Blockchain, with Santa Claus, in shameless MS Paint

In another comment in this thread I mentioned my boss asking our team if 'blockhains would be a good idea to add security' in our web application because a customer mentioned them. If I were to send this MS Pain visualisation to my boss he'd still not understand anything about it. The subject is quite complex and the metaphor used is far to abstract for people who already struggle with describing the simplest requirements in a clear way.

Note that I don't pretend to know how bitcoins work 100%; I have read up on bitcoins a while back, with this previous knowledge I still picked some things up, but I did not grasp the complete explanation from this MS Paint cartoon.

Maybe someone could shine some light on a few things that I am left wondering after reading this cartoon?:

[1]: What would be actually 'written on the pages' in the case of bitcoins? The transactions? [2]: What mechanism determines what 'finding' or 'mining' bitcoins means? At one point it says that there are rules regarding how many 'pages' there are per day. Is there a parallel for this in Bitcoins? It says that there is randomness involved in mining. I thought you had to find certain key pairs that were hard to calculate and that those key pairs were then used to grant people bitcoins again. Are the reward-bitcoins simple written in a new block? How does mining work? [3]: 'Sahti' seems to refer to money. Are we talking bitcoins or external currencies?

If you struggled with this explanation then I can try another a bit more IT related.

A blockchain is...

A distributed fault tolerant public database that no one owns and everyone can update.

Has this been done before?

Kind of, distributed database are not new. What is new is solving the problem of multiple updates changing the same data at the same time.

So for example let's say the following happens to our distributed database.

User 1 send the following SQL to the network.

  Update customer set balance = 1000 where name = 'Customer1'

and User 2 at the exact same time tries

  Update customer set balance = 2000 where name = 'Customer1'

A blockchain database will have both statements in a block and execute them on every node in the same order. Other distributed databases would run into race conditions.

So when you hear the statement

Blockchain startup X is going to disrupt industry Y.

You can reorganize the statement into something like.

Startup X is going to disrupt industry Y with a new type of distributed database.

1. The transactions.

2. The mechanism used to determine what 'mining' bitcoins means is defined by the bitcoin client software implementation. In case of bitcoin it is about finding a suitable random number by using brute force.

3. I believe the cartoon is using sahti in comparison to bitcoins or ether or any internal currency used in a public blockchain.

Did you check the original images or the downscaled ones on the website?

There's tons of people here on HN that know this stuff by heart, but as far as I understood:

1) I guess so, the blockchain contains the bitcoin transactions.

2) In order to add a block to the blockchain, you need to mix the block's fingerprint with a random value and shake, hoping for the mix to get a special and very recognisable appearance. If it doesn't work, you have to try a new random number (the block's fingerprint of course stays the same). When you've found a good number (which takes a lot of tries and luck) you raise a flag and say "hey, found it", and you can add your block to the chain. Then you're rewarded with some amount of bitcoins that are created from nothing (hence mined). I don't have clear how this reward is granted, whether it's already written in the block you're trying to add or in a new one, and in which form.