Blockchain for Dummies

FrgMstr

FrgMstr

Just Plain Mean
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Reuters Graphics has published a visual guide entitled Blockchain Explained. If you are not up to snuff on what exactly blockchain is, this is actually a very good starter pack that even your grandmother is likely to understand....did I mention it has lots of pictures?


A blockchain is a database that is shared across a network of computers. Once a record has been added to the chain it is very difficult to change. To ensure all the copies of the database are the same, the network makes constant checks. Blockchains have been used to underpin cyber-currencies like bitcoin, but many other possible uses are emerging.
 
I just hope they use some sort of max size limiter because the energy to check the chain is nuts at the moment. Like block 1a then go from there using the last check for the first strand of 2a etc...
 
I still don't get how, with this technology, you can steal bitcoins... or that transactions remain "anonymous".
 
Brian_B said:
I still don't get how, with this technology, you can steal bitcoins... or that transactions remain "anonymous".
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both PEBKAC issues

coins are stolen from end users failing to secure their private keys

transactions are only as anonymous as the end users opsec
 
jojo69 said:
both PEBKAC issues

coins are stolen from end users failing to secure their private keys

transactions are only as anonymous as the end users opsec
Click to expand...

So in all reality - crypto currency isn't any more (or less) secure or anonymous than traditional cash?

How far we've come with technology.
 
Brian_B said:
So in all reality - crypto currency isn't any more (or less) secure or anonymous than traditional cash?

How far we've come with technology.
Click to expand...


Well, except that you can make a totally secure, irreversible transfer of almost any amount to any other person on the planet in about an hour, and no bank or government can do fuck all about it.
 
jojo69 said:
Well, except that you can make a totally secure, irreversible transfer of almost any amount to any other person on the planet in about an hour, and no bank or government can do fuck all about it.
Click to expand...

Of magic coins, which are worth exactly whatever someone else is willing to buy them for on an exchange. Not really all that different from any other non-currency.

I could say the exact same thing about my email... I can make that totally secure, irreversible, and in any amount to any other person on the planet... in probably much less than an hour. And it's worth the exact same amount -- whatever someone else is willing to buy them for on an exchange.

Or I can call my bank and have them wire actual currency. How secure that is exactly I have no idea... but it's pretty fast, and doesn't rely on waiting on some blockchain miners to verify my transaction (that I'm aware of), and it's actual currency that doesn't need to be run through an exchange to have value.
 
Brian_B said:
Of magic coins, which are worth exactly whatever someone else is willing to buy them for on an exchange. Not really all that different from any other non-currency.

I could say the exact same thing about my email... I can make that totally secure, irreversible, and in any amount to any other person on the planet... in probably much less than an hour. And it's worth the exact same amount -- whatever someone else is willing to buy them for on an exchange.

Or I can call my bank and have them wire actual currency. How secure that is exactly I have no idea... but it's pretty fast, and doesn't rely on waiting on some blockchain miners to verify my transaction (that I'm aware of), and it's actual currency that doesn't need to be run through an exchange to have value.
Click to expand...

"Actual currencies" are traded on exchanges.

Your wire transfer relies on the SWIFT network which has been hacked repeatedly.

You may as well compare a floppy disk to a petabyte.
 
Brian_B said:
So in all reality - crypto currency isn't any more (or less) secure or anonymous than traditional cash?

How far we've come with technology.
Click to expand...
And if all currency transactions were made in bitcoins, then we'd use a year's worth of energy in a day, or was it an hour? I don't care to re-do the calculations. Safe to say it is not viable because of the huge energy demand.
 
Retronym said:
"Actual currencies" are traded on exchanges.

Your wire transfer relies on the SWIFT network which has been hacked repeatedly.

You may as well compare a floppy disk to a petabyte.
Click to expand...

That is a pretty good comparison. One is a physical thing I can hold in my hand, and it holds data.

The other is just ... a specified number of random bits. It may be a big specified number, but that doesn't make it any better or worse.

A serious question: Ok I understand a lot of people believe in cryptocurrencies. I don't really have anything against the cryptocurrency itself.. I think it's ridiculous that it burns as much energy as it does calculating blockchains, but that's a technical issue that will probably get resolved if the tech sticks around.

I do have an issue with the fervent defenders with blinders on.

So, if your employer decided to start paying out in Bitcoin tomorrow, would you be ok with that? Your salary would be set in Bitcoin, and not the exchanged rate to local currency. For instance - your monthly salary would be 1 Bitcoin/month, not whatever your current salary is, just paid out in equivalent number of bitcoin instead? And just to up the stakes a bit, let's assume that would be your sole source of income.

