Ali The Expert



What is Blockchain?

Blockchain is a digital database where information can be added, but not removed. This data could be anything, including transactions, insurance claims, or even shares of real estate.

How is it different from a typical database?

There are two main differences between a typical database and blockchain; the way data is structured and the way data is stored.

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How does blockchain solve the issue of digital trust?


In blockchain, decentralization refers to the transfer of control from a centralized entity to a distributed network.In a traditional system, there is one central authority managing the ledger and overseeing transactions; however, on the blockchain, transactions are validated by other nodes in the system.

Decentralization is a core component of blockchain and is responsible for facilitating a trust-less system.

Fraud: In a decentralized blockchain system, fraud is practically impossible because every member in the network has a copy of the ledger. If a member attempts to modify their own record, it will be dismissed by the other individuals in the network.

Trust: The decentralized nature of blockchain means users don’t have to place their trust in third parties; rather, they trust can that the technology will manage transactions and keep their data safe.

Other Security Features:

  • Utilizing cryptography

    Blockchain utilizes cryptography to encrypt transactions and provide security within the network.

    • Chain of Blocks

      Each new block connects to the previous block forming a chain. This prevents fraud because one transaction that is tampered with will consequently disrupt the entire chain.


      In a public blockchain, anyone can join the network and view all information on that network. In the case of cryptocurrencies, the transparency of blockchain allows users to view a history of all transactions.

      This site allows you to look up Bitcoin and Ethereum transactions. You can use the search bar to search for a specific address (public key), hash, or block number. This is a great example of how transactions are transparent and able to be viewed by anyone.


      In blockchain, the lack of third parties creates a network that operates peer-to-peer, in which transactions can happen at higher speeds and with more security and trust.


      Digital Signatures:

      A transaction relies on digital signatures; A system used to verify the authenticity of a digital message, document, or transaction.

      A digital signature system relies on public and private keys.

      Executing a Transaction using Asymmetric Encryption:

      Let’s walk through an example transaction in which Alice sends Bob a classified document.


      1. Alice and Bob exchange public keys

      2. Alice encrypts the document using Bobs public key

      3. Alice sends the document to Bob
      4. Bob uses his private key to decrypt the document

      Smart Contracts and dApps

      How are Blocks Added?

      Each block contains three key things:

      1. Data

      2. Hash of the block

      3. Hash of the previous block


      SHA-256 is the hashing algorithm used by Bitcoin. It is a one-way hashing algorithm, meaning the hash cannot be decrypted back into the original text. Try creating your own hash here!

      How are blocks verified?

      Blocks are added by having nodes verify transactions using consensus algorithms.

      The main role of consensus algorithms in the blockchain is to uphold decentralization and maintain the integrity and security of the system.

      Proof-of-Work and Proof-of-Stake are the two most well-known consensus algorithms


      • Relatively easy to implement


      • Significant energy consumption
      • Slow (not scalable)