Blockchain technology is a transparent way of managing digital money such as cryptocurrency.
It is a method of storing information, allowing network activity of crypto to be viewed and verified by anyone.
Blockchain data is often referred to as a digital ledger, because it records transactions that have been processed and confirmed. Each “block” added to the blockchain ledger continues the data of transactions that came before, therefore “chaining” each block together. This chain creates a system of checks so that if a block or transaction was altered, an adjacent block would immediately recognize the error and invalidate that change. This also prevents any “double spending” problem, because the movement of funds is recorded once and confirmed on the blockchain for all to see.
Although blockchain technology isn’t inherently tied to finance, its design features lend itself to be suitable for that sector. Most crypto transactions such as buying and selling, sending and receiving, can be viewed openly on the blockchains that record them. Every time someone sends Bitcoin, it will be recorded within a block filled with other transactions, and confirmed by all Bitcoin miners. The miners must do a computation to compete for the role of processing block, and will be rewarded with a small amount of Bitcoin for their work. Rather than being maintained or manipulated by one central entity, a blockchain history is distributed among many computers (miners or nodes) who share the responsibility of maintaining the record and keeping it accurate, transparent, and online.