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Explaining BlockChain to rookies: the analogy of the glass box

From the first time I got involved with Bitcoin and its main technology, I have been looking for a simple way to explain what the cryptocurrencies and Blockchain are to my friends and family; looking for a simple but true analogy that illustrates something so complex.
The understanding of technological matters by them is somewhat limited, so pardon the fact that this analogy inevitably has its own limitations, but I have the honor to present to you – the analogy of the glass box.

 

Addresses, keys and Blockchain

One of the first things people ask me when I talk to them about cryptocurrencies is “if they are stored on a computer, and what prevents someone from” copying and pasting “Bitcoin?” The explanation that the wallets have private keys for addresses often makes people confused, so this was the first idea I would like to analyze.

Imagine a huge vault of a 24 hour bank. The vault is filled with rows over rows of deposit boxes without labels. However, each depot box has a glass facade, allowing everyone to view the contents of the deposit box, but not access it.

When a person opens a new deposit box, they receive a key that is unique to that box. Making a copy of the key does not duplicate the contents of the box. And in the same way, even though you have the key, the box is not technically yours … You only have the ability to access what’s inside it.

This is fundamentally the concept of Blockchain-based cryptocurrencies. Anyone can see the content of all other addresses.

There is no owner information for each address, but everyone is aware of the existence of each address. When someone opens a cryptowallet, it is creating a new address in Blockchain and the private key that “unlocks” that address. This way, you can not “copy and paste” cryptocurrencies because all you could be doing is creating the copy of a key, but not the currency itself.

 

Beyond the analogy

There is a point where the analogy swings slightly – the task of conveying the fact that the transactions are all accessible to the public and that anyone can see that Bitcoin has been transferred from one deposit box to another; even though no one needs to reveal their identity. This thought is a bit complicated. I would love to see ideas in the comments on how this can be resolved and how the analogy can be further developed. Or you can be honest and just comment that you hate the analogy completely – there are no problems with that either.

 

Article by Fabrício Santos at the Cointelegraph, in 2016.

 

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