Demystifying Blockchain: Basic Introduction for Non-Tech Women

Join me as we unravel this fascinating concept together. I don’t mean to take you back to your accounting class, but let’s talk about ledgers. Ledgers are at the foundation of an intriguing concept that’s reshaping the way we think about technology and our daily lives: blockchain.

The Heart of Financial Institutions

Now, you might wonder, what does a ledger have to do with blockchain? Well, think of a ledger as the heartbeat of any financial institution, much like your favourite bank. It started out as a big book where every financial move was recorded, from deposits to withdrawals, and only top banking officers had access to this ledger. You can picture it as a financial diary.

In traditional banking, these ledgers are centralised. The bank holds the record of all transactions. They’re the gatekeepers of your financial history.

This approach can lead to inefficiencies, delays, and a lack of transparency. Remember the time you transferred money, but it never went through, and you were debited? Only the bank could trace where the money went because they had access to the behind-the-scenes records. This is the foundational principle of blockchain.

The Blockchain Ledger: A Decentralised Wonder

Imagine this ledger that’s not locked within a single bank but is accessible to everyone, free from the control of a single institution. This is the reality of the world of blockchain. It’s a digital ledger shared across the world. Every entry in this ledger is like a piece of a puzzle, known as a “block.” When one block is filled, a new one seamlessly takes its place, securely linked together, forming what we call the “blockchain.” It’s a transparent system where anyone can see, and most importantly, no one can secretly tamper with or erase entries.

How does this work?

DLTs (Distributed Ledger Technologies) are super-secure digital ledgers. In this digital diary, everything is locked with special keys and secret signatures. Once you write something down, it’s almost like etching it in stone. Nobody can change it, and that’s because the ledger is governed by special computer rules.

Now, the exciting part is that there are copies of this ledger on many computers, not just one. These computers are like your friends, and each has its own copy. If someone tries to mess with one copy, all your other friends will know because they have their copies, too.