Excellent! Everyone's balances are updated.

At this point you might be thinking "There really isn't much to this whole digital currency thing!". Or, more likely, you're considering all the problems with this scenario:

Alice, Bob, and Charlie need to trust that you won't cheat them. As the bookkeeper you need to be resistant to bribes!
Alice, Bob, and Charlie need a way to easily view their balance that is widely available and up-to-date.
Alice, Bob, and Charlie invite more friends into your currency circle and quickly the bookkeeping becomes too much for you to handle.

We know how to solve problems #2 and #3 with our programming skills! We can build a website with an awesome UI and an API for making transactions!

But what about problem #1? How do we solve for trust?

This was a problem that ate at Cryptography Enthusiasts for years. Deep down, many self-proclaimed Cypherpunks felt as though the solution was somewhere in the land of cryptographic technology, yet nobody was able to create a foolproof system.

In, 2008, such a system was imagined. A person or persons, under the pseudonym Satoshi Nakamoto released a whitepaper for Bitcoin. In this paper they described a system that would create a peer-to-peer network for exchanging value. This system would combine years of cryptographic research and game theoretical financial incentives to create a secure, scalable network. The paper describes a chain of blocks tied together cryptographically. This would later be coined the blockchain.

To tie it altogether, blockchain was invented to solve for trust. To create a system that is completely neutral and resistant to any censorship or bribe.

Smart Contract Blockchains

Smart Contract blockchains provide developers with a way to decentralize where the code runs. In this way, code can truly become a public resource. This means code can run without any direct ownership, making it censorship resistant and transparently verifiable.

One important point to drill home is that the decentralization isn't about the code itself, but how the code is executed. For example, let's take a quick glance at some Solidity smart contract code:

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