What is a Blockchain?
Beginner Lesson | 2 mins
Information

What is a Blockchain?

A blockchain is a distributed database or ledger that is shared among the nodes of a computer network. As a database, the blockchain stores information electronically, in a digital format. Blockchains are best known for their crucial role in cryptocurrency systems, such as Bitcoin or Ethereum, for maintaining a secure and decentralized record of transactions. The innovation of a blockchain is that it guarantees the fidelity and security of records and data, and generates trust without the need for a third party.

Whenever someone sends money (which creates a transaction), a hash is created. A hash is like a secret word. The only way to know what the secret word is, is if you combine a few other words you always know.  A blockchain hash works in the same way. By combining some of the information about a recently solved math problem [pause x-weak]  and some information about the current transaction, you can ensure that no one can fake our transaction again. Not even yourself.

Each transaction is contained within some notes about that recently solved math problem.  These notes are called "blocks". When we hash the blocks and the transactions together, it creates a chain with links that are impossible to replace. All chains are recorded publicly, and can never be changed again. As such, transactions and blocks are not able to be faked or undone.