A blockchain is a distributed database or ledger shared among a computer network’s nodes. While it gained prominence through its role in cryptocurrency systems, its applications extend beyond digital currencies. Let’s delve into the fundamentals of blockchain technology.

How Does a Blockchain Work?

Data Structure:Imagine a spreadsheet or database where information is entered and stored. In a blockchain, this data is structured into blocks.

Distributed Copies:Multiple copies of the blockchain exist on many machines (nodes).All copies must match for the blockchain to be valid.

Transaction Process:When a transaction occurs (e.g., sending cryptocurrency), it is added to a block.The block is encrypted using an algorithm, creating a hash (a unique hexadecimal number).This hash is linked to the next block, forming a chain of blocks.

Applications of Blockchain Technology

Cryptocurrencies: Bitcoin pioneered blockchain technology for secure, decentralized transactions.Other cryptocurrencies (like Ethereum) use blockchain for smart contracts and decentralized finance (DeFi).

Supply Chain Management: Track goods from origin to destination, ensuring transparency and authenticity.Prevent fraud and improve traceability.

Healthcare: Securely store patient records, ensuring privacy and interoperability.Enable efficient data sharing among healthcare providers.

Identity Verification: Create a tamper-proof digital identity for individuals.Combat identity theft and streamline authentication.

Smart Contracts: Self-executing contracts with predefined rules.Automate processes (e.g., insurance claims, real estate transactions).

Digital Voting: Enhance election security and transparency.Prevent tampering and ensure accurate results.