Blockchain and Bitcoin: What's the Difference?

Blockchain and Bitcoin: What's the Difference?
TabTrader Team
TabTrader Team
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Blockchain is a key new technology allowing data to be stored securely in a distributed or decentralized manner. Bitcoin is one of earliest and best-known implementations of a blockchain.

What is Blockchain and What Does it Consist of?

In simple terms, a blockchain is a database. It can be shared by any number of nodes in a network, which perform various functions depending on the parameters of the specific blockchain itself.

The goal of a blockchain is the secure storage and transmission of data, and nodes often act as participants in the “movement” of data through a blockchain in addition to just keeping a record of its data.


Blockchain data is structured as blocks — packets of information such as transactions — which nodes often approve via consensus before they are deemed valid. Each block relates to the one before and after it, forming a chain of blocks, hence the term ‘blockchain’.


A blockchain node can mean various things, and its role depends on the design of the blockchain involved. A node can simply be a network participant with a copy of the blockchain data — just like in traditional computer networks.

With cryptocurrencies such as Bitcoin, nodes’ roles are more active, as there is a need to reach strict consensus on the data being created within a more-or-less constant timeframe without any authority intervening.


Blockchains with specific use cases can involve network participants who do more than passive nodes. In the case of cryptocurrency blockchains, miners validate blocks and earn a reward in the form of new units of that cryptocurrency which is added to the supply. 

Miners are an essential part of the Bitcoin blockchain, as without them, the network would not be able to guarantee security of funds or validate blocks of transactions at all. 

Bitcoins: Brief Description

Bitcoin (BTC) is perhaps the most famous implementation of Blockchain technology to date. It is the largest and oldest instance of a functioning decentralized blockchain, and is self-maintaining — no one party can or needs to adjust its parameters for it to continue working.

What Blockchain Does Bitcoin Use?

Bitcoin’s blockchain is public — anyone can use it and no entity, whether active on the network or not, can decide who can and cannot transact.

Nodes keep a record of all transactions ever made, while miners or ‘mining nodes’ validate blocks to create that ledger of transactions. 

Miners are in constant competition with each other for a set reward per block, and automated adjustments to mining parameters keep the Bitcoin network stable regardless of changes in the number or computing power of miners. This is a key aspect of Bitcoin’s mining algorithm, known as Proof-of-Work (PoW).

At its heart, however, Bitcoin’s blockchain is still a highly decentralized database of transactions. ‘Sending’ bitcoins ‘around’ the network is thus something of a misnomer — nothing is ‘moving’ at all; Bitcoin’s ledger of transactions is simply being updated.

Blockchain Vs. Bitcoins: Major Differences

Blockchain Bitcoin
Blockchain is a database or ledger for recording information such as transactions. Bitcoin is the first use of a fully decentralized, permissionless blockchain to provide secure, immutable transactions.
Blockchains can be public or private, permissioned or permissionless. Bitcoin is completely open and no one can decide who else uses it or how often.
Blockchains come in many forms and can be engineered to have specific use purposes. Bitcoin’s blockchain requires the consensus of network participants to change. 
The industry attached to this new technology is called ‘Blockchain’ while a specific implementation is called ‘blockchain’ (written in lowercase).  A unit of currency is written as ‘bitcoin’ (in lowercase) while ‘Bitcoin’ refers to the network itself.

Possible Applications

Blockchains vary widely depending on their use case. For example, there are open or ‘publicblockchains (such as Bitcoin’s blockchain) and closed or private ones. In the latter, the network owner decides how the blockchain functions and what each participant can or cannot do.

Blockchains are often given varying degrees of decentralization with large numbers of nodes and participants distributed over large physical distances but without a central point of control. 

Private blockchains, which tend to have corporate owners who by definition require more centralized control of data, often come with the term ‘distributed ledger’ attached to them which emphasizes the blockchain’s role as a more transparent version of a traditional database.

Examples of Use in Different Spheres

Blockchain technology has already found its way into various public and private sectors of the global economy. 

Thanks to its malleability, Blockchain can be engineered to suit specific use cases such as logistics. Using a blockchain allows members of a supply chain to view the passage of goods — and often their production as well — more transparently.

Blockchain can also reduce costs and the need for middlemen in a given industry by automating processes which would otherwise require manual consensus from multiple parties. 

However, due to being a nascent technology, a certain amount of hype has accompanied the emergence of Blockchain. This has sometimes led to its implementation in areas which are neither suited to nor even require data to be held on a transparent distributed ledger.

How can Blockchain Change the World Economy?

Blockchain’s benefits lie primarily in increasing automation and aiding efficiency, thus reducing costs and increasing security of entire industries.

Proponents point to blockchains’ ability to provide transparency in supply chains, production, distribution and of course payment of goods and services among their advantages over traditional technologies.

Blockchain tech remains a nascent phenomenon, however, and reliable mainstream use cases are still emerging.

Blockchain Vs. Bitcoin FAQ

How is Blockchain different from Bitcoin?

Blockchain is the technology which underlies the Bitcoin network. Bitcoin is one example of the implementation of a blockchain.

What does Bitcoin blockchain do?

Bitcoin’s blockchain allows transactions to be made and verified on the Bitcoin network. It allows anyone to use and mine BTC, and run a node to verify every transaction ever made.

How do I access Bitcoin blockchain?

Anyone can use Bitcoin by creating a wallet and buying BTC. Anyone can also run a node on the Bitcoin blockchain to contribute to network security, or run a mining node to earn block rewards.

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