What is cryptography?
The art of protecting information by transforming it (encrypting it) into an unreadable format, called cipher text. Only those who possess a secret key can decipher (or decrypt) the message into plain text.
. i.e. Alpha sends Beta $X
sha256 : d935ab551a557dbf0728741c45a6430b38b1af845eb9c19cd64a0904b8bb793a
What is Blockchain?
A blockchain is a decentralized and distributed digital ledger that is used to record transactions across many computers.
So that the record cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network.
. i.e. Beta sends Charlie $Y . d935ab551a557dbf0728741c45a6430b38b1af845eb9c19cd64a0904b8bb793a
sha256 : ff1cd078e5a370cfb4bb258f471ef1b16b9cb617f0ef60aef8d4aa689af105d1
Even the slightest change in any information will result in significant data discrepancies.
“New block’s” encryption depends on “old block’s” encryption, hence the “chain”.
What is Mining?
Mining is more accurately described as accounting, or ledger writing.
Since blockchain technology is a decentralized system, anyone can participate in the accounting of the network.
Validation rights is distributed according to miners’ computing power, also known as “proof-of-work”. Transactions that is “agreed” by majority computing power in the network is recorded permanently into the blockchain.
This way it is near impossible to inject pseudo transactions into the network.
Like banks creating $ outta thin air everyday since 1973 (probably even earlier),
hence artificially creating perpetual inflation.
Let’s just say with decentralized currency, you will never experience inflation, ever.
What is Decentralized Technology?
So a decentralized technology is simply distributed rights,
where no single or even a group of nodes can corrupt the entire network.
Some advantages of decentralized system :
Anti-monopoly, anti-hack, anti-confiscation, anti-pressure, anti-corruption, anti-downtime, etc.
Decentralized systems can be implemented into all fields :
social media, media, voting, apps, eCommerce, and so much more.
All cryptocurrency codes are open-source, usually on github,
where the public can study and understand how it works.
(Or someone else will study and translate the simplified news to you)
That means developers cannot inject malicious code into the system,
but instead have to explain how the architecture benefits users.
P.S. bitconnect with the market capital of over 1.4 billion usd (Oct 2017) is not open-source (discretion advised).
[Xiong, 20 Oct 2017]