The Blockchain is the Core of Bitcoin. The individual Users, including Exchanges and Broker, check with the Data of the Block Chain whether a Transaction is valid. The Blockchain contains all Transactions since Bitcoin, and therefore you can check if a Transaction is valid or comes out of nowhere, or if an Amount has been issued multiple Times (which of course is not allowed). To Simplify the Organization, Transactions are grouped into Blocks, with each Block currently not more than 1 MB in Size. The Blockchain can’t be changed at a later Time and it is also quite difficult to add new Blocks to the Blockchain. But once something is stored in the Blockchain, you can confidently consider this after a short wait as the Truth and trust it.
The Blockchain is, as the Name implies, a Chain of Blocks. On average, one Block is attached to this Chain every 10 Minutes, so that today there are several thousand Blocks. Occasionally it happens that two new Blocks (X and Y) are found almost at the same time. In this Case, there are two different Blockchains worldwide, one Ending in Block X, the other in Block Y. Each individual Machine chooses the Blockchain with the new Block first seen, and ignores the Blockchain that ends in the other new Block. But this Disagreement is quickly resolved, as each new Block is always appended to the longest valid Chain. So if a Miner finds another new Block based on Block X, that Blockchain is longer and the entire Network is in Agreement again about which Blockchain is being looked at.
Many Cryptocurrencies are based on this Principle, and new Currencies which use this Mechanism are constantly being created, e.g. Bitcoin Cash and Bitcoin Gold. In the next few Days we will explain You the Difference between Soft Fork and Hard Fork, so stay tuned!
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