Blockchain is a type of distributed ledger technology (DLT) that uses a chain of blocks to store and manage data. Each block in the chain contains a number of transactions, and once a block is added to the chain, the data it contains cannot be altered. This makes the technology highly secure and tamper-proof.
A blockchain network consists of a number of nodes, which are computers or other devices that participate in the network. Each node maintains a copy of the entire blockchain, and when a new transaction is added to the network, it is broadcast to all the nodes.
The process of adding a new block to the chain begins with the creation of a new block, which is a collection of one or more transactions. The block is then broadcast to the network, and each node adds it to its copy of the blockchain after verifying the transactions it contains.
This process of verifying transactions is done through a consensus mechanism, which is a set of rules that the nodes in the network use to agree on the state of the blockchain. One of the most popular consensus mechanisms used in blockchain networks is called proof-of-work (PoW). In a PoW-based network, nodes must solve a complex mathematical puzzle in order to add a new block to the chain. This process is called mining, and the node that solves the puzzle first is rewarded with a certain number of cryptocurrency.
Once a block has been added to the blockchain, the data it contains becomes part of the permanent record of the network. This makes the technology useful for a variety of applications, such as digital currencies, smart contracts, and supply chain management.
One of the key benefits of blockchain technology is its decentralization. Since the data is stored across a large number of nodes, there is no central point of control or failure. This makes the technology highly resistant to tampering or hacking. Additionally, the use of a consensus mechanism ensures that the network is able to reach agreement on the state of the blockchain, even in the presence of malicious actors.
Overall, blockchain technology is a powerful and versatile tool that has the potential to revolutionize a wide range of industries.
It's important to keep in mind that the use of Blockchain is not limited to the one most well-know implementation of it which is the one used for Bitcoin, and it has various implementation with different use cases.
"It's very attractive to the libertarian viewpoint if we can explain it properly. I'm better with code than with words though."