Page 8 - Phoenix Vol 11 No 4

DAVE KINSEY | Technology
What is Blockchain, How Does it Work, Who Created it, and Why?
In2018, an employee from the State Bar of Arizona asked me to write an article to de- scribe Blockchain to lawyers. e only way I could do justice to the top- ic was to write a book about it. Now that I’ve published that book, I’m go- ing to attempt the nearly impossible feat of condensing it into an article. Adequately describing Blockchain re- quires a book, but here is my best shot
at a reader’s digest version.
A block is a collection of trans-
actions that might look something like: 19x8Vp3WsK3B49FyRw3M6z (1 BTC) → 1f2g9hcB31B3Gyw4K- Fa9D3V
e above example describes a sin- gle Bitcoin transaction. e two long strings of gibberish are called Bitcoin addresses and, in this case, 1 bitcoin was moved from one such address to another. While these addresses are publicly written into the block, there is no linkage back to a person. ere- fore, untraceable transactions occur between anonymous parties, which is the reason why Blockchain was cre- ated.
Bitcoin is a cryptocurrency (literally “hidden money”) and it is untraceable because no governments are required AND no governments are supposed
to be allowed to participate in this system. Bitcoin is the name that was given to the so -
ware and the system (the network of systems running the so ware). It is also the name of the “coins,” or unit of measure. ere are no gold coins, all such pictures are strictly marketing. Bitcoins are just numbers in a com- puter program.
It is the product of a community called the Cypherpunks, that was rst established in 1992 to bring about something called Crypto-Anarchy (hidden anarchy). Bitcoin was cre- ated to establish a hidden corner of cyberspace where governments (law enforcement and military) cannot see what is going on. Laws, such as anti-money laundering laws, can- not be enforced, and so governments become increasingly irrelevant. One of the stated long-term goals of the Cypherpunks is “collapse of govern- ments.” Cypherpunks hope that law irrelevance leads to even-
tual collapses of ALL gov- ernments.
Over the past three de-
cades, a
“The original intent of Blockchain had no concept of “people”. The original design allows everybody to be anonymous. If there are no people, there is nobody to whom one might grant or deny permissions.”
Dave Kinsey is the president and owner of Total Networks, the technology adviser to Arizona’s law rms. Mr. Kin- sey is on the technology committee for the State Bar of Arizona, has presented at several CLE seminars on the topics of technology security and data protection, and his team is the rst and only Arizona IT company to earn the CompTIA Security Trustmark, certifying that Total Networks meets or exceeds security best practices. For questions about Blockchain, email me at [email protected]. For questions about IT, email me at dkinsey@ totalnetworks.com. Lastly, you can nd The Blockchain Code, in paperback and Kindle, on Amazon.
ATTORNEY AT LAW MAGAZINE · PHOENIX· VOL. 11 NO. 4 8