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2.2 Ethereum: a Programmable Blockchain Although the concept of the blockchain was born out of the research into cryptocurrencies, they are much more powerful than just that. A blockchain essentially encodes one thing: state transitions. Whenever someone sends a coin in Bitcoin to someone else, the global state of the blockchain is changed. Moments before account A held 50 coins, now account A is empty and account B holds 50 coins. Furthermore, the blockchain provides a cryptographically secure way of performing these state transitions. In other words, not only the state of the blockchain can be verified by any outside party, but any state transitions initiated by blockchain users can only be performed in a secure, verifiable manner. An interesting way to think of a blockchain is as a never-halting computation: new instructions and data are fetched from a pool, the pool of unconfirmed transactions. Each result is recorded in the blockchain, which forms the state of the computation. Any single snapshot of the blockchain is the state of the computation at that point. 28PDF Image | Intro to Ethereum and Smart Contracts
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