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Unveiling the Secrets of Blockchain Technology: A Beginner's Guide


Over the years, you might have come across terms like blockchain, ethereum, bitcoin, and many others. In this article, you will learn about the Blockchain, what it is, how it works, and some other Blockchain terminologies.

This article is intended for those with little or no knowledge about blockchain technology.

What is blockchain?

Think of a tree with multiple branches and leaves and its main root stuck in the ground. A block represents a branch, and a transaction represents a leaf.

The term's name (Blockchain) derives from a definition of a branch (a collection of leaves bundled together) and from a definition of a block (a collection of transactions bundled together). As the branches of a tree divide up and are linked together in a specific order, the block stores a reference to the previous branch.

Similar to how a tree distributes nutrients to its branches and leaves, blockchain distributes data across a network. Each node in the network has a copy of the entire blockchain, making it decentralized and resistant to single points of failure ("a single point of failure is part of a system that, if it fails, will affect the entire system).

According to the above explanation, a Blockchain is a distributed ledger consisting of data blocks shared among nodes of a computer network.

Benefits of Blockchain

A blockchain system is a decentralized system, meaning that control and decision-making are moved from a centralized to a decentralized network. Here are some of the advantages and purposes of blockchain technology:

  • Immutability: Blocks added to a chain cannot be altered or deleted, creating an immutable record of all network transactions.

  • Security: Data is impossible to manipulate or destroy due to its highly attack-resistant nature.

  • Trust: Blockchain creates trust between parties that do not know each other, enabling them to engage in business deals that otherwise would not have been possible.

  • Transparency: Transactions and data are recorded identically in multiple locations using a distributed ledger. As a result, all network participants have permission to see the same information at the same time, providing full transparency.

How Blockchain works

A Blockchain is a distributed ledger consisting of data blocks that are securely linked together via cryptographic hashes. Each block contains data, the hash of the block, and the hash of the previous block.

The data stored in the block depends on the type of blockchain; for example, in the Bitcoin blockchain, the data contains

  • Sender

  • Receiver

  • Amount

The Hash of the Block: A hash is a function that meets the encrypted demands needed to secure information and is one of the backbones of the blockchain network.

Let’s look at the image below to fully understand what we have defined above.

Blockchain demo

In the image above, we have three green boxes, each with a Block, Nonce, Data, Prev, and Hash field. You can click on this to view it properly.

  • The first section shows the block number

  • The second section shows the Nonce of that particular block. ( A Nonce is a pseudo-random number that can only be used once and is used to verify transactions or perform security checks.)

  • The third section shows the data input field that takes whatever is typed into it and converts it into a unique hash.

  • The fourth (previous) section contains the hash of the previous block from blocks 2 and above. The prefix of the first block (Genesis Block), meaning the first block of a blockchain, is all in zeros.

  • The Last section is the hash field that contains the unique key of that particular block and serves as the prev for the next block.


As a result of reading this article, you have gained a basic understanding of blockchain, its benefits, and how it works. Thanks for taking the time to read this article. If you found it interesting, please follow me and share it.

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