Blockchain is a digital ledger of all cryptocurrency transactions. It is constantly growing as “completed” blocks are added to it with a new set of recordings. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Bitcoin nodes use the block chain to differentiate legitimate Bitcoin transactions from attempts to re-spend coins that have already been spent elsewhere.
Cryptocurrencies are digital or virtual tokens that use cryptography to secure their transactions and to control the creation of new units. Cryptocurrencies are decentralized, meaning they are not subject to government or financial institution control. Bitcoin, the first and most well-known cryptocurrency, was created in 2009.
Blockchain is the underlying technology behind Bitcoin and other cryptocurrencies.
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Types of Blockchain Network in Cryptocurrencies
There are three types of blockchain: public, private, and Consortium. Each has its own features and benefits. Public blockchain is decentralized and permissionless, meaning anyone can participate in the network and there is no need for approval from a central authority. This makes public blockchain networks very secure and resistant to censorship. Bitcoin and Ethereum are examples of public blockchain.
Private blockchain is permissioned, meaning that only approved participants can join the network. This makes private blockchain networks much more efficient than public blockchain, since transaction can be verified and processed more quickly. However, private blockchain networks are less secure since they are centralized. Consortium blockchain is a hybrid of public and private blockchain.
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