BlockShots: Blockchain Simplified

Signing is the process of associating user’s identity with information that is originating from the user.

In this episode, we discuss digital and cryptographic signing and how it is used in blockchains.

Hashing is the process of deriving fixed-length strings from arbitrary-length data. It is generally used to represent data in a more compact and consistent format. In this episode we discuss the process of cryptographic hashing, hash functions and their characteristics. We also discuss the usage of hashing in blockchains and merkle trees.

Transactions are small bundles of information that are used to propose updates to the state of the blockchain. Users sign and submit transactions to one or more nodes, and based on their validity, they are executed by all other nodes to update the state of the blockchain.

Transactions are grouped into blocks. Blocks are then processed one-at-a-time to execute all included transactions together.

A blockchain has several core functions like storage, networking, consensus, etc. All these are coded and packaged together in the blockchain node software. This software is then distributed to the users willing to participate in the blockchain validation or mining process.

Blockchain node software running on a physical or virtual machine and accepting connections is a blockchain node.

When several nodes connect with each other and exchange information like blocks and transactions, we get a blockchain network. So, in essence, a network is a collection of interconnected nodes.

In the context of blockchains, consensus is the agreement on the state of the blockchain among all the nodes in a network. The main area where consensus is needed is the order of transactions, within a block. If all nodes could agree on the order in which the transactions happened, then they would individually arrive at the same state after processing the respective blocks.

Welcome to BlockShots! In this first episode, the topic is introduction to blockchain with a basic example.

Blockchain is a system that allows two or more mutually unknown parties to reach an agreement without middlemen. The agreement could be on the state of any kind of data: Fintech — accounts and balances (like in Bitcoin). There is no single point of control and failure in a blockchain.