I understand that some would likely be willing to take that risk. With my wife & kids, my life - no way I would be willing to do that until the market. Sure, you may get months where Bitcoin hits $10k (and you can buy a desk, yay). There's also the chance it could completely dry up and blow away. That is my issue with cryptocurrency. I think it's perfectly fine right now to go out and buy hookers and blow with. I think it's great that people want to stabilize and legitimatize it, and if it ever got there I'd be perfectly ok with that. But I don't think the majority of crypto-users really want it to go main stream, and accept all the accountability and regulation that is associated with that.

Crypto right now is the wild west. I don't feel like playing Cowboys and Indians with my family right now. Hats off to those of you that do. I'd prefer my spare cycles go to something like F@H. I consider that a worthy cause, even if it doesn't cut me a paycheck. I'll go out and actually do my job for my income. Right now, looking at pros/cons of crypto versus just plain cash, I don't really see a big difference apart from one is a bit of digital bits, and the other a physical bit of wood pulp and cotton. If you think one is more secure or anonymous or free from government interference/control/tracking than the other, your only deluding yourself.
 
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block-clipart-block-microsoft-clip-art.jpg


chain-link-black-web.jpg
 
Brian_B said:
That is a pretty good comparison. One is a physical thing I can hold in my hand, and it holds data.

The other is just ... a specified number of random bits. It may be a big specified number, but that doesn't make it any better or worse.
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And therefore the floppy must be superior.

/s
 
M76 said:
No, it's not good. Blockchain is the lumbering dinosaour all want to cling to for some reason. But it's inflexible, slow, and eats a ton more than anything else.[/QUOTE} WTH are you even talking about.
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That's exactly the problem. You don't know. Blockchain is so inefficient, that if all financial transactions around the world would be made using bitcoin, it would need 10x the US electricity consumption to process them all. Yes rougly one magnitude more electricity that is currently being used by the USA.
So don't go around shouting that blockchain is good. It's the must wasteful and unnecessarily complicated bullshit humankind has ever imposed on itself. I mean the financial system is bad, but it's a model of efficiency when compared to the blockchain based nightmare.
 
M76 said:
That's exactly the problem. You don't know. Blockchain is so inefficient, that if all financial transactions around the world would be made using bitcoin, it would need 10x the US electricity consumption to process them all. Yes rougly one magnitude more electricity that is currently being used by the USA.
So don't go around shouting that blockchain is good. It's the must wasteful and unnecessarily complicated bullshit humankind has ever imposed on itself. I mean the financial system is bad, but it's a model of efficiency when compared to the blockchain based nightmare.
Click to expand...
It is a dynamic difficulty. It could be even higher.
 
Brian_B said:
I still don't get how, with this technology, you can steal bitcoins... or that transactions remain "anonymous".
Click to expand...

the transactions are only as anon as the NSA wants them to be - that's my guess anyway based on past discoveries by whom ever.

No human has ever built a lock that another human can't eventually pick which is why Fort Knox is protected by a small army
 
M76 said:
No, it's not good. Blockchain is the lumbering dinosaour all want to cling to for some reason. But it's inflexible, slow, and eats a ton more than anything else.
Click to expand...

Blockchain itself isn't the problem, or even the source of the majority of the consumption of power for Bitcoin and other cyrptos. It's the method (Proof of Work) chosen for securing it that takes all the power. That can be changed.
 
maybe I missed it but I don't recall there are any "proof of "STAKE" (is what u mean for lower power)" cryptocoins even worthwhile.
 
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either one is superior to proof of war, the foundation of the value of USD
 
Mega6 said:
maybe I missed it but I don't recall there are any "proof of "STAKE" (is what u mean for lower power)" cryptocoins even worthwhile.
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proof of stake, proof of capacity, confirm x transactions to submit a new one, whatever might be on the horizon that we haven't seen yet, etc. The point wasn't which coins used better methods, but that better methods could be used, even on Bitcoin itself, that would greatly reduce the power demand that was incorrectly being used to demonize the blockchain concept as a whole in the post I quoted..
 
M76 said:
That's exactly the problem. You don't know. Blockchain is so inefficient, that if all financial transactions around the world would be made using bitcoin, it would need 10x the US electricity consumption to process them all. Yes rougly one magnitude more electricity that is currently being used by the USA.
So don't go around shouting that blockchain is good. It's the must wasteful and unnecessarily complicated bullshit humankind has ever imposed on itself. I mean the financial system is bad, but it's a model of efficiency when compared to the blockchain based nightmare.
Click to expand...
You don't know what I know. Spoken like a true bankster.
 
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