TL;DR: Blockchains are Roads. Payment Roads!
Hello to the 36 new subscribers joining in this month!
I was quite busy and wasn’t able to post last week as I was out on travel. And I’ll be out on travel again next week. But don’t worry, I’ve got some planned tidbits for everyone that I’ve been cooking up for weeks.
Today I’m explaining Blockchain using road analogies. The road analogies came to me as I creating a presentation deck for Internal Auditors; I think the analogy worked. I actually pitched it to someone I know (Aiden) and she added car analogies to the mix.
I like the road analogies - and I tried it out on internal auditors. It seemed to have resonated with them in terms of understanding the “what the hell is blockchain” from a non technology-based point of view.
As always, you’ll find TL;DR: and graphics at the beginning of each section.
Good reading!
Do you know anyone with a Solana Project? My team and I built a financial-focused tool for Solana users, and we are looking for feedback. Intros and referrals are greatly appreciated!
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Every Blockchain is its Own Set of Roads
Blockchain Transactions are Cars
Why the Roads?
Blockchains are Payment Roads
Every Blockchain is its Own Set of Roads
TL;DR: Blockchain = Roads.
Payment Roads
Every blockchain type is a unique city’s roads.
All cities have their own kind of roads. Some roads allow for trucks, some roads are only for bikes and pedestrian. Every city approaches road construction differently, with some cities doing a lot better than others, and some cities making the best with what was already there. Every city approaches street signs and traffic lights differently.
At a country level, the approach to how roads are built and used are distinct.
Their end goals are the same, but it achieves it while future-proofing will vary.
Thus, Blockchain is very much like the roads for a city.
Developers (the city builders) build roads with an expectation of what kind of traffic will pass through it. If they do well, and other cities like it, the same construction philosophy will be mirrored in other cities.
Communication between cities over great distances - the high way and free ways - can best be interpreted as IBC - Interconnected-Blockchain Communication. Better known as when blockchains communicate with other blockchains. Ever drive in Los Angeles, and then try driving in another region or state?
Blockchain Transactions are Cars
TL;DR: Every transaction is a vehicle that comes in its own shape and form, with its own cargo, with its own fuel type. Not all vehicles are universally accepted on all lanes or garages.
Cars and People Movers
The information (transaction) carried in a blockchain can be represented by the types of cars and other people moving transportation options. In the early days of the blockchain tech era, where Bitcoin only existed in its infancy, we essentially had only one type of car, and it had a maximum road clearance height of 7 feet.
Overtime, that blockchain improved, new features got implemented - even new lanes, and now you can have SUVs, Mini-vans, even Trucks. Such heavier objects didn’t damage the road because the roads were designed for that level of abuse.
Each vehicle also had its own people and cargo, which represents the underlying value of the transaction. And because we’re already there, the fuel literally spent by the car is the gas (Transaction costs on Blockchain are paid for in digital gas).
If you encounter the concepts of “Level 2” blockchains, which are essentially faster processing blockchains, we can think of these “Level 2” blockchains as public transit systems such as trains and busses. After all, the entire point of Level 2 Blockchains are to 1) move a lot of information in a 2) smallest footprint possible.
Why the Roads?
TL;DR: Roads are a key infrastructure of a city.
Protocol = Infrastructure
In Technology Speak, Blockchain is a Protocol.
A Protocol is synonymous to public infrastructure in a city.
The different types of applications - whether an actual application or a “dApp” (decentralized application), are built on top of the protocol.
Think of a business owner with a brick and mortar store. When they open a store, they are not concerned with building roads that get people to the store, they simply buy a plot of land already connected to the road.
Blockchain provides that same level of utility to all those “building code” on it. People build apps, and connect it into the blockchain roads. By not worrying about infrastructure, businesses can better focus their time and resources on their customers.
Blockchains are Payment Roads
TL;DR: The faster money is enabled to move, the more economic growth that can happen. Blockchains are Payment Roads
Faster Money
It turns out, every time payment technology is improved upon, economies grow significantly. To put it differently, the faster money can move, the more transactions that will happen, which translates to a thriving and active economy.
Imagine if payments took 3 months to be validated and cleared before you can benefit from it. Imagine if it took 3 weeks. Imagine it only taking 3 seconds.
Blockchain today is breaking down the amount of time it takes to do complex transactions, and reducing the overall energy needed by humans to facilitate each individual transaction.
It’s a bit mind boggling, and really all you need to remember is this:
The easier it is to accept payments, the more likely you are to get payments. Know any terrible checkout processes? ;)