What exactly is blockchain? If you're a little confused when we talk about blockchain, don't worry, we're going to explain it all to you simply and clearly. Imagine you're a curious kid and you want to understand how this fascinating technology works. Well, that's exactly what we're going to do! Let's go !

Definition

Blockchain is the revolutionary technology on which all crypto-currencies are based. It can be likened to a decentralized, secure digital ledger. Unlike traditional centralized databases, blockchain operates via a peer-to-peer network, where each participant, known as a node, holds a complete, verifiable copy of all recorded transactions.

The key feature of blockchain is its immutability. Once a transaction has been added to the blockchain, it becomes virtually impossible to modify or delete. This guarantees data transparency and integrity, as all transactions are permanently and verifiably recorded.

Blocks and chain

Blockchain enables information to be stored and transferred securely and transparently. To better understand this technology, let's start by breaking down the word "blockchain", which is actually a chain of blocks. A blockchain is made up of blocks, and each block contains information. These blocks are linked together to form a chain. Each block contains a set of transactions, and when new transactions take place, a new block is added to the chain.

A ledger with an infinite number of pages

Blockchain is often compared to a book with an infinite number of pages, due to its unique structure and the way it records and secures information. This analogy provides a more intuitive understanding of the fundamental principles of blockchain. So why is this comparison so apt? Let's explore it together.

Imagine a traditional book. It has a limited number of pages, and you can write information on each page. But what happens when the book is full? You either have to add new pages, or use a new book. This can lead to problems in managing, storing and retrieving information.

Now imagine a book with an infinite number of pages. You can continue to write and add information indefinitely, without worrying about available space. Each page is linked to the previous and the next, forming a continuous, uninterrupted sequence. This is exactly what happens with blockchain. In blockchain, each page corresponds to a block, and each block contains a set of transactions or information. These blocks are linked together chronologically, forming a continuous chain of data. Each block also contains a unique identifier called a "hash", which links it to the previous and following blocks. This guarantees the integrity and security of the data stored on the blockchain.

Now, back to our book with an infinite number of pages. Once the information is written in the book, it becomes permanent and can no longer be modified. This is also the case in blockchain. Once data is recorded in a block and added to the chain, it becomes immutable. This creates a transparent and secure record of all transactions and information recorded.

The concept of decentralization in blockchain can also be understood by comparing it to a book with infinite pages. In a traditional book, a single person is responsible for its content and management. But in blockchain, every node in the network owns a complete copy of the chain. This means that no one person has exclusive control over the blockchain, and that all parties in the network participate in the verification and validation of transactions.

The security of blockchain

Why is it secure?

Blockchain is often regarded as an extremely secure technology. Transparency is its watchword! In fact, every transaction is forgery-proof and indelibly written to the network. They are therefore visible to all network participants.

And since transaction traceability enables suspicious activity to be detected quickly, it reinforces accountability and deters fraudulent behavior. Now you can contradict your friends who will tell you that crypto and blockchain are great instruments for laundering money and funding terrorism!

Since blockchain is decentralized by nature, it is particularly resistant to censorship. Indeed, there is no central authority capable of controlling or censoring transactions. This means that users can carry out transactions pseudonymously and without restriction, enhancing security and confidentiality.

Another key aspect of blockchain security is the use of cryptography. Every transaction recorded on the blockchain is encrypted using complex algorithms. These algorithms guarantee the integrity of the data, making it virtually impossible to alter or falsify. Digital signatures also authenticate transactions, guaranteeing their origin and validity.

Another reason why blockchain is considered ultra-secure is its consensus mechanism. Different variants of consensus, such as Proof of Work and Proof of Stake, ensure that all network stakeholders must agree on the state of the blockchain. This distributed consensus eliminates the risk of data manipulation by malicious third parties.

How does blockchain work?

To secure its network, all users have a financial incentive to participate. Indeed, as a reward for their work, participants receive the crypto-currency native to the blockchain in question (e.g. bitcoin for the Bitcoin network, or ether for the Ethereum network). Nevertheless, there are various security mechanisms:

Proof of Work (PoW)

Proof of Work (PoW) is widely recognized as the basis for the operation of the most famous blockchain, Bitcoin. This process, also known as "mining", involves using the computing power of a decentralized network to solve complex mathematical problems. These problems are designed to be difficult to solve, but easy to verify once solved. Network participants, known as miners, use their computing power to attempt to solve these problems. The first miner to solve the problem receives a reward in the form of cryptocurrency. This reward motivates miners to participate and devote considerable resources to solving problems.

PoW guarantees the security and integrity of the blockchain by making the process of validating transactions costly in terms of resources, particularly computing power. The complex nature of mathematical problems makes it extremely difficult for an attacker to modify transactions that have already been validated.

To alter a past transaction, an attacker would not only have to solve the corresponding mathematical problem, but also outstrip the computing power of the entire network. This characteristic makes the blockchain resistant to "51%" attacks, where an attacker would attempt to control the majority of the network's computing power.

Notwithstanding, Proof of Work is an energy-intensive mechanism. Miners have to use powerful computers, which results in high power consumption. This energy consumption has given rise to concerns about environmental impact, and explains why Bitcoin is often criticized.

Proof of Stake

Proof of Stake (PoS) has been created as a less energy-intensive alternative to Proof of Work. This mechanism can be described as green, since it reduces energy consumption by 99.9%. This is one of the reasons why the Ethereum blockchain recently switched to PoS.

In a Proof of Stake system, crypto-currency holders can participate in the validation of transactions and the creation of new blocks according to the quantity of tokens they possess. In other words, the more tokens you hold, the more likely you are to be chosen to validate transactions and receive rewards.

The fundamental idea behind PoS is that people with a financial stake in the blockchain are less likely to compromise it. This means that participants are not required to solve complex mathematical problems, as is the case in PoW, but rather to prove their participation by staking their tokens.

Applications of blockchain

Now that you understand the basics of blockchain, you may be wondering what it can be used for. Well, blockchain has many potential applications in various fields.For example, blockchain can be used to carry out financial transactions securely, without the need for an intermediary such as a bank. It can also be used to create smart contracts, which are self-executing digital contracts. In addition, blockchain can be used to improve product traceability, enabling consumers to verify the origin and authenticity of the products they buy.

Conclusion

There you have it, you now have a clear idea of what blockchain is and how it works. Of course, there's much more to learn about this fascinating subject, but we hope this article has given you a solid foundation for understanding the fundamentals of blockchain.

Don't forget that blockchain has the potential to transform many sectors and bring positive change to our society. So stay curious and keep exploring the endless possibilities of this revolutionary technology! 

Now that you're a little more informed about blockchain, why not share your newfound knowledge with your friends? You might be surprised at how much it can spark interesting discussions! Now it's your turn!