Blockchain is the foundational technology behind cryptocurrencies. It is a distributed, immutable ledger that records transactions in a decentralized manner, removing the need for intermediaries.
Core Concepts:
- Decentralization: Blockchain networks are maintained by a network of nodes rather than a single central authority.
- Immutability: Once data is recorded in a block and confirmed, it cannot be altered or deleted, ensuring transparency.
- Consensus Mechanisms: These are protocols that validate transactions. Examples include Proof of Work (PoW), Proof of Stake (PoS), and Delegated Proof of Stake (DPoS).
- Smart Contracts: These are self-executing contracts with the agreement terms directly written into code, enabling trustless automation.
Blockchain technology has applications far beyond cryptocurrencies, including supply chain, healthcare, voting systems, and digital identity.