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What Is Blockchain

Blockchain is a decentralized digital ledger that securely records transactions across multiple computers, ensuring transparency and immutability. Key concepts include blocks that contain transaction data, a chain linking these blocks, and consensus mechanisms like Proof of Work and Proof of Stake. Real-world applications range from cryptocurrencies to supply chain tracking and smart contracts, highlighting its importance for security, trust, and efficiency.

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5 views2 pages

What Is Blockchain

Blockchain is a decentralized digital ledger that securely records transactions across multiple computers, ensuring transparency and immutability. Key concepts include blocks that contain transaction data, a chain linking these blocks, and consensus mechanisms like Proof of Work and Proof of Stake. Real-world applications range from cryptocurrencies to supply chain tracking and smart contracts, highlighting its importance for security, trust, and efficiency.

Uploaded by

pagodana21
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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What is Blockchain?

A blockchain is a digital ledger or database that records information in a secure,


transparent, and unchangeable way. Instead of being stored on one computer, it’s
distributed across many computers (nodes).

Key Concepts

1. Block:

o A container that holds a list of transactions.

o Each block includes a timestamp, data, and a hash (a unique identifier).

o It also contains the hash of the previous block, linking them together.

2. Chain:

o The blocks are linked in chronological order, forming a chain.

o This creates a permanent record of all transactions.

3. Decentralization:

o The blockchain is not controlled by a single entity.

o It runs on a network of nodes (computers), which all have a copy of the


blockchain.

4. Consensus Mechanism:

o This is how the network agrees on which transactions are valid.

o Common methods:

▪ Proof of Work (PoW) – used by Bitcoin.

▪ Proof of Stake (PoS) – used by Ethereum 2.0.

5. Immutability:

o Once data is added to the blockchain, it can’t be changed.


o To alter any record, you'd have to change every block after it, on every node –
nearly impossible.

6. Transparency:

o Everyone can view the data on a public blockchain (like Bitcoin or Ethereum).

o But the identities behind transactions can remain anonymous.

Real-World Use Cases

• Cryptocurrencies (like Bitcoin, Ethereum): Use blockchain to record transactions.

• Supply Chain Tracking: Monitor product journey from source to consumer.

• Digital Identity: Securely manage IDs and personal data.

• Smart Contracts: Self-executing contracts that automatically enforce agreements.

Why Blockchain Matters

• Security: Cryptography protects data.

• Trust: No need for middlemen (like banks or notaries).

• Efficiency: Automates and speeds up processes.

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