How Can a Blockchain Be a Monetary System? | DASH School #3

Hello, and welcome back to Dash School, Padawan, I am your teacher, Amanda B Johnson and as a quick recap, what we’ve discussed thus far is in our hypothetical digital ledger of e-Money or hey, our blockchain, the “who” gets to make updates to it are the “miners”. You know, those people with the funny fancy math problem solving computers. A miner gets to make updates to the ledger when their machine was the first one to have solved the math problem. This being done in a regular and orderly manner. And the reason why we are able to trust these entries into the ledger as being accurate is that the entire history of every unit of e-Money is public in the blockchain. Just as an example, imagine that this is a zoomed in snapshot of two consecutive blocks. If this block shows me having more units of e-Money than I did in the last block, there has to be a transaction a record of someone sending me that e-Money for this block to be valid. If there isn’t…… Not a valid block. Same would go for your balance. If this block shows you as having zero and in the last block, you had 2.5 units of e-Money, again, there must, somewhere in this block, be a record of a transaction of you sending your 2.5 units of e-Money somewhere else. If that didn’t actually happen, invalid. And so you may be wondering “How do people send units of e-Money to one another – to then be recorded in these blocks in the blockchain?” And that takes us to what I told you today’s lesson would be about. Cryptography is a form of mathematics that provides the basis for how different accounts on the blockchain interact with one another. And you don’t need to understand cryptography, trust me, I don’t, to understand how we use it. Remember how I mentioned in the last lesson that on a blockchain, our accounts aren’t organized by something like our name, But are rather tracked by cryptographic, “alpha-numeric” addresses that look something like this. (Pst) The word alpha numeric being a combination of alphabetic letters and numbers. There you go. So if you wanted to, say, pay me some units of e-Money to pay me back for taking you out to lunch, I would send you this alpha-numeric address and that would be the address you would send the units of e-Money to from your wallet. So our blockchain would show something like your address, unique from mine, having sent 3 units of e-Money to my address. And the next block would be published to reflect this transaction. So that leaves us with the question, well, how did you make that transaction? Did you give a phone call to one of the miners and read them off your long alpha-numeric address and read them off mine and say “Hey, make the update.”? No, what you did was; you broadcasted a message signed by your private key. (blah) – rewind- Your address, (points) you know, the one where you receive payments and then can send on payments to others? there is another word for it. It can also be referred to as your public address. And guess what? The only way to move funds out of this address, that is, the only way to “spend” from it, is to know the private key. And private keys are really long and look something like that (points) And they’re stored right within your wallet. So it’s not like you have to memorize them or something. And so that’s how payments on the e-Money ledger work. You receive funds to your public address, and you can only spend them, that is you can only move them on the ledger if your wallet software contains the private key. That makes private keys super top secret because anybody who knows the private key for a public address can spend from it. That’s why nobody goes around posting their private keys in online forums. it’s just not done. So when using your hypothetical e-Money wallet and you want to send Amanda 3 e-Moneys for covering lunch yesterday, all you, as the user do, is tell your wallet you want to send 3 e-Money and click send. Easy enough. What your wallet is doing however, is creating a signature of your private key that only you know, that broadcasts the amount you want to send and to whom to the entire rest of the network. so that they can update their ledgers accordingly. So that whole public address, private key thing; the stuff that’s mostly managed by your wallet? That’s the cryptography bit. See? I told you it wasn’t that hard. And as a little bonus bit of knowledge for you, remember how mining is solving math problems? The math that those mining machines are doing are called hash functions. And they are based on cryptography. Cool, huh? So, I have to say right now, congratulations to you because thus far, you already know everything you need to know about a blockchain. First, that it’s a digital ledger. Second, that updates to it are mined, And third, is that the account system, you know the sending and receiving bit, as well as the mining system is all based on a form of math called cryptography. You win! You win the golden ticket for getting this far! So that just leaves one question in my mind really. If this blockchain system I’ve just described to you makes for such a cool e-Money and all, Why aren’t you neighbors using a blockchain based form of money? Why doesn’t the butcher down the street accept some kind of e-Money? How is it that this whole money by blockchain phenomena has not spread across the face of the Earth? Well, at Dash, Digital Cash, that’s because we believe that it’s got to be way more functional than that. So, what makes Dash different? Why do we believe that Dash will become the e-money that your neighbors and neighborhood butcher, and yes, even “Mother” comes to use? Simply tune into the next episode of Dash School to find the answer. (preview of the next episode is shown)

26 thoughts on “How Can a Blockchain Be a Monetary System? | DASH School #3”

  1. The main thing that me makes hold on to my crypto-currency for now and wonder when and how I will ever spend it or get paid with it is TAXES! If I manage to find a butcher who takes DASH or some other crypto, am I paying him "under the table?" What if I decide to have a few of my customers pay me with Bitcoin or DASH? What if my DASH goes up thirty percent and I use a DASH debit card to buy gasoline with it later that year?

    Taxes and IRS. This is the single thing that bothers me the most about crypto-CURRENCY.

    BTW, "Node 40 Balance" is only affordable to Masternode holders. 😧 What about the DASH ledger automatically taking care of FIFO accounting. Just kidding, oh what a nightmare that would be, 😨 the ledger managing your capital gains.

  2. Hola Amanda! I need a personal teacher and You look like the smarter and prettier one from all around the globe.. Congratulations dear. Blessings ! ! !

  3. I am the mother of 3 millennials. To the best of my knowledge, none of my kids own digital currency but I have owned and used btc for years now Yes, even mothers aren't always clueless. .

  4. Thanks for the info… Easy to understand and I purchased a book on how to understand these things but now I can use what you say in conjunction to what I'm reading to understand it even better.

  5. can someone figure out how to clone Amanda… she's the ideal woman that every man on planet earth needs in their life

  6. Great teaching Amanda, i send everyone wanting to know about blockchain to your videos. Regarding simplifying public and private keys, I see them the same as my bank account number. So I give you my bank account number/public address into which you deposit/send money/bitcoin, then I use my password/private address to access that money/bitcoin now in my bank account/digital wallet.

  7. all makes good sense… except the "maths problem to be solved"??? That makes no sense to me what so ever. Why is there a problem??? What "problem" and worse why reward a problem solving exercise here??? If we're dealing with so many interlinked CPUs with clean functioning bug free software… where and why do any "problems" arise at all in order for them to have to be solved?? To me this is totally bizarre, and slightly suspect. Can anyone explain?

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