A description of blockchain normally starts with an explanation that it is a distributed, open protocol. I find that this isn’t the most helpful explanation to someone completely new to the space. Firstly, they have no idea what a protocol is, nor what it means to be distributed or open.
Defining the protocol
In computing protocols refers to the digital communication between digital systems and/or products. In simple terms a closed protocol means that the digital system cannot interface with any other digital product outside of its system. In contrast an open protocol can communicate and interface with other systems.
Cryptocurrency open protocol
In terms of cryptocurrency a protocol refers to an agreed upon instruction manual. This instruction manual details how the cryptocurrency code operates.
An open protocol means that the developers and users of the blockchain must reach rule consensus. Blockchain developers are normally disbursed around the globe. As such, discussions on what the open protocol should be take place within private chat rooms and forums.
Occasionally, there are debates within the blockchain development community. As open protocols require broad consensus disagreements aren’t simply resolved by majority rule. Instead, what often occurs is that the minority group will break away with a different view and a different version of the blockchain. This is called the hard fork.
Bitcoin open protocol
Despite the above explanation it might be hard to grasp the concept of protocols. Let’s take Bitcoin as an example. Bitcoin has a series of protocols that defines how it works.
The Bitcoin open protocol specifies the maximum block size of 1MB, a contentious issue if you’re a proponent for Bitcoin Cash. Another main aspect of the Bitcoin protocols is the fact that the block reward halves every 2016 blocks.
As you can see, the open protocol dictates the entire blockchain incentive structure, speed, capacity and growth.