What is Blockchain In Simple English

What is Blockchain In Simple English

The word blockchain today has become more popular and many people are confused by all the new terms that are associated with this new technology. In this post I will try to answer in simple English what blockchain means and how its blocks are created.

The idea of having a distributed ledger was first conceived by David Chaum in 1983 however it was not until 2009 that blockchain came to the attention of the world through an anonymous whitepaper that gave birth to the Bitcoin written by the famous yet unknown figure “Satoshi Nakamoto”. This new cryptocurrency was the first of its kind and what many people liked about this new currency was its unique properties of decentralization and the ability to send money to other people around the world without having a centralized entity like a bank being the middleman of that transaction.

So what exactly is blockchain technology? Well it is a secure database ledger that makes transactional records and while ensuring security, transparency, and decentralization. All of these qualities are important to ensure that all transactions are not double dated and nobody can alter the transaction. Through the use of digital signature or encryption no one person can temper with the ledger or make any changes to the ledger. Which makes the blockchain the most secure database for transacting and storing data that cant be copied i.e money, property, ect.

A blockchain is a chain of blocks that contain data or information. The technology uses what is called hashes to store information, these hashes are unique mathematical codes that are used to verify every transaction. When a hash is modified it will affect the rest of the blocks in the chain because they are dependent on each other. This method of interdependence of these chains makes the blockchain the most secure system today.

While transactions take place on the blockchain, there are nodes on the network that validate each transaction made on the blockchain. In Bitcoin blockchain these nodes are called miners and their job is to validate transactions through proof-of-work in the network. In order for a transaction to be valid, each block must refer to the hash of its preceding block. If a hacker tries to attack the network and change information of any specific block, the hash attached to the block will also get modified.

The breach will be detected as the modified hash will not match with the original one. This ensures that the blockchain is unalterable as if any change which is made to the chain of blocks will be reflected throughout the entire network and will be detected easily.

Blockchain technology holds enormous potential for application in different industries including financial, healthcare, property and etc. When we explore these applications we see the potential of this revolutionary technology that will simplify our online work and help us work more efficiently in our respective industries. In my next article I will explore more blockchain applications.