How do Blockchains Function Like Ledgers?

How do Blockchains Function Like Ledgers?

How do Blockchains Function Like Ledgers?

It’s been over ten years already. Yet, the buzz about Blockchain, crypto, bitcoin, and its family take center stage in many discussions on innovation and a digital economy. 

As much as blockchain technology is a keenly debated topic, many people struggle with the concept of Blockchain, how it works, and the uses of this spectacular innovation. Some people only have a vague idea and need clarity on the topic. If you fall in these categories, this article will inform you what Blockchain is about and its function relative to other well-known systems such as ledgers.

What is Blockchain?

Blockchain is an innovation in record-keeping that allows people to store information in a way that cannot be changed, deleted, or hacked.

It is a system of recording transactions such that the evidence of these transactions spreads across the entire networks of users on the platform. No alterations can be made to an already completed transaction, making it a safer, more transparent means of rendering records indelible.

How Does Blockchain Work?

Blockchain is an advanced form of record keeping. Most conventional means of recording information store data in tabular form. However, as the name implies, blockchain keeps entries and records in the block structure.

When a new entry is made, it is added to a group of already existing transactions in a block. This entry is added to the chain of transactions completed on that platform with a timestamp. Every user on the Blockchain gets a share of this information, so they all record this new entry and other entries as well. 

It means the record is irreversible, and to make any changes, one would have to locate all the users that have the record of these transactions to edit it.

Now, let's double down on this explanation to simplify how the blockchain works. 

Data is stored on the blockchain in batches. These batches of data are referred to as blocks. Blocks correspond to pages of entry in a record-keeping book. 

A block of data contains three significant elements.

  • The data
  • Hash
  • Hash of the previous block


This refers to the actual information that goes out. There are many uses of the Blockchain, but each use case has specific information that makes up the block's data.


This is a secure imprint on that data that identifies it as unique. It is a value obtained through a mathematical function from a string of texts to ensure security when transmitting a message.

Hash of the previous block

Blocks are added to the chain in chronological order. Every new block adds the hash of the last to its identity, contributing to its security. This feature makes the blockchain spectacular.

Transactions on the Blockchain occur when an asset is moved from one place to another. It is recorded with information such as who moves what, where, in what state, and when? When this information is confirmed, a new block is added. 

It contains the signature of the block transaction immediately preceding it. That way, no user can add a block to the chain. Also, every block added with a hash of the previous solidifies the credibility of the last block. By extension, the blocks solidify the credibility of the entire Blockchain.

If a block has to be altered for whatsoever purpose, the blocks after it will also have to be changed to keep the information authentic. Likewise, the blocks preceding it, all the way to the genesis block have to be altered for the data in that block to be valid.

Overall, the blockchain creates a revolutionary ledger that can be trusted and secure. 

What is a Ledger?