Summary: Blockchain is a decentralized, digital ledger that records transactions on multiple computers. It offers increased security and transparency compared to traditional ledger systems.
What is Blockchain?
Blockchain is a decentralized, digital ledger that records transactions on multiple computers. These transactions can be anything of value, such as financial transactions, contracts, or records of events.
How Does it Work?
Each transaction is recorded as a block, and these blocks are linked together in a chronological chain, hence the name “blockchain.” Each block contains a unique code called a “hash” that allows it to be securely linked to the previous block.
Benefits of Blockchain
One of the main benefits of blockchain is its security. Because it is decentralized and distributed among multiple computers, it is virtually impossible to hack or alter the information on the blockchain.
Another benefit is transparency. All transactions on the blockchain are visible to everyone, which helps to build trust and accountability.
Examples of Blockchain in Action
One of the most well-known examples of blockchain is Bitcoin, a digital currency that uses blockchain technology to facilitate secure and transparent financial transactions.
Other examples of blockchain in action include supply chain management, voting systems, and real estate.
There are 4 types of blockchain:
- Public Blockchain – No restrictions, anyone can participate in the network.
- Private Blockchain – Only selected nodes can participate in the process, making it more secure.
- Hybrid Blockchain – Mixed content of the private and public blockchain.
- Consortium Blockchain – Validates the transaction and also initiates or receives transactions.