Blockchain: What is it?

The blockchain is a term which is coined a lot when it comes to cryptocurrency. It is a technology that has revised the way we perceive transactions.

In this read, we will see what is Blockchain, how it can be useful and how they are being used?

What is Blockchain?

As the name goes Blockchain is a distributed ledger where that contains blocks of information, this information can vary in any form, what matters is how the information is being stored and processed in it. The concept evolved when a technique originally described in 1991 by a group of researchers, who had the idea of time-stamping the digital documents so that it is not possible to backdate them or tamper with the data.

In the year 2009, Satoshi Nakamoto used this digital time-stamping concept to create a digital cryptocurrency which is popularly known as Bitcoin.

A Blockchain has a very fundamental property which makes it so popular, once any data is being fed into the blockchain, it is nearly impossible to tamper with the data.

How does the Blockchain work?

There are 3 parts to a Blockchain

  • Data
  • Hash
  • Hash of the previous block

The data refers to any data that the block would contain, the data typically contains the Sender and the Receiver and the quantity of the coins or tokens that are to be transferred.


The hash can be referred to as the digital fingerprint of the transaction, it identifies the block and all of its content. Remember a Hash is always unique and it will not be the same for any of the blocks in the Blockchain.

Once a block is created, it’s Hash is being calculated, changing something inside the block will cause the Hash to change. Hashes are used to check and detect whether there have been any changes in the blocks.

Hash of the previous Block

The final element of the blockchain is the Hash of the previous block, this is the element which connects the previous block with the existing block, effectively creating a chain.

A diagram explaining the process of Blockchain.
Image Courtesy: Simply Explained

Now take a look at the image carefully, every block has got it’s own Hash and also the Previous Hash, so the Hash of block 2 will be the previous Hash for block 3 and the Hash of block 1 will be the previous Hash of block 2.

The first block will not have any previous hash, as it cannot point to any block. This block is known as the genesis block.

Also Read: Bitcoin, What is it?

What happens if someone tampers with the blocks?

Now let’s take an example if someone tries to tamper with the second block.

A diagram of tampering with the process of Blockchain.
Image Courtesy: Simply Explained

If someone tampers with the block the hash of that block will change and the block 3 which contains the previous hash of the 2nd block will show that the Hash of the 2nd block is not matching. This will make all the following blocks invalid.

Also Read: Ethereum: What is it?

Blockchain secures itself from another important feature, Blockchain works on a peer to peer platform, where anyone is free to join the network. When someone joins the network, one gets the full ledger of the existing Blockchain one has entered into. The users can use this to verify the new blocks that are to be added to the blockchain, once the block is being verified by all the users, it is then added to the blockchain.

This is where all the users/nodes draw a consensus, i.e agree with the existing Blockchain, decide which blocks are to be declared valid and which blocks are to be declared invalid. Blocks which are tampered with will be rejected by the other nodes in the network and only those blocks which are not being tampered with will be accepted.

This is how the Blockchain technology works, hope it helped you and gave you a brief insight into the topic.

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