Blockchain is not only a cryptocurrency — how block chains appeared

31.08.2022 |

For article about-technology blockchain

Blockchain is a chain of blocks containing information, built according to certain rules, having a continuous character. In simple terms, the blockchain is similar to the electronic version of an ordinary magazine, which keeps records of certain values, products or materials.

There are two main branches of the block chain: centralized and decentralized. The implementation of the latter is clearly shown by the example of bitcoin. In fact, it was the first cryptocurrency that became an example of the use of blockchain in practice. However, the use of this technology is not limited to digital assets only.

The history of blockchain creation

The creators of the blockchain idea itself can be called Stuart Haber and Scott Stornetta, two specialists in applied cryptography from New Jersey. 30 years ago, they offered a scheme for setting timestamps on digital documents, which became the basis of the idea of bitcoin.

Initially, the technology was designed to confirm the authorship of documents. A common practice at that time was to send a letter to your name. Thus, the author had the opportunity to prove the time of creation of the original source by the postmark. Some writers still use this method before sending the manuscript to the publisher. Mail is much cheaper than notarization.

To solve this problem in the field of electronic documents, a cryptographic block chain was proposed. A sequence of hashed data was built in it, which allowed not only to put a timestamp on the document, but also to protect the latter from making changes.

What problems does blockchain solve?

It would seem that confirmation of authorship is solved simply — it is enough to create a body that would accept documents from the authors, keep a copy at home, and put the date of the appeal on the original. But in this case there are a number of fundamental problems:

  • privacy — anyone who has access to the repository can read the document;
  • trust is the second most important factor, by bribing an employee, you can change the date on the document, and replace the copy;
  • low reliability — the human factor can make an error in the information about the time of treatment, and an elementary fire can completely destroy copies;
  • low bandwidth — processing of each digital document requires the efforts of employees and the larger the amount of information, the more time will be spent, and archive storage may require large amounts of memory.

The solution to these problems was found quickly, all but trust. It is enough to store in the electronic catalog not a complete copy of the document, but only a hash amount. Thus, document processing eliminated the need for manual initial compliance verification, access to information was hidden, and the checksum occupies the same place for any volume of the document.

Trust is the only obstacle to solving all problems. To create a secure confirmation system, with unconditional trust, it was necessary to control the “certification center”. But then there was a need to create a trusted controller, and its activities would also have to be monitored, which led to an endless chain of verifiers. At that moment, it was proposed to appoint not one body, but a whole network of independent inspectors as the first controller.

This served as the basis of the modern idea of the blockchain.

The first application of blockchain in the real world

If the idea of a decentralized block chain with a hash sum of documents was published in 1991, then it took another three years to implement the idea. In 1994, a service for hashing documents and putting down the creation time appeared — “Surety”. After all manipulations, the control value with a timestamp is sent to a database called AbsoluteProof. That’s how the block chain appeared.

At that time, the Internet was not yet so developed, not everyone had computers, so the question of trusted, distributed storage arose. A very unusual solution was found. The New York Times newspaper, which was read by millions of Americans in the morning, came to the rescue. Since 1995, hash sums of all documents added over the past week have been published in the “notifications about found and lost items” section.

Only a few issues remained unresolved at that moment. It was necessary to develop ways to stimulate computing and storage of the entire database by a large number of devices. Determine the method of reaching consensus and come to an agreement on the required minimum of calculations.

The next time blockchain technology was resorted to was only in 2009, when Satoshi Nakomoto published the Bitcoin White Paper. It was he who was able to show the world that the development of technology can give an impetus to something new. At this moment, Vitalik Buterin, the developer of Ethereum, expressed the opinion that hackers would have to work hard breaking the AbsoluteProof block chain. To do this, it would be necessary not only to find all the surviving copies of newspapers of that time, and replace them with new ones with changed information, but also to bring paper and paints to such a state as if they had been lying for more than 25 years. Thus, Stuart Haber and Scott Stornetta managed to create a technology that, after almost 20 years, was able to turn the world around, and forced a new look at many problems that need reliable confirmation.