A blockchain is a digital record (ledger) that is shared across many computers and is extremely difficult to change once written. Cryptocurrency, like Bitcoin, is digital money that uses blockchain to track ownership without needing a bank.
How does it work?
Transactions are grouped into 'blocks' that are linked together in a chain using cryptography. Because copies of the chain exist on thousands of computers, no single person can secretly alter the records — the network must agree on every change.
Why does it matter?
Blockchain allows people to exchange value and information directly, without a middleman like a bank. It creates trust through technology, enabling secure payments, digital ownership, and transparent record-keeping.
Real-world examples
Bitcoin and Ethereum cryptocurrencies
NFTs for digital art ownership
Supply chain tracking of products
Smart contracts that run automatically
Benefits
Records are transparent and hard to tamper with
Works without a central authority
Enables fast cross-border payments
Creates verifiable digital ownership
Challenges & risks
Cryptocurrency prices are very volatile
Some blockchains use lots of energy
Scams and lost passwords can mean lost money
Key Takeaway
Blockchain replaces trust in a single company with trust in a shared network, but it is still new technology with real risks to understand.
Did You Know?
Because each block is linked to the one before it, changing a single past record would break the links in every block that follows.
Knowledge Check
Why is it hard to change a record once it's on a blockchain?