What is Blockchain?
Blockchain is one of the terms that you might have heard many times during the past years. In simpler terms, the word blockchain refers to two words: block; which is the digital information and chain which is the public database where this information is stored.
The digital information which is the blocks can be divided into three parts:
1- Information about transactions such as the amount, time and date of the transaction
2- Information about parties involved in the transactions using a digital surname rather than your actual name.
3- Information that makes every block distinguishable from the other. Every block has a unique code-named “hash” that allows us to differentiate between it and other blocks. These are cryptographic codes made by special algorithms.
A single blockchain has the capacity to store thousands of transaction data.
Therefore, briefly, a blockchain is a method of keeping and storing data about transactions in a safe and trusted way.
How Blockchain Works
Every time a block stores new data, it is added to the blockchain. The latter is made up of many blocks linked together. For a block to be able to be added to the blockchain the following should happen:
1- A transaction must take place
2- The transaction should be verified
3- The transaction needs to be stored in a block. It gets stored when it is verified as accurate. Once it is verified, the amount of the transaction, the digital signature of the sender and the receiver
4- The block is given a unique code that helps identify it. This code is named a “hash”. Once the block is “hashed” it will be added to the blockchain.
Every time a new block is added to the blockchain, its data become available for the public to view. Taking a look at the blockchain of any digital currency, you will be able to see the data of a transaction and the information about the time, the locations, and the party whom added the block to the blockchain.
This pushes us to ask ourselves the following question: Is Blockchain Secure?
When blocks are added to the blockchain, they are added in a chronological and linear way. This means that new blocks are added to the end of the blockchain. The position of a block on the chain is known as “height”. When a block is added in the end it becomes very hard to go back and make changes in the content of a block. This is due to the particular “hash” that every block has. Hash codes transform digital data into letters and numbers, and if any of the information is changed the code is changed as well.
Therefore, if a hacker wants to try and hack a block’s hash, they need to do changes to all the blocks of the blockchain’s hash. This will require a huge and unbelievable amount of computing power. Once a block is added, editing or deleting it can be very difficult and impossible.
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