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What is ledger in blockchain?

Published in Blockchain Basics 2 mins read

A blockchain ledger is essentially a digital record of transactions, organized into blocks and chained together in chronological order. This structure ensures data integrity and transparency.

Understanding the Blockchain Ledger

Here's a breakdown of what makes up a blockchain ledger:

  • Chain of Blocks: The ledger is formed by a series of interconnected blocks. Each block contains transaction records.
  • Data Integrity: Because each block is linked to the previous one using cryptographic hashing, it's difficult to alter any part of the chain without detection.
  • Distributed Nature: The ledger isn't stored in one central location, but rather distributed across numerous computers, increasing resilience and transparency.

Key Features of a Blockchain Ledger

Feature Description
Immutability Once data is recorded on the blockchain, it cannot be altered or deleted, which provides high data integrity.
Transparency All participants in the network have access to a copy of the ledger, making transactions verifiable.
Decentralization Instead of one single authority, the ledger is distributed amongst multiple participants, reducing the risk of fraud or tampering.
Chronological Ordering Transactions are recorded in chronological order in a series of linked blocks, making it auditable and easily traceable.

How a Blockchain Ledger Works:

  1. Transaction Initiation: A user initiates a transaction.
  2. Block Creation: The transaction is grouped with others to form a block.
  3. Verification: The block is verified by network participants using cryptography.
  4. Block Addition: Once verified, the block is added to the chain, linked to the previous block.
  5. Ledger Update: All network participants update their copy of the ledger.

Advantages of Blockchain Ledgers

  • Security: The use of cryptography makes blockchain ledgers highly secure.
  • Transparency: All participants can view all transactions.
  • Efficiency: Transactions are often processed more quickly and at lower costs than traditional methods.
  • Trust: The decentralized nature of the ledger eliminates the need for a central authority to manage the process, increasing trust and reducing potential for corruption.
  • Based on Reference Information: A Blockchain ledger is essentially a chain of blocks, with each block containing information or records. The Blockchain couples each previous block to the following block. Thus, a linked chain of data that is dispersed in blocks makes it difficult to update or revise.