What is BlockChain

What is Blockchain?

Blockchain is a software protocol (underlying internet transportation layer) that guides internet to how to send money or asset over internet (same as SMTP is a software protocol for sending/receiving emails over the internet). The way we need an email address to know (whether gmail/yahoo etc) to send emails, same is in Blockchain you need  digital wallet address to send Bitcoin or other Crypto Currency.

The blockchain concept originally was developed as an efficient and secure way to manage and register transactions made with crypto-currencies (for example, Bitcoin). Until now, it has mostly been of interest to individuals and financial institutions. With its Distributed-Ledger Technology (DLT) and Smart contracts, blockchain has great potential to benefit all companies across the global supply chain—not just banks. 

Blockchain is a public ledger of all Bitcoin transaction occurred.

A Blockchain is a distributed computing architecture where every network node executes and records the same transactions, which are grouped into blocks. Only one block can be added at a time, and every block contains a mathematical proof that verifies that it follows in sequence from the previous block. In this way, the blockchain’s “distributed database” is kept in consensus across the whole network. Individual user interactions with the ledger (transactions) are secured by strong cryptography. Nodes that maintain and verify the network are incentivized by mathematically enforced economic incentives coded into the protocol.

Bitcoin is just an application (uses Blockchain Technology) and is just one implementation of Blockchain like another crypto-currency applications.

Blockchain resolved the problem of 'Double Spent', where after Bitcoin is received in your wallet, it cannot be copied to make multiple copies. This is done using a 'Distributed Ledger' system (like a big giant Google Spreadsheet accessible to all).

More Technically:

• Decentralized/Distributed DB and a Peer-to-Peer Network - that stores a registry of transactions.   
• Offer Peer-To-Peer Transaction. I.e. No Third Party/Middle-Man is Involved
• A type of distributed ledger. Well not all BC ledgers are distributed
• Incorruptible digital ledger of economic transactions and can be programmed to record not just financial transactions but virtually of any value.

• Information held on a blockchain exists as a shared — and continually reconciled — database. 
• The blockchain database isn’t stored in any single location, meaning the records it keeps are truly public and easily verifiable. 
• No centralized version of this information exists for a hacker to corrupt. 
• Hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.
• Has no single point of failure.

Simple Example:

• Google Docs/Sheets
• Picture a spreadsheet duplicated thousands of times across a network of computers and this network is designed to regularly update this spreadsheet.
• With Google Docs (or Google Sheets), both parties have access to the same document at the same time, and the single version of that document is always visible to both of them. It is like a shared ledger, but it is a shared document. 

• Wallet:
• BC potentially cuts out the middleman for these types of transactions.  
• Personal computing became accessible to the general public with the invention of the GUI, which took the form of a “desktop”. 
• Most common GUI devised for the blockchain are the so-called “wallet” applications, which people use to buy things with Bitcoin, and store it along with other crypto-currencies.

Peer-2-Peer Network:

• A network of so-called computing “nodes” make up the blockchain.
• Computer connected to the blockchain network using a client (e.g. Slack) performs the task of validating and relaying transactions.
• Each client gets a copy of the blockchain, which gets downloaded automatically upon joining the blockchain network. 
• Every node is an “administrator” of the blockchain, and joins the network voluntarily. However, each one has an incentive for participating in the network: the chance of winning Bitcoins.)

Typical BlockChain Transaction:

• Request: Someone request a transactions
• Broadcast: This transactions is broadcast to a P2P network, consisting of computers, called as 'Nodes'
• Validation: This network of nodes, validates the transactions and user status using known algorithms.
• (Note: A verified transaction can involve 'Crypto-Currency', contract, records and other information)
• Combine (To form new block of data): Once verified, this transaction is combined with other transactions to create new block of data for the ledger
• Add to Existing BlockChain - This new block of data is then added to existing BlockChain, and becomes permanent and unalterable
• Complete - Transaction is marked complete

Type of Blockchain:

• Public Blockchain - 
• Fully De-centralized
• Anyone can read & download transaction
• Ethereum and Bitcoin uses Public BC
• Consortium Blockchain
• Partially De-centralized
• Controlled by pre-selected set of nodes
• Private Blockchain
• Centralized
• Banks prefer Private Blockchain

Cryptocurrency /Crytographic Wallet:

Reference - Link 
A Cryptocurrency wallet is a secure digital wallet used to store, send, and receive digital currency like Bitcoin. Most coins have an official wallet or a few officially recommended third party wallets. In order to use any Cryptocurrency you will need to use a Cryptocurrency wallet.

Here you can compare Bitcoin, Ethereum & other Cryptocurrency Wallets - Link

Cryptocurrency itself is not actually “stored” in a wallet. Instead, a private key (secure digital code known only to you and your wallet) is stored that shows ownership of a public key (a public digital code connected to a certain amount of currency). There are various digital wallet in app-store. So your wallet stores your private and public keys, allows you to send and receive coins, and also acts as a personal ledger of transactions. Public key (32 bit) is individual's bitcoin address used to transfer bitcoin to another individual.

Below is a screenshot of Bitcoin Wallet.

We typically suggest using an official (or officially endorsed) wallet for any given coin. So, for Bitcoin we would suggest using the Bitcoin Wallet, and for Litecoin we would suggest Litecoin-QT.

There are a number of different types of wallets. Each “type” refers to what type of medium the wallet is stored on and whether or not the data is stored online. Some wallets offer more than one method of accessing the wallet – for instance, Bitcoin Wallet is a desktop application and a mobile app.

• Desktop Wallet: The most common type of wallet. Typically an app that connects directly to a coin’s client.
• Mobile Wallet: A wallet that is run from a smartphone app.
• Online Wallet: An online wallet is literally a web-based wallet. You don’t download an app, but rather data is hosted on a real or virtual server
• Hardware Wallet: Dedicated hardware that is specifically built to hold cryptocurrency and keep it secure. This includes USB devices. These devices can go online to make transactions and get data and then can be taken offline for transportation and security.
• Paper Wallet: You can actually print out a QR code for both a public and private key. This allows you to both spend and receive digital currency using a paper wallet. With this option, you can completely avoid storing digital data about your currency by using a paper wallet.

Hope this helps!!!

Arun Manglick