We explain blockchain in an elevator ride

Do you know what blockchain is? Not
really. Do you know what Bitcoin is? Sort
of. It’s digital money that people use
computers to mine and it’s worth heaps
and it’s really unstable and it might be
the way of the future and I think
bitcoins are made with blockchain. Err.. I’m going to ask a computer scientist to
break it down for me in a time it takes
an elevator to go from the bottom of the
building up to the top and then all the
way back down, which kind of looks like a
long time but I don’t think it is going
to be because what is blockchain? Let’s
go see.
Oh, I could have gone!
Hi Richard. Hey Rad. So you’re ready to
do this? Yeah challenge accepted. Are you
excited to teach me everything you know?
You’re making me tense. It’s only one elevator
trip. What’s the worst that could happen?
Bruce Willis. Ready?
What is blockchain? Blockchain is a way
of taking information, electronic
information, and making it unchangeable
so people can’t tamper with it in the
future. But it’s related to money isn’t
it? It’s often used for money, for crypto-
currency like Bitcoin, to keep a track of
all the transactions that have happened
so people can’t lie about them later on.
Okay so the Bitcoin is like the cash
and the blockchain is the ledger? It’s a
ledger exactly right. Sso why would people
pick cryptocurrency over other forms of
money? Mainly it’s because it doesn’t
need any trust. You don’t need to trust
third parties like PayPal. They actually
just passed around to everyone. Multiple
people have it so if you try and change
it there’s multiple other guys. Yeah yeah
okay and what is a blockchain like what
block and chain? Yeah. Yeah so the
block is where you store the
transactions so you can think of it as
like, I don’t know, the transactions are
lining up outside. There’s a taxi coming. The first taxi that pulls all jumps on
– that’s the block. It holds all the
transactions. Yep. To create a block you
need to solve a puzzle. We’re halfway, at the top. Are you halfway through explaining?
Yeah definitely. The puzzles is the
interesting bit. All right so what are
the puzzles? When the blockchain protocol was set up initially they designed a
schema – a way of generating an infinite
sequence of puzzles. Each puzzle takes
about ten – you can’t shut the door! Each puzzle takes about ten minutes to solve with lots of
computing power. Everyone’s working
flat-out to solve them because the person
that solves the puzzle gets to make the
next block and every time you make a
block you get paid some money. And no one
owns the puzzle? No one owns a puzzle the
puzzle is just the rules of maths. No one
knows the answer until you find it. Okay.
And the neat thing about it is each
puzzle relates to the previous solution,
to the previous block. So the blocks are
tied together in that way.
That’s what gives us a chain. The blocks
are all linked together by the ways the
puzzles are structured so if you wanted
to change your block later, you’d
actually have to change all the ones
after it because all the puzzles would
be different. That makes it…
it’s hard to frauder.
So is this the best way to be having
money now, in 2019? So it’s good because you don’t
have to trust the government or anyone
like that but it’s risky because if
something goes wrong then of course
everything’s lost. So why are we doing it
then? Can it be used for anything else? There’s so much hype I’m really glad you
asked. This is a 187 things that people claim it can be used
for other than cryptocurrencies. Cancer!
Yeah it solves cancer, it solves global warming, it
solves AIDS, and also online sales of
classic Japanese domestic cars.
Is any of this real? This is the problem it’s great for cryptocurrency it’s not clear that it’s
good for anything else
but everyone wants to use it so everyone
talks about it all the time. Well this is
my floor so I guess I’ll go read this.
Thank you so much Richard. A real pleasure Rad. See you round. Except what do I do now?
So I think I know what blockchain is now. Basically it’s a ledger where there are blocks
that are the carriers for transactions
and you get a block by solving a
mathematical puzzle and when you create
the block you get some money. So you’re
paid for having the block which carries
the transactions and then that block
gets put into a chain and they’re all
linked together so that you can’t fake
it. You have to have the previous block
in the chain to be able to have the new
block and that’s what makes it safe. But
it’s not really safe – this is the really
scary part – if everyone just stops
working on it it will cease to exist
and that’ll be it. It’s crazy so I’m
really interested to see if any of this
list comes true particularly whether it
can solve a whole lot of problems?
Hey, I hope you enjoyed this
little shortcut to smartness. Richard also actually has a lot of videos up on YouTube of his lectures about computer
science and these are proper lectures
you can basically get a uni degree for
free so if you want to see any of those
we will put the link in the description
and you can go check it out. If there’s
any big topics that you would like us to
make elevator sized and then let us know
in the comments below and you know I’ll
see what I can do for you. Thanks for

11 thoughts on “We explain blockchain in an elevator ride

  1. I taught Satoshi Nakamoto English in Yaesu, Tokyo back in 2006/07.
    Worked on his paper correcting plurals, articles, prepositions and the likes.
    He offered me bitcoins before anyone even knew what they were and I told him that I barely trusted my credit cards online let alone an entire currency.
    I guess decisions like that are the reason I'm the man I am today.

  2. It needs secure storage so it can't be lost.
    It needs trust.
    It needs guaranteed value against coffee, fuel, houses and airfares.

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