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Understanding Blockchains

What is a blockchain?

A blockchain is a permanent, yet ever-evolving record of actions. These records are grouped together in “blocks” of data that are then linked together in a massive chronological chain.

New records get added to new blocks, and once a block is filled it gets added to the end of the chain. A block that has been added to the chain cannot be removed or changed.

Blockchains can also be thought of as a type of ledger or database.

Why decentralization?

There are many different blockchains with various characteristics, but the kind you’ve probably heard the most about are decentralized blockchains. Decentralized blockchains are extremely powerful because no individual or company controls them.

Instead, lots of different people all over the world come together to take care of them, build things on top of them, and share in the benefits they create. Decentralization helps reduce the chances a bad actor or corrupt government can monopolize or disrupt the network. The people own and control the blockchain collectively.

Why should I use Ethereum?

Ethereum is the most popular decentralized blockchain because it is extremely secure, widely trusted, and actively developed.

It also is highly scalable thanks to the number of projects that are compatible with it.

Ethereum has been around for a decade and has weathered many storms, thus increasing its trustworthiness.

What can blockchains be used for?

Ethereum can hold many different types of records such as financial data, cultural artifacts, and even useful software.

This flexibility has caused Ethereum to be one of the most diverse ecosystems out of any other blockchain — artists, scholars, researchers, developers, scientists, and gamers are all able to use Ethereum in creative ways. Ethereum is for everyone.

The Ethereum Ecosystem

The Ethereum blockchain and associated networks power tons of cool applications and services. These are a few of our favorites!

Layer 2 Networks

Layer 2 Networks are a second blockchain built on top of the main Ethereum network. This second layer processes transactions faster and with lower fees than the main network, but still maintains the security and trustlessness of Ethereum.

Layer 2 networks include…

Layer 3 Networks

Dapps

The word ‘dapps’ is short for ‘decentralized applications’. This is another name for the useful software that can run on the blockchain.

Some of our favorite dapps are…

DAOs

DAO is an acronym that stands for “decentralized autonomous organization”. In a DAO, authority and decision-making abilities are distributed among the members of the group, who cast votes.

DAOs to learn more about are…