How does a blockchain work – Simply Explained

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Blockchain Technology -


Blockchains are incredibly popular now a days. But what is a blockchain? How accomplish they work, what issues do they explain and how might they be utilized? Like the name demonstrates, a blockchain is a chain of obstructs that contains information.

Technique Origin

This strategy was initially described in 1991 by a gathering of scientists and was initially expected to timestamp digital documents so it’s impractical to backdate them or to tamper with them. Practically like a legal official. Anyway it passed by for the most part unused until it was adapted by Satoshi Nakamoto in 2009 to make the advanced digital cryptocurrency Bitcoin.

A blockchain is a conveyed record that is totally open to anybody. They have a interesting property: when a few information has been recorded inside a blockchain, it turns out to be exceptionally hard to transform it.

So how does that work?

Well, let’s take a closer look at a block. Each block contains a few information, the hash of the block and the hash of the previous block . The information that is put away inside a block relies upon the type of blockchain.

For Example– The Bitcoin Blockchain

The Bitcoin blockchain stores the details information about a transaction in here, for example, the sender, beneficiary and measure of coins.

A block also has a hash. You can compare a hash to a fingerprint. It identifies a block and all of its content sand it’s always unique, just as a fingerprint. Once a block is created, it’s hash is being determined. Changing something inside the block will make the hash change. So in other words: hashes are very useful when you need to recognize changes to blocks. If the fingerprint of a block changes, it never again is a similar block.


The third component inside each block is the hash of the previous block. This effectively creates a chain of block sand it’s this technique that makes a blockchain so secure.

Let’s take an example. Here we have a chain of 3 blocks. As you can see in above figure, each block has a hash and the hash of the previous block. So block number 3 focuses to block number 2 and number 2 focuses to number 1. Presently the first block is a bit special, it cannot point to previous blocks because it’s the first one. We call this the genesis block.

Genesis block

Now let’s say that you tamper with the second block. This makes the hash of the block to change as well. Thus that will make block 3 and all following blocks invalid because they no longer store a valid hash of the previous block. So changing a single block will make every after blocks invalid. But utilizing hashes is not enough to prevent tampering.

Computers nowadays are quick and can calculate countless hashes every second. You could effectively tamper with a block and recalculate all the hashes of different blocks to make your blockchain valid again. So to mitigate this, blockchains have something refer to as verification of-work. It’s a technique that slows down the creation of new blocks.

Tamper Block

In Bitcoins case: it takes around 10 minutes to calculate the necessary proof-of-work and add a new block to the chain. This mechanism makes it difficult to tamper with the blocks, because if you tamper with 1 block, you’ll have to recalculate the proof-of-work for all the following blocks. So the security of a blockchain comes from its creative use of hashing and the evidence-of-work mechanism.

But there is one more way that blockchain secure themselves and that’s by being distributed. Rather than using a central entity to manage the chain, blockchains use a peer-to-peer network and anyone is allowed to join. When someone joins this network, he gets the full copy of the blockchain information. The node can utilize this to confirm that everything is still in order. Now let’s see what happens when someone creates a new block.

That new block is send to everyone on the network. Each hub then verifies the block to ensure that it hasn’t been tampered with.In the case of everything looks at, each node adds this block to their own blockchain. All the hubs in this network create consensus. They agree about what blocks are valid and which are invalid.


Blocks that are tampered with will be rejected by other nodes in the network. So to effectively tamper with a blockchain you’ll need to tamper with all blocks on the chain, re-try the verification-of-work for each block and take control of more than 50% of the peer-to-peer network. At exactly that point will your tampered block become acknowledged by every other person. This is almost impossible to do! Blockchains are also constantly evolving. One of the more recent developments is the creation of smart contracts.

These agreements are simple programs that are stored on the blockchain and can be used to automatically exchange coins based on specific conditions. The creation of blockchain technology peaked a lot of people’s interest. Soon, others realized that the technology could be used for other things like storing clinical records, making a computerized legal official, creating a digital notary or even collecting taxes. So now you know what a blockchain is, how it works on basic level information and what problems it solves.

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