What blockchain is and how it works

A blockchain is a decentralized and distributed digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the consensus of the network. Each block contains a cryptographic hash of the previous block, a timestamp and transaction data. By design, a blockchain is resistant to modification of the data.

When a new transaction occurs, it is verified by multiple participants in the network, and then added to a block. This block is then added to the blockchain, which is stored on every node in the network. Since each block contains a hash of the previous block, it forms a chain of blocks, hence the name “blockchain”.

Since the ledger is distributed across the network and each node in the network has a copy of the blockchain, there is no need for a central authority or intermediary to verify transactions. This makes blockchain technology secure, transparent, and resistant to tampering or hacking. The most famous application of blockchain technology is cryptocurrency, but it can be used for many other purposes as well, such as supply chain management, voting systems, and digital identity management.

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