A blockchain is a distributed ledger system that is shared amongst a computer network’s nodes. It is a system of storing digital information using a sequence of ‘blocks’ in a public database.
The Long Explanation
Taken literally, blockchain refers to a series of blocks chained together. Each of these blocks holds information about transactions conducted on the network within a given timeframe.
The process of creating a block is known as mining. This often involves the solving of a cryptographic problem by ‘miners’ who have the required computers known as nodes. Each block has a fixed capacity and is automatically closed and linked with the previously filled block, once it is filled.
Nodes are also responsible for storing the data on a blockchain, with every node on the network updated for each transaction. This lack of a central data storage center means records on the blockchain cannot be changed or destroyed.
To further prevent any possible alteration of records, each block is given a unique identifier – known as the hash. This identifier is derived from the information in every block prior to it. So, beyond falsifying the records on every node, any bad actor would also have to alter every block to change a single data.
Thanks to its public and distributed nature, blockchains are considered to be immutable, unfalsifiable records. Today, there are public blockchains as well as private blockchains. The way transactions are validated and managed by each blockchain – known as a consensus method – also varies.
Public blockchains are the most readily available forms of blockchains, and are the foundation for cryptocurrencies like Ethereum and Bitcoin. To view the records on a public blockchain, all you need is a block explorer.
Examples of blockchains
Some popular examples of blockchains include:
- Binance Chain