How a blockchain works
See how transactions are grouped into blocks and how each block points back to the one before it.
Shared ledger
See how blocks link
Block 02 records a transfer of 3 demo credits to Bea. A block can contain many transfers, and the network checks them against its own rules.
Read all steps
- Group transfers into a block
Block 02 records a transfer of 3 demo credits to Bea. A block can contain many transfers, and the network checks them against its own rules.
- Give each block a fingerprint
A hash is a fingerprint calculated from data. In this example, the fingerprint of Block 02 starts with 7C81. A tiny change to its contents would change its fingerprint.
- Link the next block back
Block 03 stores Block 02’s fingerprint. This creates a link that anyone checking the chain can verify.
- Spot an edited copy
Changing the transfer to 9 credits gives Block 02 a different fingerprint, 9B30 in our example. Block 03 still points to 7C81, so its link check fails.
A block groups transactions
Think of the shared ledger as a book. A block is like a new page holding a group of transactions. Computers can check that the transactions and the block follow the network’s rules before accepting the addition.
A hash links the pages
A hash is a short digital fingerprint computed from data. Each block references a hash of the previous block. Changing an earlier transaction changes the fingerprints that depend on it, so later links no longer match the altered history.
Agreeing on a history
Computers on the network check blocks independently. If two valid histories temporarily compete, network rules determine which history to follow. That shared process is part of how a public blockchain keeps one usable record.