Business, Crypto

Crypto 101 and a bit more

What is a blockchain?
Why is cryptocurrency the future of the finance world?
Below you can find a deck I was preparing for a lighting talk at ESGgo.
Since I got some positive feedback on it, I wanted to share it broadly.
Hopefully, you will find it valuable.

What is a blockchain?

  • A blockchain is a chain of blocks that contains information.
    • A block – a list of records/transactions/smart contracts.
    • When a block is complete, it’s added to the network.
  • It is a digital ledger of transactions duplicated and distributed across the entire network (peer-to-peer).
  • While any conventional database can store this information, blockchain is unique because it’s decentralized. In other words, many identical copies of a blockchain ledger are stored on multiple computers spread out across a network. 
  • These individual computers are called nodes.
  • A blockchain is a distributed digital ledger that stores data of any kind. A blockchain can record information about cryptocurrency transactions, NFT ownership, or Defi smart contracts.

Characteristics of a blockchain

Immutable

Immutability means that the blockchain is a permanent and unalterable network. 

A collection of nodes

  • Every node in the network has a copy of the digital ledger. 
  • To add a transaction, every node checks the transaction’s validity, and if the majority of the nodes think it is a valid transaction, then it is added to the network. 
  • Without the approval of most nodes, no one can add any transaction blocks to the ledger. 
  • Any validated records are irreversible and cannot be changed. 

Decentralized

  • The blockchain network is decentralized, meaning no central governing authority will be responsible for all the decisions. 
  • A group of nodes makes and maintain the network. 

Secure

  • All the records in the blockchain are individually encrypted, which adds another layer of security.
  • No central authority – BUT no one can update or delete data on the network.
  • Every piece of information on the blockchain is hashed cryptographically, meaning every portion of data has a unique identity on the network. 
  • All the blocks contain a unique hash of their own and the hash of the previous block. 
  • The blocks are cryptographically linked with each other. 

Consensus

  • Every blockchain has a consensus to help the network to make quick and unbiased decisions. 
  • Consensus is a decision-making algorithm for the group of nodes active on the network to reach an agreement. 
  • Nodes might not trust each other, but they can trust the algorithm. 

Unanimous

  • Most network participants agree to the validity of the records before they can be added to the network. 
  • When a node wants to add a block to the network → It must get majority voting; otherwise, the block cannot be added to the network. 
  • Every record is updated simultaneously, and the updations propagate quickly in the network. 
  • It is not possible to make any change without consent from the majority of nodes in the network.

Asset Transfers

  • Record and transfer the ownership of different unique assets. 
  • Digital assets like NFTs (= a representation of ownership of digital art and videos).
  • To process the ownership of real-life assets, like the deed to real estate and vehicles.
    • The two sides of a party would first use the blockchain to verify that one owns the property and the other has the money to buy it.
    • They could complete and record the sale on the blockchain.

The Slides

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