What is Blockchain and how does it work?
The concepts behind Blockchain can be relatively complex but at its core, Blockchain is a technology that enables trust in the transfer of value or assets between two parties without the need for a trusted middleman (like a bank for example). All the exchanges (transactions) are recorded in a list or as it is commonly referred to; a “ledger”, that is shared (distributed) between all users of the blockchain.
The detail of each transaction recorded in the list is referred to as a “block” of data. What’s important about these exchange records is that the cryptographic technology that enables Blockchain ensures that the records written into the shared database (ledger) cannot be altered by any single party or minority group of them. It is the running transaction history saved to the database (ledger) that is called the Blockchain. Every party using the blockchain has to agree on the values saved into the ledger (consensus), if one party changes one of the values in the database, the other parties, when checking their copy of the database will notice and the change is made known to the majority.
Blockchain technology facilitates the trusted exchange of assets in an environment where there is no single governing entity, transactions can’t be manipulated and that is fault tolerant due to its distributed nature (the ledger is kept by everyone).