Blockchain & Cryptocurrencies

In Computer Science, a Blockchain is a digital record of transactions, similar to a database. But unlike a database, which uses centralized storage for data, a blockchain uses decentralized storage for its data. Also traditional databases need a database administrator to manage the stored data but in a typical blockchain there are no database administrators. The name blockchain comes from its structure, in which individual records, called blocks, are cryptographically linked together in single list, called a chain. Blockchains are used for recording transactions made with cryptocurrencies, such as Bitcoin, and have many other applications. Each block contains a cryptographic hash of the previous block, with a timestamp, and transaction data, generally represented as a Merkle Tree, which is a data structure that is used in computer science applications. By design, a blockchain is resistant to modification of its data, unlike traditional databases. This is because once recorded, the data in any given block, cannot be altered retroactively without alteration of all subsequent blocks. The Bitcoin blockchain was invented by a person, who goes by the name of Satoshi Nakamoto, in 2008. The identity of Satoshi Nakamoto remains unknown to date. The invention of Bitcoin, and its blockchain, made it the first digital currency to solve the double-spend problem and the issue of, not needing of a trusted authority or central server to validate digital ledger transactions. While Bitcoin was the first cryptocurrency, there have been many more new and better blockchains and cryptocurrencies that have been created, all derived from the foundation of the Bitcoin whitepaper. These new cryptocurrencies are called alterative coins or "Altcoins".  Bitcoin and these altcoins have ushered in a new Internet revolution, called the "Internet of Value".

A copy of the bitcoin core blockchain can be downloaded, installed and ran on any computer in the world, thus making it a truly distributed ledger, https://bitcoin.org/en/download.

Below is a graphic of the Bitcoin Blockchain Structure. The more blocks added to the Bitcoin blockchain structure the more difficult, or impossible, it is to hack the entire blockchain. Albeit, there is a hack technique called the 51% attack. This attack refers to an attack, performed on proof-of-work blockchains such as Bitcoin, in which a group of miners who control more than 50% of the network's mining hash rate or computing power can theoretically hack, reverse or manipulate a blocks transactions. The results are as such, that an attack can prevent new transactions from gaining confirmation, the attacker could also halt payments between some or all users, they can reverse transactions that were completed while they were in control of the network, meaning they could double-spend coins. But they would almost certainly not be able to create any new coins or alter old blocks in the chain. Therefore, a 51% attack does not affect the entire blockchain just the block in which was attacked. The original "genesis" block or block 1, up until the prior attacked block would not been susceptible during a 51% attack.

Cryptocurrency is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a digital ledger called the blockchain. A blockchain is a form of computerized database, that uses strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership. You can say that cryptocurrencies are "born from blockchains". Bitcoin was the first cryptocurrency blockchain to be created. Other cryptocurrencies, called Altcoins, have been developed over the years, in part which have some underlining technology that was based on bitcoins original design. For the most part, these newer Altcoins have verify different and better innovations than its predecessor, Bitcoin. 

Coins versus Tokens

These terms are used interchangeable when reading about Crypto but these are not the same thing and have important distinctions. Cryptocurrencies that are coins have their own blockchains, for example, Bitcoin, Ethereum, XRP, Cardano, Tron and VeChain to name a few. In contrast, token cryptocurrencies that do not have their own blockchain utilize other coins blockchains, for example Basic Attention Token (BAT) which runs on the Ethereum blockchain. These are considered ERC-20 tokens and abide by the Ethereum blockchains ERC standards. Ethereum has its own native coin or cryptocurrency called "Ether". Binance, which is a competing blockchain to the Ethereum network,  has what we call a "dual chain" architecture, the Binance Smart Chain (BSC) and the the Binance Chain. These two blockchains also have token standards, BEP20 for BSC and BEP2 for the Binance chain. Binance also has its own native cryptocurrency coin, called "BNB".

Centralized Exchanges custody crypto wallet, but really what it means is the Exchange holds and owns your private keys.  There is a saying in the crypto world, "not your keys not your crypto". A examples of Centralized Exchanges are Coinbase, Kraken, Gemini and Robinhood. These exchanges provide ease of use service to users who want to buy, sell, hold crypto currencies and/or digital assets. 

Below are links for the Coinbase Exchange. This exchanges will get you on your way to start understanding how to purchase cryptocurrency from these centralized exchanges. 

Coinbase Exchange:

Android: https://coinbase.com/join/smith_a6p2?src=android-link    

Apple iOS: https://coinbase.com/join/smith_1pww?src=ios-link    

Decentralized Exchanges or DEX, are just that an exchange that is not owned by any centralized company but more of a network on a blockchain that enables you to custody your own crypto wallet, private keys, so you can buy, sell and hold crypto. Some examples of DEX are SushiSwap, Uniswap, PancakeSwap, Curve.fi, DeversiFi, Changelly, KyberSwap, BisQ, WavesDEX, Stellarterm   

Both types of exchanges have their advantage and disadvantages, for beginners Centralized Exchanges are your best bet, they are easy to use and allows you to gain knowledge and get access to certain crypto currencies and/or digital assets. After you become versed in the world of crypto, a DEX, will provide you greater personal security of your crypto as well as provide many more  options that most centralized exchanges do not yet offer, such as yield farming, where you can gain interest on your crypto by loaning it out, with very little risk.