Blockchain Block Explorer and why it is so important

A blockchain explorer, often called a block explorer, is a website or program that allows users to browse the blocks in a blockchain. It is therefore comparable to the folders and files listed in the computer’s explorer. Almost all popular cryptocurrencies have their own block explorers. In this case, the user can only ever use the Block Explorer that is also intended for the platform. This means that a Bitcoin explorer could not display Ethereum transactions, for example. Accordingly, an Ethereum Explorer must be used for this purpose. The first Bitcoin Explorer was launched in November 2010.

Why is it important?

  • Block Feed: Through the Block Explorer, users can follow live when a new block is attached to the blockchain. The explorer lists these and usually also gives a time and a lot of other info like: Block height, Block hash, Contained transactions, Block output in tokens, Transaction fees and the name of the miner or mining pool
  • Transaction feed: Users can explore and track the transactions of any individual block using the explorer.
  • History of a specific address: It is also possible to track the transaction history of a specific wallet address. Provided that one knows the public address. This makes it easy to check all previous transactions and the current account balance.
  • Evaluation in numbers: Many explorers evaluate and indicate the transactions and blocks. For example, the largest transaction of the day can be displayed, or how many blocks are attached in total or in one day, and much more.
  • Duplicate issues and orphaned blocks: Some of the more advanced explorers can display how many double spends occurred in the last 10 minutes and show how many orphaned blocks currently exist.
  • Mempool: The so-called mempool collects the transactions that have not yet been confirmed and grouped into blocks. These can also be displayed in the explorer. In addition, usually more info such as transaction rates, fees, data size and, for some providers, the global distribution is displayed.
  • Genesis Block: The Genesis Block is the first block of a blockchain. This can also be displayed with the Block Explorer. This also includes information such as date, time and miner

Who uses a block explorer and why?

In general, everyone can and should use such an explorer. Beginners and advanced users can get a lot of interesting information about the particular blockchain. Users can track their transactions. For miners, explorers are also important as they show them the last mined block and the transactions it contains, fees paid and much more. This information can be used to calculate potential earnings and draw many other conclusions.

The explorer is so important because it enables a core property of open-source blockchain technology: transparency! Recording the blocks and the transactions they contain in the Explorer creates a unique and immutable record that is accessible to all.

The blockchain is a logbook that records all data chronologically

Let’s say you want to make a payment and you want to do it by means of an electronic money transfer, that is, not against cash. Today, you rely on an intermediary or a trusted third party, i.e. a bank, to process the transaction. This ensures that the money actually ends up with the target person and that the amount is debited to you. No money can be “generated” or “lost” during the transaction. The amount that leaves you ends up with the recipient, except of course for the fees incurred for the service.If you want to make this payment directly, that is peer-to-peer, you want proof that the agreed amount really goes to the target person. Since an electronic money transfer has no physical component, such as a bank bill, this is not so easy. In addition, you both want to ensure that the amount cannot be subsequently increased or reduced. If there is no central authority that both parties trust, this becomes difficult. This is where the blockchain comes into play.

How does the blockchain solve this problem?

A solution has been found to the “problem of the Byzantine generals.” That is, the question of how to ensure consensus on a “truth” in a public network.

Let’s put ourselves in the situation of a group of people who want to meet for a party. The time when the party is to start is not yet clear. Unfortunately, the people can only talk to each other in direct conversation, i.e. 1:1. As another challenge, there are some “black sheep” among them. That is, people who want to sabotage the party and deliberately pass on a false start time. How do you get a secure solution without an organizer or Whatsapp?The document “Bitcoin: A Peer-to-Peer Electronic Cash System” published under the pseudonym Satoshi Nakamoto presents an algorithm that solves the problem of the Byzantine generals for the first time. It is based on what is called a proof-of-work, the computational solution to an encryption problem.

In detail

First, let’s start with the concept of encryption. The image of an egg helps here (At this point, many thanks to my colleague Marc Pouly for this brilliant analogy). I’m sure you’ve all made a fried egg before. Cracking it is easy. Reversing the process, that is, turning a fried egg back into a whole egg, is not possible. The same thing is done in computer science by a hash function, a non-reversible encryption function. The fried egg is equivalent to the hash value and the breaking of the egg is equivalent to the hash function.

