The foundation of most cryptocurrencies, the blockchain is a digital ledger that is read from and written to via any qualified computer connected to it. Think distributed, secure, anonymous data storage where each new piece of information (a block) is added to the end of the ledger (a new link in the chain) – hence, “blockchain”. This allows a permanent record of every transaction that has ever occurred which is replicated on every copy of the blockchain that is authorized to write or read to it. This means that there is no way to falsify records (how could someone change a record on millions of copies at once?) and that once committed to the blockchain the data and record is essentially immutable. Many enterprises are looking at ways to leverage blockchains given these unique qualities
The Blockchain is perfect for cryptocurrencies because any owner’s claim to any piece of information on the Blockchain can be verified by anyone. In this way, the identity of an owner of a piece of cryptocurrency and the amount that owner has transferred to their possession is trackable yet secure and anonymous.