A chain of blocks

Apr 28, 2024 1:13:57 AM

The term blockchain is due to the fact that its data structure is that of a chain of blocks. Thinking of the blockchain as a ledger that stores transactions, each block can be understood as a ledger page, which contains an arbitrary number of transactions. The blocks are cryptographically linked, thus ensuring the immutability of the ledger. Any attempt to modify a single transaction in any past block will affect all subsequent blocks in the chain, which indicates tempering.

The first block in the chain is called the genesis block and is defined by the protocol. To be part of the network, all participants need to agree on the genesis block. From then on, it is the protocol’s consensus mechanism that will ensure that all participants continue to agree on the correct chain of blocks. As mentioned before, various protocols may implement different consensus mechanisms. We are going to talk more about that in a later class.

The purpose of the blockchain does not necessarily require the ledger to be block-structured. In fact, some blockchains, despite their name, are not structures in blocks, but only in transactions. For this reason, the term blockchain is often substituted for Distributed Ledger Technology, DLT for short.

After the success of Bitcoin and other blockchains, DLT technology has been widely studied and several new implementations are now in the development stage. Block structure or not, the main goal is to create distributed ledgers that are immutable, tamper resistant and fully decentralized.