The blockchain revolution: definition, operation and perspectives

Blockchain Technology

Blockchain, is inseparable from bitcoin, the virtual currency created in 2008. In a way, it is a decentralized and collectively controlled book of accounts, based on the peer-to-peer (peer-to-peer) principle, from a distributed database. It is the blockchain that ensures the security of transactions by pooling trust. A system known to be transparent and tamper-proof, the scope of which goes far beyond the mere currency.

What is blockchain and why are we talking about a revolution about it? Behind this system of securing transactions in bitcoin, hides a concept that bases its reliability on transparency and a pooling of trust. Some believe that the blockchain has to play a central role in our existence by replacing the centralized trusted third parties like banks, notaries, insurance…

→To go further, discover the Web show Blockchain Revolution developed by the Etna school, the new alternance in computer science and the SII group.

The blockchain was born with bitcoin

The blockchain, or blockchain, in French, was born at the same time as the cryptographic currency called bitcoin and appeared in 2008. Bitcoin makes it possible to buy goods and services; it can also be exchanged for other currencies. Unlike traditional currencies, bitcoin is not administered by a single banking authority, it operates in a decentralized manner across a set of nodes. They form the network through which all transactions are made. A secure public registry keeps track of all these transactions. It is considered infalsifiable since it is based on the principle of shared trust.

«Miners» form the nodes of the blockchain

Each transaction is encrypted and stored in a block, which may contain several separate transactions. A block shall have a numerical marking from the previous block which shall attest to its validity. This marking operation is carried out by voluntary users, known as “minors”. The latter make available their time and computing power of their computers to administer the blockchain. Miners form the nodes, or rather the links of the blockchain.

This operation called “mining” allows these people to be remunerated, in bitcoin of course. The value of bitcoin is maintained by software that adapts the intensity of calculations to the number of active miners. The more bitcoin miners there are, the more complex the calculations are and the safer the blockchain is.

The future of the blockchain beyond bitcoin

Blockchain has many advantages. Financial first of all, since it reduces the costs associated with banking transactions and even eliminates banks as a trusted third party. In addition to digital payments, this technology can be used to transfer other assets, such as securities, bonds, shares, voting rights…

Moreover, the transparency of the system and its decentralised architecture give it an application potential that goes beyond the financial sphere. Since the blockchain is a registry, it can be used to establish traceability on all kinds of products and services. It can also be used to guarantee the application of smart contracts, programs that automatically execute the terms of a contract.

To go further on blockchain and bitcoin topics

If you are interested in learning more about bitcoin and blockchain, the SII Group and the School of Advanced Digital Technologies (Etna) have developed an Internet broadcast. Called Blockchain Revolution, it consists of seven one-hour episodes:

1-Understand the blockchain phenomenon;
2-Bitcoin validation protocol or “proof of work”;
3-Bitcoin in practice;
4-Bitcoin governance;
5-Bitcoin as a platform;
6-The explosion broke into blockchains;
7-The blockchain revolution and the interview with Andreas Antonopoulos.

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