The History of Blockchain: From Books to Digital Data Logs
If we assume that the word first appeared during the creation of the world, then after it the need arose to write down this word so as not to forget. We tell you what the first data collection and storage systems were like and how the search for a simple and secure technology for processing, exchanging and storing information ended.
First data registries
The history of the blockchain begins long before the appearance of the first computers. In the Jewish scriptures, the first mentions of the earthen servant of man, the Golem, were noticed. Modern researchers easily guessed in this legend a prophetic prediction about the appearance of robots long before Isaac Asimov. At that time, the first data registers already existed. They were registers of birth and other lists of records of people’s activities. Where everything that should be recorded and systematized was recorded: from birth, buying a cow and mortgaging a house for debts, and until the death of each individual person.
In the XIII-XVI centuries, in the territory of the present, such a phenomenon as a population census has recently appeared. For this process, “scribe books" were used. Another “historical ancestor of the blockchain” can be considered Orthodox metric books. In the 18th century, recently, such books kept records of births, deaths, and marriages.
It is also known that in Russia it was customary to transmit the most intimate knowledge “by word of mouth”, but since our lips were never “touched” by this knowledge of the knowledge of our ancestors, it is easy to conclude that the system of oral transmission and storage of information has not justified itself and is imperfect, unreliable and fragile. And if you had a chance to play “Spoiled Phone” as a child, then there is no need to talk about how the word is distorted, which the participants in the game pass from mouth to mouth.
Structuring and optimization
With the advent of computer technology, data began to be entered into tables. With the spread of the Internet, tables have become more functional. Later, external hard drives are used to store data. What’s next? Technology has stepped into the clouds. Cloud storage has made the life of users easier and more airy, allowing information to be stored on cloud servers. But it still wasn’t enough.
But all this has not yet solved the issues of security of financial transactions, and data archiving without the ability to make changes after the fact. Let’s not forget that all these processes were still influenced by the human factor (probability of errors, pressure from third parties, etc.). Responsibility for the security and safety of registries, despite the development of technology, was still assigned to specific officials.
Time passed, information accumulated, data became more, as well as operations performed with them. Of course, subscriptions to city newspapers and magazines in printed form are still preserved in large city libraries. Similarly, there are archives of documents that are now being digitized for convenience. But this is all about archival information, but how to work with the data streams that are coming in every day right now?
The history of the blockchain: the technical side of the issue
Let us now turn to the less abstract prerequisites of the blockchain. What does data optimization look like from a technical point of view?
About 30 years ago, developers realized that it is easier to work with data if it is collected in blocks. At the same time, a technology appeared that made it easier to work with blocks – connected time stamps.
This is where hash functions come in handy. They were just the element that now links transactions into convenient blocks.
But that wasn’t enough. Convenient doesn’t mean safe. To prevent the nodes from “falling” under the influence of various factors, distributed computing was successfully applied.
The history of the blockchain is remarkable in that the further the developers plunged into the progress of technology, the more obvious the fact became – the blockchain system is much larger and more functional than it was initially imagined. And the scope of this technology is very diverse.
Education, hiring, construction, medicine, services, banking, etc. The technology is universal. But the first blockchain was created for a digital currency – bitcoin. Some users still do not understand the difference between bitcoin and blockchain. But these are fundamentally different technologies.
The history of the blockchain: who laid the "first stone" in the development of technology
You must have heard of Satoshi Nakamoto. Someone believes that this is a group of developers, and someone believes that this is a real person.
Be that as it may, in 2008, a certain Satoshi Nakamoto wrote an article about the principles of this system. A year later, the blockchain from the idea was implemented into a working technology and tested on another new development – the first Bitcoin cryptocurrency.
Due to the growth in the value of bitcoin, the popularity of technology with which you can work with cryptocurrency has also increased. The history of the blockchain and its application interested not only geeks, but also ordinary users. The information field of the Internet has been filled with new words and software: electronic and cold wallets, stock exchanges, brokers, news, webinars and investment courses. All this and much more has opened up a new way to make money on the Internet, as well as pay for services, buy and sell goods of varying degrees of value. And all this without the control of the state or banks.
