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This time we’ll go through some blockchain basics.
So – let’s dive into it, shall we!? 😉
To fully understand what makes NFTs special, we need to first have a basic understanding of a blockchain. In order to understand blockchains, we need to understand the concept of a database.
A datum is any single piece of information. Data is the plural of datum – or a collection of pieces of information.
Any application used to store that information is called a database. A good example of a database is a registry of deeds.
Each deed in the registry refers to a particular piece of land. When the land is sold, the database is manually updated with the new ownership information, and a new deed is issued.
When an NFT is sold, the new ownership information is stored on the blockchain. Up until blockchain technology arrived, all databases – like a registry of deeds – were controlled by centralized authorities such as governments, corporations, businesses, schools, etc.
A traditional database is only accessible to a limited number of authorized users.
Whoever is in control of a centralized database can change the data contained in the database or even destroy it altogether.
For example, it’s plausible that someone at the registry of deeds could change the data relating to a certain property without anyone else knowing.
What we need is a decentralized, self-authenticating, immutable database called a blockchain.
Traditional databases are centralized and anyone who has access to them can tamper with them. The only way to make a database tamper-proof is to make it decentralized so that no one can tamper with it.
This is accomplished by distributing the database across a large number of computer systems owned by unconnected parties.
Rather than running on a single computer network, a blockchain network runs on thousands of independently owned computers. No one person can change the information recorded on a blockchain database without everyone else knowing.
In order to change a record in a blockchain, it would need to be changed simultaneously on all computers in the network, which is of course, impossible. Moreover, to completely destroy the NFTs on a blockchain, you would have to destroy the entire computer network.
Fortunately, each of the entities that run computers on a blockchain has a strong financial incentive for assuring the smooth operation and continued integrity of the blockchain.
Thus, the blockchain is decentralized.
Now that we covered the blockchain basics, our next article will talk about smart contracts, minting, and gas fees. Looking forward to continuing this journey with all of you! 😀
The article was written by: Ivan Markov, NFTartXpert