What is Blockchain?

To understand Blockchain, we need to go back to 1000 BC to review the people who inhabit on Yap Island which located in South Pacific. The Yapese people had a unique form of currency called Rai Stones. These stones could not be physically traded because the height of these stones roughly about 12' tall and 8000lbs. Therefore, the Yapese people used mental ledgers to record all the transactions. Mental ledger is a decentralized ledger that allows all tribe members keep a copy of the ledger in their head, which means everyone knew who owned which Rai stone at any time. So, you might wondering how are they going to make a transaction? Here's an example:

1. Lisa wishes to trade Adam her stones by the river in exchange for a small flock of sheep.

2. Lisa and Adam announce their transaction to all tribe members.

3. Everyone updates their mental ledger. They agree that the stones by the river is owned by Adam until trade he trades it.

In other words, when two parties wish to make a transaction. they would announce their transaction to the tribe and all the tribe members update their mental ledgers. So this is the core concepts that Blockchain technology is built on.