What Is A Blockchain ? Blockchain Explained Simply

3 min readSep 21, 2021

Blockchain Explained Simply

A blockchain is simply a database meaning it contains data. A database is a collection of information that is stored electronically on a computer system. Unlike traditional databases blockchains store data in blocks. Keep in mind that all Blockchains are databases but not all databases are block chains.

A block is just a collection of data or records. For most blockchains like Bitcoin this data is just a list of transactions (a ledger) and for some others like Ethereum and Cardano the data would include smart contracts.

Fig. 1: Visualization of blocks on a blockchain Source: https://www.spheregen.com/blockchain-technology-basics/
Fig 2: Another visualization of blocks on a blockchain Source: https://www.nist.gov/blockchain

When a block is complete meaning it is full of some data (like a list of transactions), it is then added to the network through a process called mining.

Some blockchains have native coins with the same name like Bitcoin, while other blockchains have a different name from their coin, like the Blockchain Cardano that uses the native ADA coin or like the blockchain Ethereum that uses the coin ETH.

A blockchain uses consensus protocols to verify a transaction. There are different types of consensus protocols like proof of work (PoW), proof of Stake (PoS), proof of space (PoSpace) and DPoS (Delegated Proof of Stake). The consensus of blockchain is that all nodes (a representation of another object like computers) maintain the same distributed ledger. The main two consensus protocols are PoW and PoS.

Fig 3: Image of Proof of Work Flow: Image Source

Bitcoin uses proof of work (PoW) as its consensus protocol, which is energy and time-intensive. To learn more about blockchain consensus, check out this white paper on the topic.

Types of Blockchains

There are three basic types of blockchains: private blockchain, consortium blockchain and public blockchain.