What is the blockchain?
What is the blockchain and what is the blockchain technology in general?
Hi! My name is Yannis and I am the founder of Puppy Coin and Kryptohodlers.
But before we start, I have to cover my ass and the disclaimer is that we are not financial advisor.
We do these videos only for educational and recreational purposes.
If you are seeking financial advice, you need to talk to a financial advisor about investments, cryptos and whatever else you want.
So, let’s dive to today’s topic, what is blockchain?
I think many of you have herad about crypto, cryptocurrencies and some huge websites, like Coinmarketcap.com.
Coinmarketcap.com is one of the biggest websites for binance exchange and there are listed many huge cryptocurrencies that have their own blockchain.
All the above have their own blockchain, but many of them are based on the blockchain of other cryptocurrencies, like Ethereum and you can build your own token on the Ethereum blockchain or on the Binance Smart Chain blockchain.
It is compatible with many other blockchains that have the smart contact function of the Ethereum Virtual Machine.
But let’s get back to the basics.
What is a blockchain and what is the blockchain technology in general?
A blockchain is a distributed ledger, a database that is shared among the nodes of a computer network.
That means that we don’t have a centralized computer like a banking system that has loans, assets, who owes to whom and we need to assess this computer by providing our own information.
For instance, we need to KYC (Know Your Customers) and we need to prove our identity in order to do banking with these institutions that are centralized.
Some of these institutions are HSBC, Barclays and all the other banls that you know and exist all around the world from the old days of the functional banking system.
The decentralized database, the blockchain technology and the blockchain system stores information in the digital format.
That means that every note stores information about the whole system and need to be in unison with the other notes in order to process the transaction.
We need some notes to say that a transaction is legit in order to proceed with all the transactions.
This system is permissionless, we don’t need to prove our identity.
We only need to have our own wallet or to be one of these notes.
We need a cryptowallet, as I told you before, like MetaMask Wallet which doesn’t need any proof of who we are.
MetaMask doesn’t need any KYC and everyone can use as many wallets as they want.
I have my own wallet in my mobile phone or on my computer, you can download MetaMask Wallter or any other wallet like Trust Wallet.
So, when did the blockchain started?
The blockchain started as far as 1991 as a research project and the cryptography technology has a huge progress in the last 2 decades, but Bitcoin first took place and started as a widespread application in 2009, by a crypto guy, cryprographer that nobody knows who he really is.
His name is Satoshi Nakamoto, he lived in San Francisco area bay and he creted the first 100% blockchain based decentralized currency, the Bitcoin.
I think today everyone what Bitcoin is.
Also, Bitcoin was the first successful decentralized currency that stood in money exchange.
It is money itself, it has store value, but it has a big disadvantage: it cannot be used like a cryptocurrency in everyday life.
You cannot pay with Bitcoin today, because the blockchain and the Bitcoin are very slow, so we need something a bit faster like Visa and Vitalik Butern came up with the idea of Ethereum in 2013 in order to introduce some of the smart contracts that are decentralized apps, DApps and the Web 3.0 technology.
Some key points about blockchain technology
Can I build my own blockchain?
Everyone can build their own blockchain, so the question is can I build my own blockchain?
The answer is yes, but you have to own at least some computer notes.
What is a computer node?
A computer node is a computer server that runs in Linux technology and you need to have a special software, to get validation for other notes.
Everyone can run their own note and they could connect with everyone else with an algorithm.
These algorithms are like a computer program that comes to an agreement with everyone else that this transaction is legit, that we have the funds and so we can proceed to do business with this blockchain.
One big advantage of the blockchain technology is the transparency.
Blockchain technology offers huge transparency with the blockchain explorers.
Bitcoin has it’s own blockchain explorer, Ethereum has it’s own blockchain explorer, the ETHer scan.
Binance Smart Chain has it’s own blockchain explorer, Binance Smart Scan or the BSC scan and many other cryptos have their own explorers, where you can see every previous exchange that happened before in the past.
It is a ledger that shows what is send to whom, address and time and what other exchanges took place, like in Nike, a cryprocurrency for PancakeSwap that is a decentralized exchange.
Is blockchain secure?
Until today, we didn’t have any problems with blockchain hackings.
We had problems with other Layer 2 contracts and smart contracts, because the code was not so good, it wasn’t well written or well audited and hackers took advantage to steal some coins, some Ethereum, some Bitcoin and other coins people had.
But, generally speaking Bitcoin is a secure technology, because you need to spend at least 51% of the gas fees in order to attack to the Ethereum blockchain.
We need to spend a huge amount of money, energy, time and resources in order to hack the Ethereum blockchain and make everything else legit and govern the whole system.
This means that we need a huge amount of money that is not viable in order to hack the whole blockchain.
What are the applications of blockchain?
How are blockchains used today?
1 Provide banking services to the unbanked
Some of the best applications of blockchain technology is banking to the unbanked people.
Many people don’t have to a bank account, even here in Greece that we are living today many people cannot open a bank account for many reasons.
Many of them have problems with government and taxes, some of them are illegam immigrants, so a bank cannot open an account to them or the bank doesn’t want to do business with you and they don’t open an account or provide you a cash card for everyday life.
This has many applications in the economy, especially in the third countries like Africa or Latin America.
The unbanked people are almost a majority there than a minority that they are in Europe.
The blockchain systems can provide payments and banking services to the unbanked.
Take for instance the Defi system, the PancakeSwap, the MetaMask Wallet.
You can make peayments with cryptocurrencies or even the private exchanges which are centralized exchanges like the Binance can do business with you by providing the KYC and they give you also a cash card that is based on BNB.
But you can still have banking services, they can provide you banking services.
The transaction fees are smaller than the banking fees in some areas and the transaction speed is better than some other banks.
For instance, if you would like to send money abroad I would need 1- 2 days to do it, but with the Ethereum blockchain I could have sent the money in 10-15 seconds, depends on how much are the gas fees and how much congestion the network has.
One of the best uses of the blockchain today, apart for the Defi, is the NFTs.
2 Secure your online identity
You can build a NFT or use Real Estate NFTs instead of having actual property ownership and papers to have your house on NFT and sell the NFT.
The usage will spread in the daily usage, like for tipping activities, buying small things etc.
Also, a big usage in the blockchain technology is made in the healthcare system, that the hospital records could be help there for transparency and privacy.
And the property records can be held there, for instance, the ID, the driving license and won’t need to have your papers with you, you will only need to have a cryptowallet or a NFT wallet.
What do you think about the blockchain technology?
Will our lives be different in 10 years because of the blockchain?
Do you own a cryptocurrency like Ethereum or Bitcoin?
Would you ever invest to some of them?
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