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What is blockchain

Blockchain is a type of distributed digital ledger that records transactions across a network of computers. Access rights and governance vary across public, private, and consortium blockchains; some networks are governed by a single organization or a defined group.

Data in a blockchain is grouped into blocks. Each new block contains a reference to the previous block, forming a chain of blocks — which is why the technology is called blockchain. The chapter on what blockchain is explains these foundations and the distinction from distributed ledger technology (DLT).

How blockchain works​

The blockchain process usually includes several steps:

  1. A user creates a transaction
  2. The transaction is broadcast to the network
  3. Network nodes verify the transaction
  4. The transaction is included in a new block
  5. The block is added to the blockchain

Key properties of blockchain​

Decentralization​

Data is stored across many computers in the network rather than on a single server.

Transparency​

All transactions can be verified by participants in the network.

Immutability​

Once a block is added to the blockchain, changing the data becomes extremely difficult.

Where blockchain is used​

Blockchain technology is used in many areas, including:

  • cryptocurrencies
  • financial services
  • digital identity systems
  • supply chain and logistics

FAQ​

When was blockchain invented?​

The concept of blockchain existed earlier, but it became widely known after the Bitcoin whitepaper was published in 2008.

Can data in a blockchain be changed?​

Changing data in a blockchain is extremely difficult because it would require controlling the majority of the network.