What is a blockchain?

Blockchain is a technique that allows a person (or company) to transfer valuable assets to another person safely and without interference by any intermediary.

Blockchain is simply a series of records or fixed blocks of data, and is managed by a set of computers that are not owned by any one entity. Data blocks (in short block - block) are secured and bound together using encryption principles.

The blockchain network is independent, and is not subject to any central authority. It is essentially a common and unchangeable record, and the information in it is open and available to any person's access. Thus, anything based on the blockchain is inherently transparent. Transactions on the blockchain are free and have no direct cost.

How the blockchain works

Blockchain is a simple and innovative way to pass information from person A to person B in a fully automated and secure way. One party begins the transaction by creating a block. That mass is verified by thousands, perhaps millions of computers distributed throughout the network. Verified mass is then added to a series stored in the network, creating a unique record associated with other records. To rig one record, the entire chain must be rigged on millions of computers. This is practically impossible.

From a technical perspective, blockchain is just a series of data blocks, hence the name "block chains." Of course, both blocks and chain in this context refer to digital information (mass) stored in a public database (chain).

The "blocks" that make up the blockchain consist of a set of digital data. They can be seen as a page in an account book containing a set of information on certain financial transactions. Once a block is finished, a new block associated with the block before it is opened and added to the chain.

The mass is permanent, and once written it can never be changed, and generally consists of two parts:

Block header: The letterhead consists of several components, such as the software version number, the previous block hash identification code, the block registration date, transaction amounts and other information.

block body: The block board contains all the transactions installed in the block, as well as information about the persons involved in the transactions, but instead of using real names, transactions and purchases are recorded using a digital signature, which is more like a user's name, and there will be no need to provide any personal information. Each block has its own hash code that distinguishes it from the rest of the blocks. This code is composed of a long series of letters and numbers (e.g.: 0000000000000000000000094bfa4edb1245c347e4245e4418e9fe5a1d24e335b16).

One block storage capacity may be up to 1 MB of data. That means one block can absorb several thousand transactions. The blockchain, or block chain, can also consist of millions of blocks.

Regular banking transactions can be compared to blockchain transactions. The blockchain resembles a bank transaction log, while the block can be represented by a single transaction confirmed by an ATM, for example, after a user withdraws a sum of money from it.

When a block stores new data, it is added to the blockchain, which, as we said before, consists of a series of blocks interconnected with each other. In order to add mass to the blockchain, four things must happen:

There must be a transaction. such as a purchase or transfer of funds.

This transaction must be verified. There is not a single entity that specializes in verifying transactions like for example with sons. In the blockchain this task is left to a network of computers. These networks often consist of thousands (or in the case of bitcoin, about 5 million) of computers spread around the world. For example, when a purchase is made, this computer network will verify that the transaction data is correct, and ascertain the details of the purchase process, including the transaction time, the dollar amount, and the purchase participants. (We'll go back to the details of that later).

Store the transaction in a block. After verifying that the transaction data is correct, it gets the green light, the transaction amount is stored in dollars, and the digital signature of both parties to the transaction is stored in one block.

Distinguish that block with a special hash identification code. Once all block transactions are verified, they should be given a unique identification code. The block is also given the identification symbol of the latest block added to the blockchain (i.e. this block knows the mass that preceded it, and the mass that preceded it also knows the mass that preceded it, so all blocks are attached as a block chain). After giving the block a special identification code, it can be added to the block chain, or blockchain.

When this new block is added to the blockchain, it becomes available to everyone, and anyone can see it. For example, in the case of Bitcoin, a digital currency based on blockchain technology (to which we will return later), you can visit Bitcoin's blockchain site, and see that you can access transaction data. Of course, these blocks are not only stored in the site server, they are stored in all the computers that deal with this blockchain (5 million in the case of bitcoin) simultaneously, hence the blockchain prevention, as their decentralization makes it impossible to penetrate.

The reason the blockchain got people's admiration and enthusiasm is because:

decentralized. They are not owned by a single entity.

unchangeable. No one can tamper with the data inside it.

transparent. Anyone can track the data contained therein