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Folks Ed: What is Blockchain?

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A blockchain is the record keeping technology behind a cryptocurrency; it is the distributed, decentralized, public ledger that makes a cryptocurrency possible. While each cryptocurrency has its own blockchain the underlying technologies are similar. While all of this sounds complicated and hard to understand it will get easier if you break it down.


A blockchain is essentially a public database of blocks of digital information. These blocks are storage for information about transactions. This information includes the date and time, the amount of currency associated with the transaction, who is participating in the transaction (or their digital signature), and a unique hash or digital fingerprint that distinguishes that block from all others and makes it unique. Each block can be made up of multiple transactions depending on the size of the transaction data.


Now that blocks make a little more sense lets talk about how they get added to the chain. First to add something to the chain a transaction must happen. That transaction in turn must be verified with other public records of information. Once a transaction occurs and has been verified the block it is on needs a hash or unique identifier to separate it from all the other blocks, a bit like a certificate of authenticity.


Once a block has been verified and given a hash it becomes publicly viewable on the blockchain. The information publicly viewable is limited to a hash, the transaction amount, and the digital signature of the user associated with it. This information is especially secure because blockchain technology allows digital information to be stored and sent out but does not allow users to edit it. Digital trust is the future of security on the internet, the ability to trust information has become increasingly valuable and that has paved the way for blockchain technology to dominate in the future.


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