What is Blockchain?

You may not understand what a blockchain is or how they work, but you probably recognize that they are somehow connected to the worlds of cryptocurrency and NFTs.

What Is a Blockchain and How Does It Work?

Blockchains are kind of like that library card that you’d find in the back of a book in elementary school. You could see who had it last, how long they kept it, and you’d put your name in it when you checked it out.

To get a better understanding of blockchain, you’ll need a few vocabulary words.

Block: a data set containing information that is hashed and linked to the previous block. Data: the kind of information each block contains depends on the type of blockchain. Hash: the hash is a unique digital identifier of the block, much like a fingerprint. P2P Network: this stands for peer-to-peer network.

Nodes: are participants in a network that have a full or partial history of the blockchain. Proof of work: is a type of consensus algorithm used in mining that disincentivizes block tampering by rewarding network participants who update and maintain the ledger with cryptocurrency Smart contract: an agreement that is based on computer code.

Understanding Blockchain: What’s an NFT

NFTs (Non-fungible Tokens), are blocks that are designed as artwork or collectibles. They function in the same block pattern for trading and are very popular.

Getting Started in Blockchain Investing

One of the best things about blockchain is how secure it is. Blocks are tough to tamper with since there is proof of work time limits, and there is a decentralized network of participants following the rules (i.e., computer code), which keeps everything in check.

Swipe up now to read the full post!