Blockchain is a decentralized, distributed digital ledger that is used to record transactions across many computers, ensuring the data cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network.

How It Works: A Digital Public Ledger

Imagine a giant, shared digital notebook where every page is a "block." When someone sends a cryptocurrency transaction, it's recorded on the current page. Once that page is filled with a set number of transactions, it is securely "sealed" with a unique digital stamp (hash-rate) that links it to the previous page. This process creates a continuous, chronological "chain" of pages, hence the name blockchain.

Because this notebook is distributed across a network of thousands of computers (or nodes), no single person or entity owns or controls it. This is the core principle of decentralization. To change a record on a blockchain, a person would have to change not only the block containing that record, but also every subsequent block that has ever been added to the chain on every single computer in the network. This is a nearly impossible task, which makes blockchain technology incredibly secure and tamper-proof.

Why It Matters

The blockchain provides a way to establish trust between parties who do not know each other, without relying on a third-party intermediary like a bank or a government. This opens the door to a new era of transparent, secure, and peer-to-peer systems for everything from finance (DeFi) to digital identities (Web3) and digital ownership (NFTs). The security and transparency of the blockchain are what make it a foundational technology for the future.