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Block Crypto - Indodax Academy

Block is a collection of transaction data that forms the basic elements of a crypto asset such as Bitcoin. When a Bitcoin transaction occurs, information related to the transaction is collected and when the data reaches a predetermined size, it is combined with other Bitcoin transactions and then compiled into a single block. The blocks will be processed by the miners and verified for accuracy. When a transaction goes to the block and is verified, that’s when the Bitcoin transaction gets 1 confirmation.

Blocks can also be referred to as data structures in blockchain databases, where transaction data in the cryptocurrency blockchain is permanently recorded. A block records some or all of the most recent transactions that have not been validated by the network. After the data is validated, the block is closed. Then, a new block is created for the new transaction to be entered and validated.

Thus, a block is a permanent storage of records which, once written, cannot be changed or deleted.

The blockchain network is witnessing a lot of transaction activity. When used in cryptocurrencies, maintaining a record of these transactions helps the system keep track of how much was used or not and which parties were involved. Transactions made during a certain period are recorded into files called blocks, which are the basis of the blockchain network.

A block stores information. There’s a lot of information included in one block, but it doesn’t take up much storage space. Blocks generally include these elements, but may differ among the different types:

1. Magic Number: A number containing a specific value that identifies the block as being part of a particular cryptocurrency network.

2. Blocksize: Sets a size limit on the block so that only a certain amount of information can be written in it.

3. Block Header: Contains information about the block.

4. Transaction counter: A number that shows how many transactions are stored in the block.

5. Transactions: List all transactions in a block.

The transaction element is the largest because it contains the most information. It is followed in storage size by a block header, which includes these sub-elements:

1. Version: The version of the cryptocurrency used.

2. Previous block hash: Contains the hash (encrypted number) of the previous block header.

3. Merkle root hash: Hash the transaction in the Merkle tree of the current block.

4. Times: Timestamp for placing blocks on the blockchain.

5. Bits: The difficulty of the target hash, indicating the difficulty of breaking the nonce.

6. Nonce: An encrypted number that miners have to crack to verify the block and close it.

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