Blockchain technology is not simply a data storage solution but a fundamental transformation in the way people establish trust and realize values in the digital space. According to experts at Tan Phat Digital, in essence, Blockchain is a distributed, transparent and immutable digital ledger, storing data through encrypted blocks and closely linked together in chronological order. The operation of this system is based on a peer-to-peer (P2P) network, where power is not concentrated in any central server but is distributed to every node participating in the network, requiring a common consensus mechanism to authenticate and record new information.
Formation and evolution of Blockchain theory
The birth of Blockchain is the result of a decades-long process of cryptographic research, solving the core problem of trust in the digital environment. In 1991, two scientists, Stuart Haber and W. Scott Stornetta, laid the first bricks when they published their work on a chain of cryptographically secured blocks.1 What motivated them was concern about the ability to easily alter digital records without leaving a trace. Their solution was to create a time-stamp mechanism so that data could not be tampered with or altered after it had been recorded.
In 1992, the system was significantly upgraded by integrating Merkle Trees, a data structure that allows multiple documents to be grouped into a single block, increasing the performance of data integrity checks without downloading the entire ledger. The next phase saw the emergence of decentralized cryptocurrency concepts such as Wei Dai's "b-money" and Nick Szabo's "Bit Gold" in 1998.3 Although these projects were not fully implemented, they laid the foundations for the theory of digital currency based on cryptographic puzzles.
The real turning point came in late 2008, amid the global financial crisis, when an individual An anonymous person or group named Satoshi Nakamoto published a whitepaper describing Bitcoin.4 Nakamoto combined the research of Haber and Stornetta with the Proof of Work mechanism to solve the "double-spending" problem without the need for banks or any intermediaries.5 On January 3, 2009, the Bitcoin network officially went live with the first block mined, marking the beginning of the era Blockchain 1.0 focused on money.
Evolution continued to move to Blockchain 2.0 in 2014, when this technology began to be separated from the pure concept of currency to apply to broader fields.3 In 2015, Vitalik Buterin launched Ethereum, introducing the ability to execute smart contracts (Smart Contracts), allowing programming of decentralized applications (dApps) on the chain platform block.3 By 2020, the decentralized finance (DeFi) ecosystem exploded, affirming the role of Blockchain in restructuring traditional financial services.5
Currently, we are entering the Blockchain 4.0 era, where technology focuses on deep integration with Artificial Intelligence (AI), Internet of Things (IoT) and Big Data to thoroughly solve the "impossible trinity". (Scalability, Security, Decentralization).
See more: What is Centralized? Decentralized vs Centralized
Technical infrastructure structure of a data block
A block in Blockchain is a basic unit of storage, acting as a page in the digital ledger. The structure of each block is designed to ensure high connectivity and self-verification. Technically, a block includes two main components: Block Header and Block Body.
Block Header and identification data fields
The block header is the part that contains metadata that plays a decisive role in security and chain linkage. In the Bitcoin protocol, the block header has a fixed size of 80 bytes and consists of six essential components 10:
Version (Version - 4 bytes): An integer used to track protocol and software updates in the network. Nowadays, it is often used to signal miners' readiness for software upgrades.
Previous Block Hash - 32 bytes: A value containing the hash of the immediately preceding block header. This is the key element that creates the "chain" structure, because any change to an old block will change its hash code, thereby causing the hash code stored in the next block to become incorrect and break the validity of all blocks behind.
Merkle Root (Merkle Root - 32 bytes): A value that represents all transactions contained in the block through a binary tree structure. It allows nodes to check the integrity of a specific transaction without reading the entire block.
Timestamp (Timestamp - 4 bytes): Records when the block was created (in Unix epoch format). Nodes only accept the block if the timestamp is within the network's time limit.
Difficulty Target (Bits - 4 bytes): A value that defines the threshold (target) below which the block's hash must be considered valid during mining.10
Nonce (4 bytes): A variable that miners continuously change in search of a suitable hash rate that satisfies the difficulty target.
Block Body and transaction structure
The block body contains the actual list of transactions that have been validated by the network. The number of transactions in a block depends on the protocol's block size limit or block weight limit. In Bitcoin, the first transaction is always a Coinbase transaction - this is a special transaction that generates block rewards for miners.11 The remaining transactions are taken from the waiting pool (mempool), each transaction includes detailed information about the sender address, recipient, asset amount and authentic digital signature.
Encryption and digital signature mechanism: Pillars of immutability
Blockchain security is based on two core cryptographic techniques Core: Cryptographic Hash Functions and Digital Signatures. These technologies ensure that data cannot be tampered with and asset ownership is always absolutely authenticated.
