*2.1.2 How does it work?*

The name Blockchain is not by chance: A "chain" of separate "blocks" of data is often used to characterize the digital ledger. A new "block" is formed and attached to the "chain" as new data are uploaded to the network. This requires that all nodes update their Blockchain ledgers in order to be identical.

#### **Figure 1.** *An example of how Blockchain is used to verify and record bitcoin transactions [7].*

The reason Blockchain is considered extremely secure is because of the way these new blocks with informations are formed. Before a new block can be added to the ledger, most nodes must verify and certify the legitimacy of the new data. An independent database or spreadsheet (the methods used before Blockchain), on the other hand, allows a person to make changes without supervision [7].

**Figure 1** [7] shows an example of how Blockchain is used to verify and record Bitcoin transactions.
