A blockchain is a distributed, cryptographically-secure database structure that allows network participants to establish a trusted and immutable record of transactional data without the need for intermediaries. A blockchain can execute a variety of functions beyond transaction settlement, such as smart contracts. Smart contracts are digital agreements that are embedded in code and that can have limitless formats and conditions.
Blockchains have proven themselves as superior solutions for securely coordinating data, but they are capable of much more, including tokenization, incentive design, attack-resistance, and reducing counterparty risk. The very first blockchain was the Bitcoin blockchain, which itself was a culmination of over a century of advancements in cryptography and database technology."
- As the name implies it is a chain of blocks, or sets of transactions in chronological order. So it’s a chain of blocks with each block referencing the block that preceded it. The most-difficult-to-recreate chain is the best/main/longest block chain.
- Each block gets added to the blockchain after a miner finds a hash that is accurate for that particular set of transactions. That hash along with the hash of the previous block is then distributed throughout the network and by consensus added to the most recent end of the block chain.
- A list of validated blocks, each linking to its predecessor all the way to the genesis block.
- The following information all comes from this post by Consensys (5-9-2019):
What is blockchain software?
Blockchain software is like any other software. The first of its kind was Bitcoin, which was released as open source software, making it available to anyone to use or change. There are a wide variety of efforts across the blockchain ecosystem to improve upon Bitcoin’s original software. Ethereum has its own open source blockchain software. Some blockchain software is proprietary and not available to the public.
What is a blockchain database?
Historically, databases have incorporated a centralized client-server architecture, in which a sole authority controls the central server. This design means that data security, alteration, and deletion rests with a single point of failure. The decentralized architecture of blockchain databases emerged as a solution for many of the weaknesses of centralized database architecture. A blockchain network consists of a large number of distributed nodes — voluntary participants who must reach consensus and maintain a single transactional record together.
What is a blockchain system?
A blockchain system refers to all the aspects and features that go into a particular blockchain, everything from the consensus algorithm to the state machine to cryptographic functions. As Andreas Antonopoulus and Gavin Wood note in Mastering Ethereum, there are “a huge variety of blockchains with different properties” — qualifiers “help us understand the characteristics of the blockchain in question, such as open, public, decentralized, neutral, and censorship-resistant.”
How does a blockchain work?
When a digital transaction occurs in a blockchain network, it is grouped together in a cryptographically-secure “block” with other transactions that have occurred in the same time frame. The block is then broadcast to the network. A blockchain network is comprised of nodes or participants who validate and relay transaction information. The block of transactions is verified by participants called miners, who use computing power to solve a cryptographic puzzle and validate the block of transactions. The first miner to solve and validate the block is rewarded. Each verified block is connected to the previously verified block, creating a chain of blocks. One important cryptographic underpinning of blockchains is the hash function. Hashing assigns a fixed value to a string that is inputted into the system. Blockchain hashing power results in a deterministic, quickly-computable, and preimage-resistant system. Explore our knowledge base to learn more about how a blockchain works.
What is a blockchain application?
Blockchain applications are comparable to conventional software applications, except they implement a decentralized architecture and cryptoeconomic systems to increase security, foster trust, tokenize assets, and design new network incentives. Here are over 90 Ethereum apps that are currently being used across the Ethereum blockchain ecosystem, from prediction markets to smart legal agreements.
What are the benefits of blockchain technology?
Blockchain technology has a wide variety of benefits, for both global enterprises and local communities. The most commonly cited benefits of a blockchain are trusted data coordination, attack-resistance, shared IT infrastructure, tokenization, and built-in incentivization.
What is the blockchain revolution?
Blockchain is considered a disruptive technology because of its ability to safeguard personal information, reduce intermediaries, unlock digital assets, and potentially open up the global economy to millions more participants. Sometimes called the Trust Machine, blockchain technology is bringing transparency and security to digital networks across countless industries. In many ways, the blockchain revolution can be considered a revolution in trust.
- For more explanations on blockchain, visit here.
Pros of Blockchain
"Following the wild year of 2017 rampant with rogue ICOs, the lack of a coordinated body to effectively vote and fund projects led to a misguided and fragmented community. It wasn’t until recently that we started taking a step back and focusing on the things blockchain was truly good for. In practice, blockchains enable: