Crypto and derivatives · updated October 21, 2026
What is blockchain and how does it work
A blockchain is a record of transactions kept at the same time on thousands of computers around the world, not on one bank's server. Transactions are grouped into blocks, and each new block is linked to the one before it. To change an old transaction you would have to redo every block after it on most of those computers, which in practice cannot be done.
How it works
Someone sends a transaction (say 0.1 BTC). Computers on the network check that the sender really has the coins and that the signature is valid. Checked transactions go into a new block, which gets a "fingerprint" (hash) calculated partly from the previous block. That is how the chain forms. Who gets to add the next block is decided by mining (Bitcoin) or by staking (Ethereum).
Worked example
On Bitcoin, a new block appears every 10 minutes on average. On Ethereum, every 12 seconds.
The more blocks sit on top of a transaction, the harder it is to reverse. That is why many platforms wait for a few confirmations before your coins show up in your account.
Worth knowing
A public blockchain (Bitcoin, Ethereum) can be read by anyone: you can see every transaction of an address, but not the name of the person behind it.
When blockchain can fool you
Not everything labelled "blockchain" is safe: the record cannot be changed, but the platform, wallet or app you use to reach it can be hacked. Anonymity is only on the surface: once an address is tied to your name (for example through a platform that checked your ID), all its transactions can be traced.
Related terms
Learn it in the Academy
Questions about blockchain
Who controls a blockchain?
On Bitcoin and Ethereum, no single person. The rules live in the software every participant runs, and changing them needs most of them to agree.
Can a transaction be deleted from a blockchain?
No. A confirmed transaction stays in the record. If you sent coins to the wrong address, you only get them back if the person who received them sends them back.
These explanations are for information only. They are not a recommendation to buy or sell.
Back to the glossary