A blockchain is a public ledger of all Bitcoin transactions. When new transactions are made “blocks” of transactions are added to the sequential blockchain.

How a Blockchain Works

A blockchain is one of the foundational concepts in the bitcoin system. In order for someone to make a transaction using bitcoin, the transaction must be submitted to the community. At this point, community members attempt to crack a very difficult computational puzzle that allows the transaction to be added to the public ledger.

The first member of the network to properly solve the puzzle gets to append that block of transactions on to the end of the current block chain. At that point, all of the transactions in the new block become a permanent part of the public record. When a new block is added to the chain, new coins are created and awarded to whoever successfully added the block to the chain. The process of adding blocks to the chain is known as cryptocurrency mining.