A blockchain is a kind of forgery-proof, virtual ledger where each digital transaction is kept and cannot be altered. This ledger is not stored at a central site, but distributed and fed by servers all over the globe. New transactions are added in a block-wise manner. The transactions must be confirmed by all parties involved before they can be concluded and added to the chain. If a transaction is not confirmed because one of the parties feels betrayed, it will be cancelled.

From a technical point of view, a blockchain is a database. Each new record (block) that is added will get a checksum. This hash value will be stored in the block that is generated next, thus forming a chain. This makes all the transactions traceable. Each participant has basically the same access rights and can see which transactions have been made, but they cannot see who made the transaction.

The most popular example of a blockchain is the digital currency Bitcoin . This method, however, could also be used for other transaction for which intermediaries or guarantors such as notaries are still required today.