What is Blockchain? – Sndbox Incubator Cohort 2 004
What is Blockchain?
Now CritDay has been introduced, the aims have been set for Cohort 2 and the first assignment has been submitted, let’s start to look at blockchain technology specifically. Next month the focus will be on delving deeper into Steem and the associated DApps, ahead of this I thought it would be beneficial to learn more about the general environment Steem is part of – Blockchain.
This post will share my findings and shed light on the world of blockchain. Over the past few years terms like crypto, blockchain and Bitcoin have started to enter the mainstream conversation. These may be terms you are aware of, you have pre-judgements of or perhaps you have decided to ignore the “hype”.
Through this post and over the coming months, CritDay aims to explore this topic further. Setting this foundation of knowledge will be important for progressing forward with CritDay’s exploration of blockchain and how it can and will impact architecture, our cities and the people within them.
What is Blockchain
If this is the first time you’ve ever heard the term blockchain, then please see this post as a starting point. As much as I would like this post to explain the principles to you in full, the concept can take a while to get your head around. In my opinion this is because blockchain technology flips traditional methods of operation (financial, data, information sharing) on their head. If you already have a basic knowledge of blockchain then hopefully this will make things a little clearer for you.
In the simplest terms think of blockchain as a database of information. Unlike traditional databases which are generally created, maintained and stored in one location by one organisation, blockchain technology distributes information across a network of individual computers. These individual computers form a peer-to-peer network and are responsible for authorising transactions of information.
Image 1. A diagram of traditional networks vs. distributed networks.
The process of how blockchain technology functions has been illustrated in the diagram below. When broken down to basics it follows six steps:
1. A transaction is requested from one party to another.
2. This transaction is broadcast to the peer-to-peer network.
3. The network collectively approves the transaction.
4. This information is then grouped with the information of other transactions to form a block.
5. The block is then added to a chain – hence the term blockchain.
6. The transaction is then complete.
Image 2. A diagram of the blockchain process.
What’s so exciting about blockchain?
Blockchain technology has a set of strong principles at its core which offers potential for it to impact traditional processes across all industries, including architecture and construction. Decentralisation through a peer-to-peer system increases the resilience of the networks as there is not one point of failure like traditional systems. These networks are more secure, distributed information can be encrypted through the use of private keys. Information can be accessed and transferred instantly around the world. These characteristics will attract adopters of the technology over the coming decades.
What is Crypto
Blockchain is only part of the story, the other being Crypto (cryptocurrency). If blockchain is the spine then I would suggest cryptocurrency forms the ribs – possibly not the best analogy but let’s go with it.
Brought back to basics cryptocurrency applies the principles of decentralisation, security and transparency of blockchain to a monetary setting. The transactions mentioned above when describing blockchain become financial transactions. This cuts out the middlemen (banks), allowing money to be sent almost immediately around the world person to person. Although cryptocurrency is not the focus of CritDay, it is part of the overall environment which the platform is exploring through this series (and beyond).
There are an ever growing number of cryptocurrencies, or “coins”. At the time of writing this CoinMarketCap (https://coinmarketcap.com/) states there are 1842! Most of these you and I will not be aware of, however over the past few years several coins have gained notoriety. By far the most popular coin is BitCoin, which initiated the movement. Other notable coins are Ethereum, Ripple, Litecoin and of course Steem!
Conclusion and Thoughts
Architecture has changed dramatically over the last few decades, with enhancements in materials the use of computer aided design and more recently BIM. These developments have changed the style of buildings, the way users inhabit them and of course the design process. It seems almost inevitable that as blockchain technology stablises and continues to develop it will become part of the architectural process. CritDay will continue to explore this shift during cohort 2 (and beyond), and aims to help lead the way in developing the use of blockchain technology in architecture.
If you are interested in learning more about Cryptocurrency generally then this is a great place to start. The article is easy to follow and understand.
An online database of cryptocurrencies.
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