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A new technology is redefining the way we transact. If that sounds incredibly far-reaching, that's because it is.

Blockchain has the potential to change the way we buy and sell, interact with government and verify the authenticity of everything from property titles to organic vegetables.

It combines the openness of the internet with the security of cryptography to give everyone a faster, safer way to verify key information and establish trust.

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explore Blockchain
Chapter 01 What is Blockchain?

Chapter 01

What is Blockchain?

01

Blockchain technology was originally developed as part of the digital currency Bitcoin. But the two are not the same. Blockchain can support a wide range of applications, and it's already being used for peer-to-peer payment services, supply chain tracking and more.

Transaction_01
Address ljfj5721sfxx2312g2q
Size 136 Bytes
Lock Time Block: 2982385
Received 2016-09-28 14:35:01
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A Digital Record

At its heart, a blockchain is a record of transactions, like a traditional ledger. These transactions can be any movement of money, goods or secure data—a purchase at a supermarket, for example, or the assignment of a government ID number.

Secure

Blockchain is designed to store information in a way that makes it virtually impossible to add, remove or change data without being detected by other users.

Decentralized

Today, transactions are verified by a central authority—like a government or a credit card clearinghouse. Blockchain applications could replace these centralized systems with decentralized ones, where verification comes from the consensus of multiple users.

Chapter 02 How Does it Work?
Section A Recording a Transaction
Section B Building Transactions into Blocks
Section C Connecting Blocks into a Chain

Chapter 02

How Does it Work?

02

A blockchain needs to do two things: gather and order data into blocks, and then chain them together securely using cryptography.

Section A

Recording a Transaction

seller
buyer

Let's start with a simple transaction: Alice sells her car to Bill.

Transaction_02
Address 18px1vpncmsm7lu3cs79
Size 225 Bytes
Lock Time Block: 431928
Received 2016-09-25 12:59:25

The transaction information is recorded and shared with the other computers in the blockchain network.

Section B

Building Transactions into Blocks

Transaction_03
Address 18px1vpncmsm7lu3cs7
Size 225 Bytes
Lock Time Block: 431928
Received 2016-09-25 12:59:25

On the network, the record is combined with other transactions into a block—like a traditional computer database. Each transaction is time-stamped.

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When a block is complete, it also gets its own time stamp. So all information is sequential, which helps avoid duplicate entries.

Section C

Connecting Blocks into a Chain

Into the Network

The completed block is sent out across the network, where it's appended to the chain.

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Forming a Line

Other participants on the network may be sending out their own blocks at the same time.

But the time stamps ensure that data is added in the right order, and all participants have the latest version.

Securing the Chain

The key to a blockchain's security is something called a hash. It's a bit of cryptographic math that makes the links between blocks virtually unbreakable.

A hash function takes the information in each block and uses it to create the hash—a unique string of characters.

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