How Blockchain Technology Works? | njemagazine by Nazish Jamali

How Blockchain Technology Works? | njemagazine by Nazish Jamali

Blockchain means a system where we put or keep our records safe, a system that makes it difficult or impossible to change, misuse, hack, or cheat the system. It is known as a digital ledger or register which saves our data with high security. Blockchain is the digital record keeper of transactions which is distributed throughout the computer system on blockchain. 1n 1991 blockchain was introduced by a group of researchers, and in 2009 by using the blockchain bitcoin (a digital currency) was introduced.

There are three complementary definitions for blockchain technology. If we discuss the blockchain.

Technically: it is the back-end data that maintains a distributed ledger that can be inspected openly.

Business-wise: it is an exchange network for moving transactions, we can move our transactions without the assistance or help of the intermediaries or third parties.

Legally: it is validated transactions that replace previously trusted entities.

How Blockchain Technology Works? 

Let’s discuss blockchain technology with the help of examples: consider that you have documents and you want to put them in organized folders. By filling the documents into folders you get the first folder full, now you take another folder and filling it with documents, it is filled now you get another folder for documents and do the same vice versa. This is making a chain of folders for particular documents. Same as in blockchain technology there are some blocks that contain data information of the transactions. For each transaction, there is a different previous hash and current hash. Each block has data which have the details about the transaction that to whom you are sending money and by whom, and also the amount of transaction also mentioned there in the block. The first block is known as the genesis block because its previous hash has no data any block which considers as 0000, all the upcoming blocks have different current hash according to the transactions data which are linked with one another with the help of hash, Hash is like a fingerprint which changes according to data and interconnects the blocks. And no one can easily change the data in these blocks, if someone tries to change it then all blocks will be invalid and not get interlinked with one another also showing the invalid message. This means if one block in one chain was changed, it would be immediately apparent it had been tampered with. If hackers wanted to corrupt a blockchain system, they would have to change every block in the chain, across all of the distributed versions of the chain.