Blockchain explained simply.

You can think of the blockchain as a kind of digital notebook. Each new transaction is recorded in it. It is public, and everyone can view the recorded transactions. The notebook is continuously copied and sent to participating computers. This prevents any single party from changing the notebook. Changes can't be directly made, they can only be proposed. They are only implemented once the majority of participating computers agree.

The entire history of changes is also visible to everyone in the notebook. Because participating computers verify the blockchain, there is no need for a central authority to oversee it. Since there are many individual computers and no central authority, the blockchain is decentralized.

By the way, the new entries in the notebook—or on the blockchain—are grouped together in a "block." These blocks are then added to the existing transactions in the notebook. Instead of thinking of the existing transactions as a notebook, you can now imagine them as a series of blocks connected together. Hence the name "blockchain".

Why the blockchain is revolutionary

The blockchain solves a fundamental problem: the issue of "trust" in a digital world. With blockchain, information can be securely, transparently, and quickly stored and transferred without the need for a central intermediary. This not only saves time and money but also reduces the risk of fraud and abuse. By eliminating the reliance on a trusted third party (such as a bank or government), blockchain enables peer-to-peer transactions where all parties involved can be confident that the data is accurate, unaltered, and verifiable. This increases trust in the system and opens up new possibilities for digital interactions across various sectors, from finance to supply chain management and beyond.

Let's illustrate this with the example of a money transfer. Imagine you're buying a chair on an online marketplace. Since the seller doesn't live nearby, you transfer the money to him electronically.

For this transaction, you need an intermediary, a third party both of you trust. In this case, it's a bank. The bank documents and oversees the transaction, ensuring that the payment reaches the seller and is correctly deducted from your account. The bank charges a fee for this service. It operates centrally and could, in the worst case, go bankrupt. Moreover, centralized systems are generally easier to manipulate.

Alternatively, you could pay for the chair with a cryptocurrency such as Bitcoin (assuming, of course, the seller accepts it and has a wallet to receive the Bitcoin transfer). In this case, you eliminate the bank as the central intermediary. The role of the intermediary is now taken over by the many participating computers in the network. This makes the same transaction more direct, faster, safer, and in some cases, cheaper.

It should be noted that cryptocurrencies—except for

Cryptocurrencies like Bitcoin are the most well-known examples based on blockchain technology, but they are just one of many possible applications. Blockchain is highly versatile and could change our lives in significant ways.

Elections: For example, blockchain could provide a secure and transparent system for online elections, where votes are recorded securely and cannot be manipulated. This would enhance trust in the election process, especially in areas concerned with election fraud.

Supply chain: Blockchain can also be used in supply chain management, allowing us to trace the origin of products from source to end consumer. This increases transparency and helps prevent fraud, such as the sale of counterfeit goods, ensuring that products are authentic and ethically sourced.

Ownership: In the context of property ownership, blockchain can be used to create a land registry that securely records ownership. This would prevent land expropriations and protect property rights. While this may not be a significant issue in some countries, it could be crucial in regions where trust in the state is weaker.

The transformative aspect of blockchain lies in its ability to eliminate intermediaries. From platforms like Airbnb and ride-hailing services like Uber to notaries and banks, blockchain could streamline processes, reduce costs, and enhance security across many industries.

It is likely that blockchain will gain importance beyond the financial world. No one knows exactly how the technology will evolve and spread, but one thing is certain: With its ability to store data immutably and conduct transactions without intermediaries, it has the potential to revolutionize many industries and processes. We are witnessing the beginning of a development whose potential has not yet been fully realized. Will it lead humanity to a better future?