SHA-256 hash function and data consistency
SHA-256 algorithm (Secure Hash Algorithm 256-bit) is the most popular standard in leading Blockchain networks such as Bitcoin. At Tan Phat Digital, we always emphasize that the most important characteristics of SHA-256 are "one-way" and collision resistance. Every input data that passes through SHA-256 produces a hash string with a fixed length of 256 bits (equivalent to 64 hex characters).
Another extremely important property is the "avalanche effect". By simply changing a single bit in the original data, the output hash code will change completely and will not have any relation to the old hash code. This makes integrity checking extremely simple: nodes in the network simply run the data through the hash function and compare the result with the published hash code.
ECDSA Digital Signature Algorithm
While the hash function protects data, Elliptic curve digital signature (ECDSA) protects access and the authenticity of transactions. This process is based on a pair of public keys (Public Key) and private keys (Private Key).
The private key is an extremely large random string that the user must keep absolutely secret. The public key is calculated from the private key through irreversible elliptic curve operations.15 When making a transaction, the sender uses the private key to create a digital signature for the message. Anyone on the network can use the sender's public key to verify the signature without ever knowing the original private key.
Consensus Mechanisms: The Engine of Decentralized Trust
In a distributed system with no central server, a consensus mechanism is a protocol that allows network nodes to reach agreement on a single state of the digital ledger.17 This is the solution to the generals problem. Byzantine, ensuring the network still operates correctly even if some nodes fail or have malicious intentions.
Details of popular consensus mechanisms:
Proof of Work (PoW):
Core resources:Computer power and electrical power.
Advantages Points: Extremely high security, best decentralization, tested over 15 years with Bitcoin.
- grid.
Advantages: 99.95% more energy efficient than PoW, fast speed, no need for huge hardware.19
Disadvantages: Risk of asset centralization (the rich get richer), susceptibility to the control of "whales".
Delegated Proof of Stake (DPoS - Delegated Proof of Stake):
Core resource: Community voting.
Advantages: Outstanding processing speed (thousands of TPS), extremely low transaction costs.
Disadvantages: Lower decentralization due to limited number of validators, easily manipulated by the group small.
Proof of Authority (PoA):
Core resource: The actual identity and reputation of the validator.
Advantages: Extremely high performance, suitable for enterprise or consortium blockchains.
Disadvantages: Completely centralized, dependent on the trustworthiness of assigned nodes.
Proof of History (PoH):
Core resource: Cryptographic chronology.
Advantages: Extremely fast speed (up to 65,000 TPS like Solana), reduced authentication latency receive.
Disadvantages: Technically complex, requires nodes capable of accurate time processing.
Smart Contracts and Ethereum Virtual Machine (EVM)
If Blockchain 1.0 was a ledger that only recorded numbers, Blockchain 2.0 turns it into a world computer capable of executing code. Smart Contracts are self-running programs located on the blockchain, automatically executing agreements when predetermined conditions are met without the need for third party intervention.
EVM Operating Principle
The Ethereum Virtual Machine (EVM) is the control center of the Ethereum network, operating as a distributed state machine running simultaneously on thousands of nodes around the world.7 State of the network (Ethereum) State) includes account balances, contract source code and stored data, updated through the state transition function: $Y(S, T) = S'$, where $S$ is the old state, $T$ is the new transaction and $S'$ is the result state.
EVM is a stack-based system with a maximum depth of 1024 entries, each entry is a 256-bit word to optimize for 256-bit cryptography.30 When a developer writes code in Solidity, that code is compiled into bytecode that the EVM can execute deterministically on any device.
Gas Mechanism and Network Economics
Gas is a measure of the computational effort required to perform operations on the EVM.28 Every action, from a simple addition to creating a New contracts all have a set gas fee to prevent infinite loops or network resource abuse (DoS) attacks.
Users must pay a gas fee in Ether for each transaction. If the gas supply is insufficient, the EVM will stop execution and reverse all state changes, but the gas fee used will not be refunded to compensate the validators' computational effort.
The Impossible Trinity and Scaling Strategy
The biggest challenge of Blockchain technology today is the "Scalability Trilemma". This concept asserts that a Blockchain network can only achieve a maximum of two of three properties: Decentralization, Security and Scalability.33
Trade-offs in system design
Decentralization vs. Scalability: When decentralization is high, synchronizing data between thousands of computers will be time-consuming, causing transaction speed (TPS) to be limited.
Security vs. Scalability:Attempting to speed up processing by reducing checks can create vulnerabilities for attackers.36
Modern Scaling Solutions
Layer 2 and Rollups: Process transactions off-chain, then compress the data and send proof back to Layer 1. Optimistic Rollups assumes the transaction is valid and allows for a trial period, while ZK-Rollups uses cryptographic proof to confirm i.e. then.
