Lots of bitcoin articles are written by authors who themselves are confused. Easiest way to spot them? Look for someone claiming “blockchains are important, not bitcoin.”
The author in this article is correct that a blockchain is an immutable database that stores records permanently, but people like him don’t understand WHY it’s immutable, mainly because they don’t understand why bitcoin itself works in the first place.
A blockchain is basically just a database that has each “block” or bundle of records referencing a prior block, using hashed signatures. A hash is a complex function that creates a unique set of characters, a digital signature, based on the data you feed into it. Change just one character in that data, an the signature will be completely different. Blocks include all the data in the block, plus the signature of the previous block. If you change data in the previous block, its signature will change, and it will no longer match the signature in the following block. And if you change that signature in the data block in the next block, then its own signature won’t match either (any change in data will alter that signature). That’s how blocks in a blockchain are chained together and why they’re immutable; any change in past data will make all the rest of the data not match up.
Thing is, though, anyone can run a blockchain. Like I said, it’s just a database. And if you run this database on your own computer, with you being the sole administrator of that blockchain, then there’s absolutely nothing stopping you from changing data in the past block, creating a new signature, and then quickly recreating signatures in all the following blocks. It would literally take a couple of seconds at most.
So, key point is that blockchains are NOT immutable on their own. The ONLY reason the bitcoin blockchain is immutable is because of bitcoin and “proof of work,” otherwise known as mining. In bitcoin, those signatures that sign and link blocks are created not by a single person, but by a decentralized group of people. Those signatures are very difficult to create so that no one else can go back and just replace them. And why would those other people waste their time and money to create those signatures in the first place? Just one reason: profits, in the form of valuable bitcoins.
What this means is that blockchains, in the way we know and use them (as opposed to plain databases) are completely inseparable from the digital currencies they run. You can’t have a blockchain without a bitcoin. And you can’t have a blockchain without the bitcoin actually having some value, otherwise no one would mine it and secure it. And an insecure blockchain is just an easily “mutable” (alterable) database.
The author also talks about how later on it will become too expensive to mine bitcoin, and thus no one will do it, but that’s just him not understanding the technological aspects of proof of work and difficulty adjustments, suggesting he doesn’t know how these blockchain things work at all, but I won’t go into that this time.