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Fixed minor grammatical issues (#27065)

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MattSchwartzkopf
2018-12-17 21:39:44 -05:00
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@ -7,24 +7,24 @@ title: Blockchain
>
> --Bettina Warburg<sup>1</sup>
Blockchain is often associated with Bitcoin and other cryptocurrencies, but they are not the same thing. Bitcoin was the first to implement the concept of the Blockchain. The structure of a blockchain, a growing list of records, can be applied to many other fields such as digital identity, supply chain and even [democracy](https://www.democracy.earth/).
Blockchain is often associated with Bitcoin and other cryptocurrencies, but they are not the same thing. Bitcoin was the first to implement the concept of the Blockchain. The structure of a blockchain, a growing list of records, can be applied to many other fields such as digital identity, supply chain, and even [democracy](https://www.democracy.earth/).
A blockchain is built out of a combination of two different “hash-based data structures” (Narayanan, Bonneau, Felten, Miller, & Goldfeder, 2016, p. 64), a hash chain of blocks and a Merkle tree. “In short, the blockchain is a network and a database; it has rules and built-in security; and it maintains internal integrity and its own history” (Depository Trust and Clearing Corporation, 2016, p. 7). In the chain, each block has a pointer to the previous block as well as a pointer to its Merkle tree of transactions. A Merkle tree, sometimes called a hash tree, is a type of tree where each node that has at least one child is marked with a hash of its own children.
Even though blockchain can be applied to a big range of problems, it is not the solution to everything. This technology is usually used to solve problems where the parties don't trust each other.
A third party is usually needed to validate trust relationships. In the most common example, which is the banking system, a trusted authority is needed, such as a bank, to intermediate transactions, manage accounts, verify balances, and validate transfers. Blockchain then, comes in this case to replace the regulatory or central authority. In the case of cryptocurrencies, it replaces the figure of the bank, doing all the validations and guaranteeing the security and veracity of the transactions.
A third party is usually needed to validate trust relationships. In the most common example, which is the banking system, a trusted authority is needed, such as a bank, to intermediate transactions, manage accounts, verify balances, and validate transfers. Blockchain then comes in this case to replace the regulatory or central authority. In the case of cryptocurrencies, it replaces the figure of the bank, doing all the validations and guaranteeing the security and veracity of the transactions.
For this reason Blockchain is also known as **"The Trust Protocol"**.
For this reason, Blockchain is also known as **"The Trust Protocol"**.
## History
The first work on a cryptographically secured chain of blocks was described in 1991 by Stuart Haber and W. Scott Stornetta. They wanted to implement a system where documents' timestamps could not be tampered with or backdated. In 1992, Bayer, Haber and Stornetta incorporated Merkle trees to the design, which improved its efficiency by allowing several documents to be collated into one block.
The first work on a cryptographically secured chain of blocks was described in 1991 by Stuart Haber and W. Scott Stornetta. They wanted to implement a system where documents' timestamps could not be tampered with or backdated. In 1992, Bayer, Haber, and Stornetta incorporated Merkle trees to the design, which improved its efficiency by allowing several documents to be collated into one block.
The first blockchain was conceptualized by a person (or group of people) known as Satoshi Nakamoto in 2008. It was implemented the following year by Nakamoto as a core component of the cryptocurrency bitcoin, where it serves as the public ledger for all transactions on the network. The identity of Satoshi Nakamoto is not known, with some claming him to be an Australian or Japanese man.
In August 2014, the bitcoin blockchain file size, containing records of all transactions that have occurred on the network, reached 20 GB (gigabytes). In January 2015, the size had grown to almost 30 GB, and from January 2016 to January 2017, the bitcoin blockchain grew from 50 GB to 100 GB in size. Furthermore, Nakamoto introduced the concept of proof of work to ensure a more decentralised trust in the records' security.
In August 2014, the bitcoin blockchain file size, containing records of all transactions that have occurred on the network, reached 20 GB (gigabytes). In January 2015, the size had grown to almost 30 GB, and from January 2016 to January 2017, the bitcoin blockchain grew from 50 GB to 100 GB in size. Furthermore, Nakamoto introduced the concept of proof of work to ensure a more decentralized trust in the records' security.
The words block and chain were used separately in Satoshi Nakamoto's original paper, but were eventually popularized as a single word, blockchain, by 2016. The term blockchain 2.0 refers to new applications of the distributed blockchain database, first emerging in 2014. The Economist described one implementation of this second-generation programmable blockchain as coming with "a programming language that allows users to write more sophisticated smart contracts, thus creating invoices that pay themselves when a shipment arrives or share certificates which automatically send their owners dividends if profits reach a certain level."
The words block and chain were used separately in Satoshi Nakamoto's original paper but were eventually popularized as a single word, blockchain, by 2016. The term blockchain 2.0 refers to new applications of the distributed blockchain database, first emerging in 2014. The Economist described one implementation of this second-generation programmable blockchain as coming with "a programming language that allows users to write more sophisticated smart contracts, thus creating invoices that pay themselves when a shipment arrives or share certificates which automatically send their owners dividends if profits reach a certain level."
As of 2016, blockchain 2.0 implementations continue to require an off-chain oracle to access any "external data or events based on time or market conditions to interact with the blockchain."