What is blockchain finance?

A blockchain is a data structure made up of blocks containing transaction information that are sequentially linked from back to front. It can be stored as a flat file(a file containing unrelated records) or in a simple database. The bitcoin core client uses Google's LevelDB database to store blockchain metadata. Blocks are sequentially linked in this chain from back to front, with each block pointing to the previous block. Blockchains are often thought of as a vertical stack, with the first block being the first block at the bottom of the stack, and each block subsequently placed on top of the others. After visualizing the concept of stacks, we can use terms such as "height" to indicate the distance between blocks and the first block; And "top" or "top" to indicate the newly added block.

A SHA256 cryptographic hash is performed on each block header to generate a hash value. From this hash value, the corresponding block in the blockchain can be identified. Also, each block can refer to the previous block (parent block) through its block header's "parent block hash" field. That is, each block header contains its parent block hash value. This sequence of hash values linking each block to its parent creates a chain that goes all the way back to the first block (genesis block). Although each block has only one parent block, it can temporarily have multiple child blocks. Each child block has the same block as its parent block and has the same (parent block) hash value in the parent block Hash field. The occurrence of multiple sub-blocks in one block is known as a "blockchain fork". Blockchain forking is only a temporary state, and only happens when multiple different blocks are discovered by different miners at about the same time. Eventually, only one subblock will become part of the blockchain, while solving the problem of "blockchain forking." Although a block may have more than one child block, each block has only one parent block, because a block has only one "parent block hash" field that can point to its unique parent block.

Since the block header contains a "parent block hash" field, the hash value of the current block is affected by this field. If the identity of the parent block changes, the identity of the child block changes as well. When any changes are made to the parent block, the parent block's hash value also changes. A change in the parent block hash will force a change in the parent block hash field of the child block, which in turn will cause the child block hash to change. A change in the child block's hash will force the child block's "parent block hash" field to change, which in turn changes the child block's hash, and so on. Once a block is many generations old, this waterfall effect guarantees that the block will not be changed unless all subsequent blocks of the block are forced to be recalculated. Precisely because such recalculations are computationally expensive, the existence of a long blockchain makes the history of the blockchain immutable, a key feature of Bitcoin's security.

You can think of a blockchain as a geological layer in a geological structure or a glacier core sample. The surface layer may change seasonally and be blown away by the wind even before it is deposited. But the deeper you go, the more stable the geological layer becomes. Go a few hundred feet down, and you're looking at rock formations that have been preserved for millions of years, but have remained historically intact. In a blockchain, the most recent blocks may be modified due to recalculation caused by a fork in the blockchain. The latest six blocks are like a few inches of topsoil. Beyond those six blocks, however, the deeper a block is in the blockchain, the less likely it is to be changed. After 100 blocks, the blockchain is stable enough that Coinbase transactions (those containing newly mined Bitcoins) can be paid for. A few thousand blocks (a month) later the blockchain will become certain history and will never change.