Sharding: Subdividing the network into parallel shards (shards), each shard processing a separate portion of data, allowing simultaneous processing of multiple transaction streams.
PeerDAS: A technique that allows network nodes to check the presence of data through random sampling, increasing data processing capacity without requiring expensive hardware upgrades money.
Types of Blockchain networks
Depending on the governance model, Blockchain is classified into four main models:
Public Blockchain (Public Blockchain): Completely open, anyone can participate in verifying and accessing data (For example: Bitcoin, Ethereum). Highest decentralization and security.
Private Blockchain: Controlled by a single organization. Extremely high performance and good internal security, suitable for businesses that need absolute control over data.
Consortium Blockchain: Control is shared among a group of member organizations. Combines efficiency and moderate dispersion of power.
Hybrid Blockchain (Hybrid Blockchain): Combines the advantages of public and private chains, allowing organizations to secure internal data but still be able to publish necessary evidence to the public network.
See more: What is Blockchain? How blockchain works
Blockchain in Logistics and Supply Chain
The logistics field is where Blockchain proves its strongest practical value. As observed by Tan Phat Digital, this technology helps solve the lack of transparency and paperwork inflation in global trade.
Transportation process digitalization solution
Blockchain helps create a "single source of truth" for every stakeholder 44:
Case Study TradeLens: The platform developed by Maersk and IBM has tracked billions of events transportation, helping to reduce costs by simplifying documentation procedures, although it announced to stop operations in 2023 due to challenges in the level of industry-wide cooperation.
Traceability: Walmart uses Blockchain to help reduce food traceability time from 7 days to 2.2 seconds.
Security and vulnerabilities in Smart Contracts
Even though the infrastructure Blockchain is very secure, but smart contracts are often targets of attacks. The most serious vulnerability is the Reentrancy Attack, which occurs when a contract calls an external function before updating its internal state, allowing an attacker to repeatedly withdraw funds in a single transaction.27
As a precaution, developers at Tan Phat Digital recommend using the CEI model (Checks-Effects-Interactions):
Checks: Check every input condition (balance, authority).
Effects: Update internal state (except balance) immediately.
Interactions: Execute deposit orders or call the final external contract together.
Vision 2026: Convergence of Blockchain and AI
Blockchain is moving towards phase 4.0, where it no longer operates independently but closely combines with AI and new legal frameworks.
ZK-ML and Cryptographic Real Assets (RWA)
ZK-ML (Zero-Knowledge Machine Learning): Enables AI to prove calculation results without revealing sensitive data. Important applications in healthcare (training AI on secure patient records) and validating the legitimacy of AI models.
RWA (Real World Assets): Tokenize real assets such as real estate, gold, art into tokens to increase liquidity and accessibility for retail investors. This market is forecast to reach a scale of 16 trillion USD by 2030.
New legal framework 2026 in Vietnam
The year 2026 will be an important milestone for the Blockchain community in Vietnam. The Digital Technology Industry Law has been passed and will take effect from January 1, 2026. The law provides for the first time clear legal definitions for "virtual assets" and "crypto assets", opening up space for investment and trading activities in a controlled environment. Vietnam is also aiming to pilot centralized trading floors and apply Blockchain to the national justice and traceability system.
Top 20 most typical and potential Blockchain projects in 2026
Based on market data and the latest technology trends, Tan Phat Digital compiles a list of the 20 most influential Blockchain projects in the period 2026:
Layer 1 Project Group (Blue-chip Platform)
Bitcoin (BTC): "Digital gold" and the standard asset of the entire market. In 2026, Bitcoin is expected to explode thanks to the cash flow from ETFs and the rapidly growing Layer 2 ecosystem.
Ethereum (ETH): The strongest decentralized ecosystem, where the majority of DeFi, NFT and RWA projects are concentrated. The shift to PoS and extensive upgrades help ETH maintain its number 1 position for real-world applications.
Solana (SOL): High-performance blockchain leads in speed and low cost, especially strong in the payment, consumer app and memecoin segments.
BNB Chain (BNB): The ecosystem associated with the Binance exchange, has great advantages in terms of performance and user accessibility.
Ripple (XRP): Focuses on cross-border payment infrastructure for large financial institutions.
Cardano (ADA): Developed based on scientific research, focusing on sustainability and long-term security.
Sui (SUI): New star with processing architecture parallel, reaching speeds of hundreds of thousands of TPS, optimized for games and dynamic digital assets.
Avalanche (AVAX): Featured with Subnets structure, allowing businesses to create separate blockchains but still connected to the main network.
TON (The Open Network): Deeply integrated into Telegram, possessing the potential to reach billions of users through applications Mini-apps.
