Machu Picchu: blockchain 101 for humanitarians

Photo by James Wainscoat on Unsplash

Machu Picchu is a collaborative open source initiative. It aims to use the Ethereum blockchain to share “Data as a Public Service” among all the organisations that provide support and benefits to the persons in need.

We already explained in a previous article how Machu Picchu plans to bring the blockchain within reach of persons-in-need, while letting these persons keep ownership of their data, using only an old feature phone.

We’ve also seen why humanitarians should be interested in the blockchain, like the way they are using today the Internet.

To use the Internet, you all know what is a server, what is a Internet access provider, what is a login. Similarly there are 3 basic concepts that you need to grasp, to use the blockchain. Let’s go through them.

What do you need to know, to use the blockchain?

There are 3 basic concepts you need to know:

1. what is a blockchain in general?
2. what is a blockchain network and what can you do on it?
3. what is a blockchain account?

What is a blockchain?

A blockchain is a community of participants who share the same information and maintain the memory of this information with no central holder.

In the French Alps, from 1343 until 1791, every family kept a register (“escarton”) of their contributions to the maintenance of the common network of irrigation ditches. The amount of water each family can claim for their cultures depends on these volunteering contributions. In case of dispute, the village council compares the escartons of all families.

The “republic of escartons” is the ancestor of blockchains and lasted for more than 450 years between France and Italy.

In the following we’ll focus on the Ethereum blockchain.

What is a blockchain network and how can we use it?

“Blockchain” is a generic term. A “blockchain network” is what you will actually use. Let’s call it a “net”.

You can consider a net as a virtual world (and the community of users of that virtual world) with its own virtual currency and virtual assets.

The assets are:

• “gas” is what fuels a transaction, for example storing a piece of data or paying a benefit. A same transaction always costs the same gas. The amount of gas needed depends on the complexity of computation of that transaction. By analogy, a vehicle that carries and shares the transactions among all participants need “gas” for that transport.
• “ETH” is the value that the virtual community gives for a unit of gas. By analogy, ETH is used to pay the cost of the fuel. Since each “net” is a distinct virtual world, ETH used in one “net” (one world) is ignored in another net.
• A “token” is a virtual asset that has some value in ETH depending on how the service provided by this asset is useful to the people of this net. By analogy, a token is a “mile” in the traveler incentives of airlines. Living in a same world, if you don’t travel by airlines, the “mile” tokens have no value for you. But if some other persons need a few tokens more to be allowed to upgrade their seat, these few tokens may have a lot of value for them.
• A “DEX” is a decentralised exchange where people of the same net can swap their ETH or their tokens in a peer-to-peer manner, without any intermediate. By analogy, imagine that you can exchange airline “miles” against a “fidelity” coupon of your favorite Philharmonic Orchestra (or against some “gallons of water” of your favourite escarton 😉 😂 😉).

Example of “nets”

In Ethereum, the most used nets are:

• the “main net” is where all the buzz about cryptocurrencies and hacking happen. The ETH of the main net was worth 1350 USD in January 2018 and 550 USD in November 2020.
• the Ropsten “test net” is used to test blockchain developments. Each transaction takes ~15s to be acknowledged. Transactions are not secure, contrary to the main net. This means that transactions on this net have no value, like your transactions in a Monopoly session.
• the Rinkeby “test net” is also used to test blockchain developments. Each transaction is immediately acknowledged. Consensus on validity of transactions is settled using a different protocol than on Ropsten (technically, “proof-of-authority” instead of “proof-of-work”).
• the Kovan test net and the Görli test net are 2 other examples.
• we can also imagine a private test net among all humanitarian organisations, although the logistics of deployment are not quite simple. But it could be worth it, at a certain scale.

What is an account?

A blockchain “account” is your representative to the blockchain world. Not quite the same concept as an account at your bank.

You may decide to use the same “account” on different nets, but doing so you’ll get quickly confused because the assets that this account has on each net are totally unrelated, as shown below:

Considering that it costs nothing to create an account, the recommended practice is to dedicate one account per net and to give it a significant name. Doing so brings you back the similarity with a bank account and will make you feel more comfortable. We’ll see how to use an account in the next article that guide you installing and using Metamask.

What have we learned?

• A blockchain is a community of participants who share the same information and maintain the memory of this information.
• Each blockchain network (a “net”) is a distinct virtual world. The virtual assets of a net are specific to this net.
• The assets inside a net are “gas”, “ETH” and “tokens”. Tokens can be exchanged using DEXes.
• Accounts are your virtual representatives in the different nets. It is more comfortable to create a distinct account per net.
• In the next article, you will learn how to install Metamask on your browser and how to use it to reach different nets.
• In a final article, you’ll create for fun a character by compositing its face with various elements and use Metamask to store it on a test net. This is very similar to registering a person-in-need on the blockchain.

Thank you for your interest. Let’s make Machu Micchu happen together. The potential is immense.