Back to my definition of Blockchain and the ‘ distributed ledger’ bit

‘’Blockchain’’ is a descriptive term for a cocktail of technologies comprising; cryptography, peer-to-peer connectivity and consensus algorithms which, when combined, creates a shared database that manifests as a secure ‘cradle to grave’ decentralised digital ledger within which assets may be recorded, accessed and transacted.

The word ‘’Blockchain’’ is derived from the fact that any transaction of an asset is recorded on the digital ledger as a ‘’stand-alone’’ entry, or block, and within that entry there are direct links and references to the previous transaction involving that asset, which creates a chain of data upon which the integrity of the database sits.

This security of the chain of data comes from linking each block of data with conditional cryptographic reference outputs resulting in a consensus acknowledgment, which creates an immutable record on that data base.”

Ledgers are as old as money itself. they are a simple and efficient way of keeping a record of a transaction.

An Old Ledger

In its simplest form, a decentralised ledger is a database, held and updated independently, by each participant (i.e. your computer) on a large network. The ledger’s records are not communicated to each member of the network by a central authority but are independently created i.e. when you enter a transaction on your computer. This transaction is then sent to and held by every computer on that network. That is, every single computer on the network processes every transaction, coming to its own determination and then voting on those results, which gives a consensus when the majority agree with the conclusions.

Centralised vs Decentralised Vs Distributed

Note: there is no agreed definition of Decentralised vs Distributed and many also describe Blockchain as ‘ A Distributed Ledger’. In practice many Blockchains become more Decentralised than Distributed. The most important aspect here is that it is not Centralised.

All the computers in the network then have the exact same record for all the transactions. These are the records of  the transfer and ownership of some type of asset i.e money as in bitcoin or property or even stages of a process, such as the logistics of a health drug as it passes through the distribution channel.

This is one of the fundamental aspects of Blockchain.