Oh yeah, I forgot to answer your question. It is referencing Bitcoin blocks.
The purpose of referencing the Bitcoin block hash is to create a provable timestamp for the creation time of the squeak. It guarantees that the squeak was created at least after the time when the block was mined.
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And blocks are just a way of having a reliable means of providing time in a distributed context?
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Yes. Each squeak has a block hash embedded in it (before it gets signed). So when you download a squeak from another peer, you can verify that it was created after the block time.
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