchain has become overhyped, when, in reality, the technology has limitations and is inappropriate for many digital interactions.

These disagreements are a notable feature of the blockchain industry and are expressed most clearly around the question or event of 'forking' a blockchain, a process that involves updating the blockchain protocol when a majority of a blockchain's users have agreed to it.

The lightning network will further boost bitcoin's transaction capacity by taking frequent, small transactions off-chain, only settling on the bitcoin blockchain when the users are ready.