Blockchain is a decentralized and distributed ledger technology that enables secure, transparent, and tamper-resistant record-keeping of transactions. It consists of a chain of blocks, each containing a list of transactions. Here are some key characteristics:
Decentralization: Instead of relying on a central authority (like a bank or government), blockchain distributes its ledger across a network of computers, known as nodes. This decentralization enhances security and removes the need for a single point of control.
Consensus: Transactions are added to the blockchain through a consensus mechanism, where a majority of the network agrees that the transactions are valid. This process helps maintain the integrity of the ledger.
Immutability: Once a block is added to the blockchain, it is very difficult to alter its contents. This is achieved through cryptographic hashing and the interconnected nature of the blocks.
Transparency: The entire transaction history is stored in a public ledger that is accessible to all participants in the network. This transparency builds trust among users.
Smart Contracts: Blockchain can execute self-executing contracts, known as smart contracts. These are programmable scripts that automatically enforce and execute the terms of a contract when predefined conditions are met.
Security: The use of cryptographic techniques ensures the security and integrity of transactions on the blockchain.
Blockchain technology is the underlying foundation for many cryptocurrencies, including Bitcoin and Ethereum. However, its applications extend beyond cryptocurrencies, finding use in various industries such as finance, supply chain, healthcare, and more.
