The innovation of blockchain technology is that by design, blockchains are resistant to retroactive modification and can store data securely without a centralised authority.
The process starts with the cryptographic hash function. Each block has a hash function for its own data and a hash function for the last block’s data.
By encoding the previous block’s data into each new block, the hashes create a chain that is it grows becomes ever harder to corrupt.; to tamper with, or modify any particular block’s data, you would also have to modify all subsequent blocks to keep the chain valid.
If I change the data on a specific block, it’s corresponding hash will change – remember from our dog example above – and be different to all following block’s recorded hashes and thus the chain will become invalid.
However, due to the speed of today’s computers, this hash function isn’t enough to secure blockchain’s from being tampered with.
Computers can calculate hundreds of thousands of hash functions per second and could effectively calculate new hashes for all blocks in a chain to make it valid again. Thus, Sastoshi’s need to create a consensus mechanism – borrowing from previous attempts at digital cash – that was immune to brute force attack.
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