Blockchain

Blockchain is a recent technology that allows data to be securely stored in a decentralised distributed ledger. Blockchain technology has gained widespread popularity since the creation of Bitcoin in 2009 and is today well-known for the crucial role it plays in cryptocurrency networks.

A blockchain is a unique type of database that uses cryptography to secure the information stored on it. It operates through a decentralised network of computers around the globe. These computers, also called nodes, work together to maintain the blockchain and validate the information added to it. In the case of cryptocurrencies, the blockchain stores transactional data.Network participants initiate transactions, which are requests to add or update information on the blockchain. In the context of cryptocurrencies like Bitcoin, transactions involve the transfer of digital assets from one participant to another. In other blockchain applications, transactions can represent different types of data, such as contracts, ownership records, or supply chain events.When a participant initiates a transaction, it is broadcast to the network. Nodes on the network verify the transaction is valid by ensuring the sender has the necessary funds or authority to perform the action. If it is valid, it is grouped with other transactions into a block. For example, a Bitcoin block can store around 2,000 transactions and has a size of 1 MB.Then, the network gathers a set of validated transactions and organises them into a block. Each block typically contains a predefined number of transactions, a timestamp, a reference to the previous block (forming a chain of blocks), and a cryptographic hash of its contents.

The validation process will depend on the consensus protocol used by the blockchain. Indeed, before a new block can be added to the blockchain, the network must reach a consensus on its validity. Different blockchains use various consensus protocols to achieve thisFor example, Bitcoin miners need to compete and solve complex mathematical puzzles using computing power This consensus protocol is Proof of Work (PoW). The first miner to solve the puzzle gets the right to add the next block and is rewarded with newly created cryptocurrency and transaction fees. Other popular consensus protocols include Proof of Stake (PoS), like for Ethereum, or Delegated Proof of Stake (DPoS).

Yes, blockchains are very secure decentralised databases. The technology used in blockchains makes it nearly impossible to alter data stored on blockchains after validation. Indeed, as blocks are linked together through cryptographic hashing, and each block contains data from the previous block. This design ensures that once a block is added to the blockchain, it is practically impossible to alter or delete the data within it without changing all subsequent blocks. This immutability and security are key characteristics of blockchains.In summary, a blockchain operates as a decentralised, consensus-driven ledger that records transactions and data in a secure and transparent way. The combination of cryptographic techniques, decentralisation, and consensus mechanisms ensures the integrity and reliability of the blockchain, making it suitable for a wide range of applications beyond cryptocurrencies.