About blockchain

Blockchain is a distributed database shared by many users within one computer network. Blockchain is commonly known for its central role in cryptocurrency systems like Bitcoin. Distributed ledger technology (DLT) guarantees the accuracy and security of data recording without the need for a trusted third party.

Data structuring is one of the major differences between a regular database and a blockchain. A blockchain collects information together in blocks. They have certain storage capacities and, when filled, are closed and linked to the previously filled block, forming a chain of data. All new information that follows the newly added block is compiled into a freshly formed block, which, once filled, will also be added to the chain.

Consequently, it is impossible to fake registries with data on asset owners in the blockchain because this information is stored on the computers of a great number of network participants. A block, when filled, becomes part of a single chronological timeline. Each block in a chain contains the time and result of all previously conducted transactions.

How blockchain works

The goal of blockchain is to allow digital information to be recorded and distributed, but not edited. A blockchain is the basis for immutable ledgers or transaction records that cannot be changed, deleted, or destroyed. Therefore, a blockchain is also known as distributed ledger technology (DLT).

The concept of blockchain was introduced as a research project in 1991. Since then, distributed ledger technology (DLT) has developed rapidly thanks to the creation of various cryptocurrencies, decentralized finance (DeFi), non-fungible tokens (NFTs), and smart contracts.