Blockchain is the lowest technology of digital currency. It ensures that every Internet user can reach a consensus without mutual trust.

Initial stage

Imagination of blockchain technology It dates back to 1991. In order to ensure that the timestamp file cannot be traced and tampered with, two scientists at the time, Stuart Haber and W. Scott Stornetta, launched a practical computing solution.

The system uses a blockchain encryption chain to store timestamp files, and in 1992, Merkle trees were also incorporated into the system, which combines multiple documents The new technology grouped into one block greatly improves efficiency. Unfortunately, no one cared about this technology and it was slowly abandoned. The patent also expired in 2004, four years before Bitcoin was born.

Reusable Proof of Work (RPoW)

In 2004, computer scientist and cryptography enthusiast Hal Finney (Harold Thomas Finney II) launched a system called RPoW, a reusable proof-of-work mechanism.

The system operates by receiving a non-exchangeable or non-fungible proof-of-work token based on Hashcash, and at the same time, creates a token that can be transferred between any users. RSA algorithm token.

RPoW solves the problem of double spending by allowing currency holders to register accounts on a completely trustworthy server. The server is designed to allow users around the world to verify its correctness and integrity at any time.

RPoW can be said to be an early prototype of the blockchain and an important beginning in the history of digital currency.

Bitcoin Network

At the end of 2008, a man named Satoshi Nakamoto ( Satoshi Nakamoto released a white paper and introduced a decentralized, peer-to-peer electronic cash system - Bitcoin.

Compared with the trusted hardware computing function of RPoW, Bitcoin uses the hashcash workload proof algorithm to track and verify transactions through a decentralized point-to-point protocol to prevent Double payment. To put it simply, Bitcoin is a "mining" reward for each miner under the workload proof mechanism, which is then verified by decentralized nodes in the entire network.

On January 3, 2009, Bitcoin was born. The first Bitcoin was "mined" by Satoshi Nakamoto, and he received a reward of 50 Bitcoins. . The first person to receive Bitcoin was Hal Finney. He received 10 Bitcoins from Satoshi Nakamoto on January 12, 2009. This was the world's first Bitcoin transfer.

Ethereum

In 2013, a programmer named Vitalik Buterin, He is also the co-founder of Bitcoin Magazine and said that Bitcoin needs a scripting language to build decentralized applications. Due to the failure to gain recognition within the Bitcoin community, Vitalik began the research and development of a new distributed computing platform based on blockchain technology, which is Ethereum. The scripting function supported by Ethereum is It's called a smart contract.

Smart contracts are programs or scripts deployed and run on the Ethereum blockchain. For example, they can be used to conduct a transaction under certain conditions. Smart contracts are written in a specific programming language and compiled into byte code. These smart contracts can be read and executed by a decentralized, Turing-complete Ethereum Virtual Machine (EVM).

Developers can also create and publish new applications on the Ethereum blockchain, which are often called decentralized applications (DApps). Currently, there are hundreds of decentralized applications running on the Ethereum blockchain, including social platforms, online gambling and financial exchanges, etc.

The digital currency of Ethereum is called Ether, which can be transferred between different accounts. Ether is usually used to pay for the computing power required to execute smart contracts.

Today, blockchain technology has received a lot of attention from mainstream media and has been applied to many real-life scenarios besides digital currency. For more information on blockchain and related industries, stay tuned for our other Binance Academy video content.