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How does blockchain work?

What is blockchain?
Blockchain is a distributed database that can be accessed by anyone. It is otherwise known as "distributed ledger technology" because there is no centralised authority or regulator that can manage the blockchain at its discretion.

How is blockchain different from a classical database?
A classic database is stored on dedicated servers that are controlled by the organisation that owns the database. Blockchain is not controlled by any one person or organisation, and it is its distributed architecture that ensures its security. If some of the computers on which blockchain is stored are hacked, the entire system will not be affected in any way, which is unthinkable for a classic database.

How does blockchain work?
Theoretically, any kind of data can be written to a blockchain, from monetary transactions to the complete collection of the world's literature. For the data to enter the blockchain, it must be verified, that is, verified for authenticity. In the case of Bitcoin and remittances, this is done by so-called miners. Once they verify the validity of a transaction, they write it into a block, and then it stays in the blockchain forever, and anyone can verify its authenticity. However, any such transaction must receive several confirmations from independent sources before it is considered valid.

Where is the blockchain stored?
Blockchain can be stored anywhere and is stored everywhere. There are special nodes on the network that store the full up-to-date version of the blockchain, while the other nodes simply access them when they need to verify something. You can download the full version of the blockchain from public sources, then it will be stored by you as well.

What is the difference between an open blockchain and a private blockchain?
Open blockchain is available to everyone and private blockchain is only available to a select few. There can be so many different blockchains, some of which are open and some of which are closed. They cannot interoperate yet, because each blockchain can implement its own rules of operation, and the rules of one blockchain may directly contradict the rules of another.