{"id":21721,"date":"2018-02-23T14:07:18","date_gmt":"2018-02-23T14:07:18","guid":{"rendered":"https:\/\/digileaders.com\/?p=21721"},"modified":"2019-05-08T14:44:13","modified_gmt":"2019-05-08T13:44:13","slug":"the-full-blockchain-story","status":"publish","type":"post","link":"https:\/\/digileaders.com\/the-full-blockchain-story\/","title":{"rendered":"The Full Blockchain Story"},"content":{"rendered":"

For those who studied a science throughout school, college and university\u200a\u2014\u200athis article follows the same principle; what was originally said isn\u2019t strictly true, some key technical details have been left out for simplicity.<\/p>\n

Let\u2019s begin with Bitcoin\u2019s Distributed Ledger Technology. In blockchain, it is easier computationally to maintain a record of all past transactions rather than displaying the current balance of an individual\u2019s wallet.<\/p>\n

Let\u2019s discuss an example. Assume the blockchain is three blocks long:<\/p>\n

Block Index:<\/h4>\n

0. The genesis block in which Bitcoin was first created.
\n1. The first transaction, 10 Bitcoins were sent to Alice.
\n2. The second transaction, 5 Bitcoins were sent to Bob.<\/p>\n

The current state of the blockchain is that Alice has 5 Bitcoin and Bob has 5 Bitcoin. However, this is read as:<\/p>\n

\u201cThe Genisis block sent 10 Bitcoin to Alice\u201d.<\/p>\n

\u201cAlice has 10 Bitcoin, sent 10 to Bob and sent 5 to Alice\u201d.<\/p>\n

\u201cBob has 5 Bitcoin\u201d.<\/p>\n

So, Bitcoin works in the sense that all transactions are actually linked together, you can see the chain of transactions from the genesis block to Alice, from Alice to Bob and Alice to Alice. Your transaction must be sent from a prior transaction in the chain and any change is sent back to yourself. This way all transactions are traceable and have a chain of public record.<\/p>\n

A great example of this can be seen in this recent, $1B transaction. Notice how the receiving address consists of multiple addresses? These are essentially where the parts of bitcoin came from to create the total of 6,044.48 BTC.<\/p>\n

\"Blockchain\"

Source: https:\/\/www.trustnodes.com\/2018\/02\/19\/unknown-investor-buys-billion-dollars-worth-bitcoin<\/p><\/div>\n

Next, we dissect the components of a block in more detail:<\/p>\n

1. The transaction:<\/h4>\n

How many Bitcoins are being sent
\nThe public key of the person receiving
\nThe transaction chain of where the prior bitcoin transaction has come from<\/p>\n

Update: There is no sent from address.<\/p>\n

2. The Block Header:<\/h4>\n

The time and date of the transactions.
\nThe block index.
\nThe hash<\/p>\n

The Hash has a little bit more going on than previously stated. Let\u2019s take a look under the bonnet. The first component is all of the transactions themselves, take this example with four transactions:<\/p>\n

\"Blockchain\"<\/a>

Source: https:\/\/dtrt.org\/posts\/blockchain-pruning-problems-and-solutions\/<\/p><\/div>\n

First, you hash the transactions.<\/p>\n

Second, you hash the pairs of the transactions.<\/p>\n

Next, you hash the next set of pairs.<\/p>\n

Then, you repeat this until there is only one hash left and for good measure\u2026 you guessed it, you hash it again. This completes the merkle root.<\/p>\n

Now, we can see in detail why even changing one detail, in say, transaction 3 will result in a beyond unrecognisable hash for the block header. It is almost infeasible to change that detail and match every single hash from that point up until the current block header. This is the trustless system and how we can rely on it.<\/p>\n

This information, complete with the previous article, enclosed below, should put you ahead of the majority of the population in terms of understanding how bitcoin\u2019s transactions and a basic blockchain work.<\/p>\n

To delve further from here, your next topic areas are Segregated Witness and the Lightning Network.<\/p>\n

\n

This article was originally published here<\/a> and was reposted with permission.<\/p>\n

 <\/p>\n

\"More<\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

For those who studied a science throughout school, college and university\u200a\u2014\u200athis article follows the same principle; what was originally said isn\u2019t strictly true, some key technical details have been left out for simplicity. Let\u2019s begin with Bitcoin\u2019s Distributed Ledger Technology. In blockchain, it is easier […]<\/p>\n","protected":false},"author":11,"featured_media":21767,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"class_list":["post-21721","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","region-newcastle","region-north-east","topic-fintech"],"acf":[],"yoast_head":"\nBlockchain - The Full Story<\/title>\n<meta name=\"description\" content=\"Let\u2019s begin with Bitcoin\u2019s Distributed Ledger Technology, in blockchain, it is easier computationally to maintain a record of all past transactions rather than displaying the current balance of an individual\u2019s wallet.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/digileaders.com\/the-full-blockchain-story\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Blockchain - The Full Story\" \/>\n<meta property=\"og:description\" content=\"Let\u2019s begin with Bitcoin\u2019s Distributed Ledger Technology, in blockchain, it is easier computationally to maintain a record of all past transactions rather than displaying the current balance of an individual\u2019s wallet.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/digileaders.com\/the-full-blockchain-story\/\" \/>\n<meta property=\"og:site_name\" content=\"Digital Leaders\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/digitalleadersprogramme\" \/>\n<meta property=\"article:published_time\" content=\"2018-02-23T14:07:18+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2019-05-08T13:44:13+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/digileaders.com\/wp-content\/uploads\/2018\/02\/block-chain-2850276_960_720-1.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"960\" \/>\n\t<meta property=\"og:image:height\" content=\"463\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"helena.larsen\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@DigiLeaders\" \/>\n<meta name=\"twitter:site\" content=\"@DigiLeaders\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"helena.larsen\" \/>\n\t<meta name=\"twitter:label2\" content=\"Estimated reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/\"},\"author\":{\"name\":\"helena.larsen\",\"@id\":\"https:\/\/digileaders.com\/#\/schema\/person\/2da837c2b8c9912d5c8e0c6ba7458c1e\"},\"headline\":\"The Full Blockchain Story\",\"datePublished\":\"2018-02-23T14:07:18+00:00\",\"dateModified\":\"2019-05-08T13:44:13+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/\"},\"wordCount\":546,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/digileaders.com\/#organization\"},\"image\":{\"@id\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/digileaders.com\/wp-content\/uploads\/2018\/02\/block-chain-2850276_960_720-1.jpg\",\"inLanguage\":\"en-GB\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/digileaders.com\/the-full-blockchain-story\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/\",\"url\":\"https:\/\/digileaders.com\/the-full-blockchain-story\/\",\"name\":\"Blockchain - 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