Finally, the most critical attribute of a blockchain is that it is updateable only via consensus.
In this scenario, no central authority is in control of updating the ledger.
How Updateable via consensus Works
Instead, any update made to the blockchain is validated against strict criteria defined by the blockchain protocol and added to the blockchain only after a consensus has been reached among all participating peers/nodes on the network.
To achieve consensus, there are various consensus facilitation algorithms which ensure that all parties are in agreement about the final state of the data on the blockchain network and resolutely agree upon it to be true.
Consensus algorithms are discussed later and throughout the book as appropriate.
Blockchain can be thought of as a layer of a distributed peer-to-peer network running on top of the internet, as can be seen in the following diagram.
It is analogous to SMTP, HTTP, or FTP running on top of TCP/IP.
The network view of a blockchain At the bottom layer in the preceding diagram, there is the internet, which provides a basic communication layer for any network.
Why This Matters for Blockchain Technology
In this case, a peer-to-peer network runs on top of the internet, which hosts another layer of blockchain.
That layer contains transactions, blocks, consensus mechanisms, state machines, and blockchain smart contracts.
All of these components are shown as a single logical entity in a box, representing blockchain above the peer-to-peer network.
Finally, at the top, there are users or nodes that connect to the blockchain and perform various operations such as consensus, transaction verification, and processing.
Key Points to Remember
- Updateable via consensus Finally, the most critical attribute of a blockchain is that it is updateable only via consensus.
- In this scenario, no central authority is in control of updating the ledger.
- Instead, any update made to the blockchain is validated against strict criteria defined by the blockchain protocol and added to the blockchain only after a consensus has been reached among all participating peers/nodes on the network.
- To achieve consensus, there are various consensus facilitation algorithms which ensure that all parties are in agreement about the final state of the data on the blockchain network and resolutely agree upon it to be true.
Going Deeper: Advanced Concepts
From a business standpoint, a blockchain can be defined as a platform where peers can exchange value / electronic cash using transactions without the need for a centrally-trusted arbitrator.
For example, for cash transfers, banks act as a trusted third party.
In financial trading, a central clearing house acts as an arbitrator between two trading parties.
This concept is compelling, and once you absorb it, you will realize the enormous potential of blockchain technology.
Conclusion
Updateable via consensus represents one of the many innovative layers that make blockchain technology so powerful and transformative. As distributed systems continue to evolve, a solid understanding of these core concepts becomes increasingly valuable — not just for developers, but for anyone building, investing in, or working alongside blockchain-powered systems.
Whether you are just starting your blockchain journey or deepening existing expertise, mastering these fundamentals gives you the tools to think clearly about decentralized systems and make smarter decisions in this rapidly evolving space.