The popularity of cryptocurrency as a phenomenon and a tool for free exchange of goods has grown. Other digital money has also been developed. For example, Litecoin appeared in the 2000s. But he, of course, was not unique, but copied in many respects the code of the cue ball. Other cryptocurrencies were already “more interesting”. In their development, mathematical algorithms different from Bitcoin were used.
For example, currencies such as Monero and zCash were created to be completely anonymous. That is, if there is still a chance to calculate the payee when using bitcoins, then in the case of these two cryptocurrencies, it is useless. There are a lot of cryptocurrencies now. This is no longer an experimental “invention” of developers, but a whole ocean of financial opportunities into which we invite you to dive on your own, focusing on English-language sources.
The history of blockchain and the evolution of money
Let’s get back to blockchain. Some users still confuse bitcoin and blockchain. Therefore, at present there is a need to increase the literacy of the population regarding these new concepts. After all, despite their relatively recent introduction into the digital and economic worlds, they already have a tangible impact on our daily lives.
When the popularity of cryptocurrency began to gain momentum, banks became interested in blockchain technology. It happened relatively recently. For example, two years ago, Bank of America and Microsoft began to pour money into the development of their software.
Who made the first major transaction through the blockchain
The first "adult" transaction was carried out by three companies from three different countries: Wave (Israel), Barclays (England) and Ornua (Ireland). They ran $100,000 through the system. If they had done the trade the classic way, the process would have taken several weeks.
How long do you think it took for transactions to “pass” through the blockchain system? Nobody fixed the exact figure. But we know that it took the representatives of the three countries no more than four hours to complete all the operations.
The recent history of blockchain
In 2017, Alfa-Bank successfully “tested” the technology by issuing a letter of credit with S7. And this is not the only example. To improve the efficiency of such systems, several banks have recently teamed up to develop a common Masterchain platform.
What were the world banks doing at that time?
Three years ago, the banking community around the world "chimed in" and spent about $75 million on developing the technology. Aite, a financial advisory firm, expects that figure to rise to $400 million by next year.
“How did we live all this time without blockchain?”
It is hard to imagine 2018 without social networks, instant payments, cryptocurrency and blockchain. The history of the blockchain is now the history of every user, regardless of whether he confuses the blockchain with bitcoin or not.
The digital world becomes part of the “offline”
On the Internet, you can now order, buy and pay for any product or service. It’s comfortable. But operations of this type should be not only convenient, but also safe.
It is no longer convenient for users to make payments through banks and special intermediary services. For example, transactions of a certain kind are not included in banks’ payment limits. At the same time, if you need to transfer amounts of more than 100,000 🪙 or millions of payments, the bank will most likely refuse you. And if you start making a transfer, it can block accounts on suspicion of hacking or data theft.
How to be in such a situation – to transfer money in installments?
The inconvenience of such a strategy for working with large amounts is another disadvantage of classical transaction schemes. But not the only one. When Satoshi Nakamoto wrote his article on blockchain, he mentioned a very important factor that ensures the security of a transaction – the trust of the parties in relation to each other. Blockchain technology allows parties to bypass this aspect. There is no need to notarize the transaction, or, to believe it, and also sign with blood. Technology allows you to work with people you don’t trust and keeps transactions secure.
Who carries out transactions with such amounts? How do the two parties ensure the security of the transaction? Do they trust each other? Is this trust notarized?
In any case, the process of guaranteeing the security of such transactions is long and complicated. And the world is no longer as slow as it was 10 years ago. And you can, of course, not change the rhythm of your life, but then some options of this life will not be available to you.
This inevitability of change is well reflected in older smartphones, on which users can no longer download new software. There’s nothing wrong with using a fourth iPhone in 2018, but if you didn’t have time to upload Instagram to it in 2010, then you’ll have to log into your account using any other device, or just buy some new iPhone, though iPhone D33.