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What Is Blockchain Technology?

The definition of blockchain technology is that referred to the Bitcoin technology developed by Satoshi Nakamoto, in which the blockchain is an integral part of it; Unlike the new word ‘blockchain ‘ introduced by different companies and authors to refer to Bitcoin technology as a whole.

A blockchain is also known as a distributed ledger. This is a distributed database that registers information blocks and interweaves them to facilitate the retrieval of information and verification that it has not been changed.

The information blocks are linked by hash pointers that connect the current block with the previous one and so on until you reach the Genesis block.

The blockchain is stored by all those nodes on the network that are kept in sync with it. Each blockchain of blocks contains information regarding transactions relating to a period (grouped in a structure called Merkle Tree), the cryptographic address (hash pointer) of the previous block, and a unique arbitrary number (nonce).

Hash pointer function

The information contained in each block is registered in the form of cryptographic hash, which allows easy verification, but makes it impossible to recreate the input data. Bitcoin uses the SHA-256 cryptographic hash function, which implies that its hash pointers are a fixed size of 256 bit.

A hash function is any function that can be used to map data from an arbitrary size to fixed-size data in a reasonable amount of time. The values generated by a hash function are called hash values, hash codes, or just hash.

Merkle tree function

The transactions or data are logged in each block of the chain of blocks in a cryptographic structure of pointers hash called Tree Merkle, due to its inventor Ralph Merkle. This structure groups the blocks of information in pairs and generates a hash for each block of data.

Then, the generated hashes are regrouped in pairs and generate a new hash that in turn is grouped with another and is repeated way up the tree to reach a single block, the root of the tree, which is called root hash pointer, and is registered in the direction N of the current block (block hash) in order to reduce the space occupied by each block

In addition, this hash pointer structure allows you to traverse any point of the tree to verify that the data has not been tampered with, as with the blockchain, if someone manipulates a block of data at the bottom of the tree, it will make the Hash pointer that is one level above does not match, and even if you continue to manipulate this block.

The change will eventually propagate to the top of the tree where it will not be able to manipulate the hash pointer that we have stored by belonging to another structure (block string) in which a hash has also been generated using the root hash as input.

So, again, you will detect any attempt to manipulate any piece of data by simply registering the hash pointer at the top.

NONCE

In cryptography, the term nonce is used to refer to a value which can only be used once. This unique or nonce number is a random number issued by the miners through the work test (PoW) that serves to authenticate the current block and prevent the information from being reused or changed without doing all the work again.

In a brief way, we will give 6 key points that will explain how Blockchain technology works:

  1. A wants to send money to B
  2. The transaction is represented on the network as a “block”.
  3. The block is transmitted to all parts of the Network
  4. Those on the network approve that the transaction is valid
  5. After approval, the block can then be added to the chain, which provides an indelible and transparent record on the transactions.
  6. Money moves on and reaches its recipient.

In conclusion, Blockchain technology is one of the most popular phrases in recent times. This is also a concept that poses a huge revolution not only in our economy but in all kinds of fields.

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