The answer to this question is a resonating yes! You need to tell your children about blockchain technology. It is not just about its link to cryptocurrencies, but with so many other things about to happen in the future. So, let’s have a look at a very simple way you can teach your child about blockchain technology.
Start with the basic concept of blockchain technology
Here is some of the most confusing stuff that needs to be explained first.
There can be many ways to start this conversation. For instance, you can give your child the example of a school. There is a school where the principal wants to ensure that all the teachers have accurate records of school-related information. However, there are some problems in the traditional (current) record management systems used by schools. One issue arises when the principal and the teachers try to consolidate the records, because oftentimes there are discrepancies.
Now, imagine the principal wants to create an immutable or unchangeable record about everything in the school. The principal comes up with this brilliant idea of creating multiple copies of the same record. The copies are distributed to all the administration personnel and teachers responsible for updating the school’s record. Whenever there is a change in any record in the school, the principal conveys that to the teacher and school administration. Everyone in the school then updates and matches the records with each other.
Although, in the real world, it seems to be a manual and tedious process, it only takes seconds to update all the records in the computer world. So, if there is a change in any of the past records, and whenever everyone reconciles with the copies of the record that everyone in the school has, they are able to identify if there are any discrepancies. Then, if we create this record keeping on a massive technological scale with great computing power on its back, then this begins to resemble what is called a blockchain.
Now, let’s take this example of record keeping in a school and apply different components of blockchain technology to it.
When trying to teach your kids about decentralization, the school scenario works quite well. In a decentralized model, there isn’t just one person in the school that is keeping all the records. With several people keeping the records, it is more safe and the school’s principal, administrator or record keeper can be kept accountable. That’s because decentralization means everyone can tally their records whenever they want to, in order to maintain the integrity of the information.
This is quite useful and makes the school’s record keeping system more reliable. There is almost no chance of the data getting corrupted. For example, in case of funds, If everyone in a school’s record system knows where the funds are coming from, there is very little chance of fraudulent transactions taking place in the institution.
Distributed ledger implies that the records can be seen by anyone in the school’s management and even parents of the children studying there and even the children. No question is asked when someone tries to access the records. This ensures greater transparency and everyone understands how the school is managed.
Now, imagine if there is a voting system in the school where parents are part of the management like in some community schools. If they know what is taking place inside the school, they can make better executive decisions. Even the school’s top management can make better decisions about the future of the institute by knowing, through immutable records, what’s happening where. Also, since all the members of school’s management have access to all the records, they can validate all the transactions.
Tamper-Proof Record Keeping
The last thing that you need to tell your child is that, besides managing financial affairs, blockchain can be used to transparently record just about any type of data or information. So, the increased transparency prevents anyone from manipulating and corrupting the information. So, even if one or two persons make changes to system data, everyone would have to approve and reflect them in their records before it can be validated.
The validation process is a self-reviewing system that quickly highlights the changes. This level of check and balance keeps people with mischievous intentions at bay, not allowing them to to make any unwarranted changes.
Blockchain technology is not Bitcoin
One of the most important things to make clear to your child is the difference between blockchain technology and Bitcoin. Unfortunately, even many adults sometimes mix the two. Blockchain technology is a way of keeping records, financial and others. Bitcoin is a cryptocurrency that uses blockchain technology to process financial transactions and serve as a medium of exchange and store of value. So, what you can also explain is that Bitcoin is only one way we can use blockchain technology to our advantage.