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Blockchain Basics Explained

“Blockchain” is currently one of those overused fashion tech words where most who hear about it have no idea what it truly is. You see the word blockchain coming-up everywhere in the tech and non-tech media. Most already know that blockchain’s popularity, with no doubt, comes from it’s cryptocurrency applications.

Blockchain is the technical foundation of the innovation that makes cryptocurrency possible.

In the explanation below we will use graphics to illustrate the basic components that make-up a blockchain.


A simple way to capture what blockchain does is defined as a continuously growing list of records, those groupings of records are called blocks.


Blocks are linked and secured using cryptography. Each block will typically have a link back to the previous block with relevant transaction history.

The linking history is then distributed amongst a network of peer record keepers.

Links cannot be undone because the flow of link building and distributed record keeping is strictly adhered to to ensure clear transparent hand shakes between record blocks.

Each instance of recorded blockchain transactions is often referred to as a ledger.

Ledgers are distributed amongst many network nodes, creating a decentralized network of ledgers, which maximizes the transparency and trust within the network.


This is a very simplistic explanation covers the core components of the blockchain in words and graphics. Most explanations you find of blockchain get caught up in the weeds. All most need is a high level understanding of how it works and associated benefits.

In future posts I will go deeper into each of blockchain components to describe core features and terminology.

Some uses for this type of distributed cryptography record keeping are identity management, records management, transaction processing, food traceability, and voting. Blockchain with distributed ledgers and cryptography provides these applications with security and distributed knowledge that is harder to hack than your traditional data storage and encryption.

About me: I’m mostly focused on internet growth, culture, and startups and am the COO at Wafer Inc. When I can find time between being a co-founder and life I enjoy writing, mostly here and occasionally on Linkedin. If you enjoy my writing, subscribe or follow me on LinkedIn to see more in the future.


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