Now for the proof-of-work. Imagine a chicken producing individual eggs, depending on the food combination you feed it. Your task now is to produce such eggs whose fried eggs achieve a specific, predetermined shape. This task cannot be calculated in advance and is not reversible. You simply have to try it out. What is certain is that the required fried egg shape is producible if you just try often enough. So you will be busy feeding chicken and cracking eggs for quite a long time. With a lot of work, however, you will get it right. Forget about your cholesterol level. Once you’ve done it, anyone can very easily create such an egg, and thus a corresponding fried egg, from your chicken and the food you found. This approach is called proof-of-work because you literally have to “work out” the solution. In the blockchain, the shape of the fried egg corresponds to the condition that the hash value must start with a certain number of zeros. Since the result is probability distributed, a computer can accomplish it in a given amount of time. The more zeros, the more computing time for the proof-of-work.

Chicken and egg

I have to work out the extra food with the proof-of-work described above. In blockchain, this is called a nonce. It has to be recalculated every time, because the information (1.), the time (2.) the last fried egg (3.) are different each time. Once I have done this, I can append the created egg to the chain. Everybody can check if the egg is rightfully hanging in the chain. He only has to break the egg and gets the predefined shape.

I can read the fed components (information, time, last fried egg, additional food) from the outside by holding the egg against the sun. Thus I can access the information at any time.

Can’t I change the information?

That is exactly not possible! If I would change them, then my additional food, Nonce, does not fit any more and everyone can check this by breaking my egg. In the same way I cannot hang an egg in between in the chain, because with the following egg the fried egg of the predecessor is inserted. So I have to change the whole end of the chain. But this is, due to the proof-of-work, very time-consuming. So that you are quite sure that nobody manipulates the chain with much effort, you distribute now very many copies in the whole Internet. Each new egg is attached to all chains. Maybe one chain fails or is changed wantonly. In this case, the longest chain is the valid chain.

Why is this secure?

Proof-of-work ensures that manipulations require a lot of computing power. At the same time, distribution over many instances makes local modification impossible. This makes it uninteresting to try to change individual transactions. It is more interesting to earn money through mining.

How does Mining fit into the picture?

For the whole system to work, it needs independent chicken feeders, so-called miners. In other words, people who search for the right food combination for given information. After all, as a distrustful contemporary, you want to make sure that your contractual partner doesn’t manipulate the information and put it into the blockchain. That way, he could change the transaction. In the beginning, Bitcoin users did that themselves. Today, you often leave the finding, let’s stick with our chicken example, of the right supplementary food to professional communities, companies, and even entire states. These miners “dig” for nonce (or chicken feed) so that the result meets the requirements (spiegeleiform). We are not talking about one or two, but a great many. They work on the solution in parallel. The first one wins. And because this is quite hard work that consumes quite a lot of computing power, the lucky finder is rewarded. This reward comes in Bitcoins, an implementation of the blockchain, from a transaction fee and a small portion of newly generated Bitcoin currency.

How is the blockchain revolutionary?

As we have seen, the blockchain methodology is made up of various components that come together to form a big picture.

From a computer science perspective, it’s exciting because until now in the database space, the focus has always been on whether the database is coherent (consistent). The blockchain represents a distributed, public database where the focus is on the individual transaction, and thus the question: is the transaction correct?

From an economic perspective, it is exciting because until now, a trusted intermediary (trusted third party) was always needed when two parties transacted a mutual transaction or contract. In the financial sphere, the role of the intermediary is played by banks. Bitcoin is a currency that eliminates the need for banks as intermediaries.

However, the blockchain is not limited to the financial sector. With this technology, it suddenly becomes possible for contracts between two parties that potentially distrust each other to be settled on a public network. The role of the intermediary is assumed by the community. In principle, this could make all intermediaries superfluous. Be it established ones, such as notaries in the contract sector, or newly created ones, such as Uber.

Categories
Knowledge

Leave a Reply

Your email address will not be published.