Understanding The Basics Of Blockchain Technology
The only way to understand web3 is by understanding the basics of blockchain technology and how it works.
To understand the full concept of web3, it’s really important to understand what blockchain is and how it works. The only way to understand web3 is by understanding the basics of blockchain technology and how it works. When you see or hear the word “blockchain” what comes to your mind is cryptocurrency or sometimes NFTs but the question you should ask is, what is this blockchain everyone keeps talking about and how does it work? For a better understanding follow up this article closely, at the end of this article you should be able to understand the basics of blockchain.
What is blockchain?
A blockchain is an immutable or unchangeable ledger of information. It’s also a chain of blocks, each containing information of transactions, telling a linear story about all transactions that have ever taken place. Once a transaction is added to the block and the block is added to the chain it can never be modified so the information becomes permanent and it therefore immutable.
What makes blockchain technology popular is how they ensure this immutability. For example, I can easily make changes in the history of a transaction that is recorded in a ledger, I can alter or remove a transaction from the history of the ledger, all I have to do is to find the right entry then make my changes and make sure the ledger is balanced. No one will know that I’ve tampered with the ledger unless I made a mistake.
This is not possible on blockchain because each new block contains an encrypted copy of all the previous blocks, that way if I go in to try to change a transaction in the past block, the block would no longer match the encrypted copy in the next block and everyone can see the chain has been tampered with. This is achieved by using an encrypted algorithm that is easy to test, namely SHA-256.
For example, if I insert a line of text into a SHA-256 calculator it will generate a unique encrypted hash (DsiqBdRnbCrVD9Ez5XnkMgeArfgyrPJiTDP). A string of random numbers and letters representing that line of text. If you enter the same line of text you will get the same hash.
- For example, if I insert a line of text “My new file” into the SHA-256 calculator it will generate a unique encrypted hash 268e9c54c00e0342198bffe3a4c7c8ab405. If I insert the same line of text again “My new file” it will return that exact same hash 268e9c54c00e0342198bffe3a4c7c8ab405.
- But if I change any letter from the line of text “my new file” it will generate a different unique hash b40521559028f7079e75d81e4343a5a82. Everyone can see that the chain has been tampered. It makes it easier to see that something has changed from the original sentence. This makes it easier to compare two copies of the same data, put them in the SHA-256 calculator and see if the hashes matched that means the copies are identical but if the results are different that means the data have been tampered.
On blockchain, each block contains the hash of the previous block, which contains the hash of the previous block, which contains the hash of the previous block, etc. So if I changed a block in the past by anyway, this new hash from that block will not match the hash stored in that next block.
In conclusion, this is what makes blockchain immutable and why the idea of blockchain is so appealing. We get a permanent and unchangeable record of every transaction that has taken place on the blockchain.
