Blockchain technology is a decentralized and distributed digital ledger system that records transactions across multiple computers in a way that ensures security, transparency, and immutability. It operates without the need for a central authority, relying instead on a network of participants to validate and record transactions.
Key Features of Blockchain Technology:
1. Decentralization: Data is distributed across a network of computers (nodes), reducing the risk of centralized control or failure.
2. Immutability: Once data is recorded in a blockchain, it cannot be altered or deleted, ensuring data integrity.
3. Transparency: All participants in the network can view the transactions, promoting accountability.
4. Security: Cryptographic techniques secure the data, making it resistant to unauthorized access and tampering.
5. Consensus Mechanisms: Transactions are validated by network participants through mechanisms like Proof of Work (PoW), Proof of Stake (PoS), or others.
Components of a Blockchain:
Blocks: Each block contains transaction data, a timestamp, and a reference to the previous block.
Chains: Blocks are linked together in a sequential manner, forming a chain.
Nodes: Computers connected to the blockchain network that maintain copies of the blockchain and validate transactions.
Smart Contracts