Blockchain explained (with analogy)

Blockchain explained (with analogy)

In the past few years, BitCoin and Blockchain technology has been really getting attention from a lot of people. Some understand it very well and some just have no idea what the hell is it.

I am no expert in this cryptocurrency industry but I think I do understands it enough and come up with a simple analogy.

It may not be the best explanation, but this is what I have in mind for a while.

The WhatsApp Group List Analogy

Imagine blockchain is like the "list" on WhatsApp group you are making.

For example, in my classmate WhatsApp group. We are required to make a list of people who would like to buy a textbook for Mathematics class.

As a person in charge of the list, I will start the list by giving out some notes up top and insert my name with indexed numbering.


As you can see, the list starts with just my name and some details about how many books do I want to purchase with indexes.

If there is anyone who would like to buy one will "update" the list by copying the previous list and add his name to it.


Now imagine at a given time, there are 3 people who "update" the list and come out with 3 different version of it.

Version 1 - from Irfan image.png

Version 2 - from Kumar image.png

Version 3 - from Jason image.png

This is where the problem occurs;

  • Which list does the next person need to fill in?
  • Which version is the current legit list?
  • Which list do I take as the main list?

For now, let's just imagine there is some kind of method the WhatsApp list problem was solved and we assume that the Version 1 list from Irfan is taken as the main list.

Kumar and Jason now will need to re-update the new Version 1 list by adding their names to it and everyone will be happy. The process of adding names and avoiding duplicates are continued until I decide to end it. Everyone will be able to see, edit, and update the list as long as it is attached to the main list.

How it is related to the blockchain?

From the analogy above, the way blockchain is analogized as the list in WhatsApp group is taking the list as the blockchain itself. One key feature of blockchain is that everyone in this world can see it to track everything.

Now instead of making a name list of people, replace it with the transactions made with BitCoin. Add a few rules about how people can edit it and we are set.

Rules of updating the "Blockchain list".

  1. To add the transactions made, each person needs to solve some cryptography problem first before their transactions are added to the list.
  2. If at any given moment there are multiple people trying to update the list, the first person who solves the problem will be added. Failed attempts need to solve the next problem in order to be able to update it.
  3. Everyone can keep track of the transactions made, everyone needs to agree on the details that have been added.

But there are more...

Of course, this analogy isn't perfect by any means because it doesn't cover BitCoin mining and many more that I may have not addressed. But this is the best analogy that I've come up with. I hope that this explanation does give you some insights and a little bit of understanding about Blockchain technology and how it works.

The least I can hope for if there's anything, this explanations will make you more interested to dig up more about Blockchain and BitCoin.

Thank you for your time to read this, appreciate it a lot. 😁

Some info about BitCoin mining, it is like a reward for the people who solve the problem which enables them to update the list.

Here are some videos that might help you understands better.

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