Blockchain explained in 250 words or less.
Blockchain explained in 250 words or less.

By MadMaxx | Psycho Crypto | 1 Feb 2020


Straight to the point.

It's really straightforward.

Jack pays Jim for the salad he ate yesterday.

He uses his private keys to his bitcoin wallet to initiate the transaction. In this case, the transaction is a change in ownership of the currency.

Nothing else changes hands throughout this process.

The bitcoin network(we know them as miners) gets word of this transaction using their extremely powerful computers.

They run their computers at full blast using a trial and error approach that fills in missing information from recent transactions.

This process creates a puzzle that has just one solution.

The first miner to fill in the details of this puzzle correctly gets the rights to a bundle of all the recent transactions on the network. This bundle is called a block.

Then other miners verify that the block is 100% error free and that the transaction in the block meets all the necessary requirements for it to be deemed valid.

This block is then added to an even larger block containing all previous transactions. This is known as the public ledger.(or Chain)

The miner who put the block together gets some Bitcoin for his efforts.

These blocks are limited to 1MB of data.

All the blocks are linked and must be correct all the time.

Also, the difficulty of that puzzle changes every now and then.

That's all. That's all the fuss is about.

Now you know.

 

 


MadMaxx
MadMaxx

Shitcoin flipper. Derivatives and options trader. Bitcoin and Ethereum futures and inverse swap contracts. Professional trader. Never financial advice.


Psycho Crypto
Psycho Crypto

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