Polkadot (DOT): Multichain network that helps projects connect and share security through parachains.
Cosmos (ATOM): "Internet of Blockchains" with IBC protocol allowing seamless communication between independent blockchains.
Layer 2 & Infrastructure Project Team floor
Chainlink (LINK): The world's No. 1 Oracle network, an indispensable data bridge for the trend of digitizing real assets (RWA).
Arbitrum (ARB): The leading Layer 2 solution on Ethereum in terms of transaction volume and compatibility with dApps.
Optimism (OP): Superchain building platform, helping to scale Ethereum flexibly and securely.
Stacks (STX): The most representative Layer 2 solution for Bitcoin, bringing smart contract execution to the world's oldest network.
DeFi Project Team & New Trends (AI, RWA, DePIN)
Bittensor (TAO): The project leads the field of decentralized AI, creating an open market for machine learning models.
Render Network (RENDER): Provides decentralized GPU computing power for AI and 3D graphics tasks.
Ondo Finance (ONDO): A bridge between traditional finance and on-chain, leading in the digitization of assets such as treasury bonds.
Lido Finance (LDO): The project leads the Liquid Staking segment, allowing users to optimize profits from staking.
Uniswap (UNI): The standard decentralized exchange (DEX) and the liquidity heart of the entire ecosystem DeFi.
Frequently Asked Questions (FAQ) about Blockchain technology
Below is a collection of the 10 most common questions that experts at Tan Phat Digital often receive from partners and the community:
How does Blockchain work in the simplest way? Imagine Blockchain as a digital ledger that is replicated for thousands of network participants. When there is a new transaction, it is grouped into a "block", encrypted with a hash function, and linked to the previous block. All changes require the consent of the majority, keeping data transparent and unable to be edited or deleted.
Why is Blockchain "immutable"? Immutability comes from the combination of hash function and chain structure. Each block header contains the hash of the previous block. If someone tries to modify the data in the first block, its hash will change completely (avalanche effect), distorting all subsequent blocks in the chain, causing the network to detect fraud immediately.
How is Proof of Stake (PoS) more energy efficient than Proof of Work (PoW)? PoW requires miners to run powerful computers continuously to solve cryptographic puzzles, consuming as much energy as possible. a small country. Meanwhile, PoS selects validators based on the amount of money they stake. This mechanism helps reduce power consumption by up to 99.95% while still ensuring network safety.
What can Smart Contracts be used for? In addition to cryptocurrencies, Smart Contracts are used to automate legal agreements, manage NFT ownership, enforce automatic insurance clauses or manage supply chains. When the agreement conditions are met, the command code will automatically execute without the need for an intermediary.
What is Reentrancy Vulnerability in Smart Contracts? This is a vulnerability that allows attackers to continuously withdraw money from a contract before it has time to update its balance. The hacker called the recursive withdrawal command multiple times, causing the contract to lose all its assets. The best way to prevent this is to apply the Checks-Effects-Interactions (CEI) design pattern.
Can the "Scalability Trilemma" be solved? Currently, there is no project that completely optimizes all 3 pillars (Decentralization - Security - Scalability). However, solutions like Layer 2 (Rollups) and Sharding are helping networks like Ethereum get very close to solving this problem without having to trade too much.
What is the biggest difference of Blockchain 4.0? Blockchain 4.0 is not only for finance but focuses on industrial scale (Industrial Blockchain). It focuses on the ability to process hundreds of thousands of transactions per second (TPS) and deeply integrates with AI and IoT to create intelligent self-operating systems.
How does Blockchain prevent counterfeit goods in Logistics? Each product is assigned a unique digital identifier on the blockchain right from the place of production. The entire journey from transportation, warehousing to consumers is recorded. Users only need to scan the QR code to check the origin, because this data is immutable and cannot be tampered with by counterfeiters.
What is ZK-ML (Zero-Knowledge Machine Learning)? This is a combination of ZK cryptography and AI. It allows a party to prove that the AI model processed data correctly and produced accurate results without revealing sensitive input data. This is especially important in healthcare and digital identity security.
Will Vietnamese people be allowed to trade crypto assets in 2026? According to the Digital Technology Industry Law (effective from January 1, 2026), crypto assets are defined as a type of digital asset. Although not a legal means of payment, the law paves the way for investment, trading and piloting of centralized exchanges within the Government's legal framework.
Blockchain has gone beyond its origins as a technology supporting currency to become a trust infrastructure for digital society. With the convergence of AI and legal perfection by 2026, Blockchain will increasingly permeate every corner of economic life. Tan Phat Digital believes that mastering the architecture and operation of this technology is the key for businesses and individuals to not be left behind in the global digital revolution.
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