Blockchain technology is an advanced database mechanism that allows transparent information sharing within a business network. A blockchain database stores data in blocks that are linked together in a chain. Blockchain derives its name from the digital databases or ledgers where information is stored as "blocks'' that are coupled together forming "chains".

Blockchain technology serves as the foundation for the digital cryptocurrency, bitcoin. It is a distributed network of servers where information is mirrored on all participating computers and verified through laborious calculations.

To ensure security, blockchains make considerable use of cryptography. Blockchain is said to be more secure and resilient against hacking and other manipulations than other centralised servers. A distributed ledger that is open to anyone. Some data is recorded in a blockchain so it is difficult to change it. Each Block has a hash that stores unique information.

Hashes are useful when you want to change the information inside the block or know what changes have been made. Hash of the previous block creates a chain of blocks and this technique makes it secure. First block is called the genesis block. Changing a single block will hamper all the others and tampering with one hash creates a problem with the others.

One can tamper one block and also change the others or create a new block. Therefore, to avoid this and mitigate it, a blockchain has a ' proof of work ' method which slows down the creation of new blocks. Another method by which block chains secure themselves is by distributing. instead of centralisation, a node is created, therefore when a new block is created it is to be verified by all the members of the node and is known as the P2P network.

Smart Contracts:
Simple programs stored on the block chain can be used to automatically exchange coins, with respect to certain conditions. Distributed ledger to store contracts. Tiny computer programme stored in a block chain. Enforceable by code. some common smart contract platforms like Ethereum, Solana, Polkadot, Hyperledger fabric, etc.

The Legal Sphere:
The legal and judicial frameworks have both benefited from the application of Blockchain Technology. In India, there is currently no legislation that regulates and keeps a check on blockchain technology and its numerous applications. However, the existing sector-specific regulators may have the authority to govern the use of blockchain-related technologies, depending on the many sectoral applications.

The Hon'ble Supreme Court of India in Internet and Mobile Association of India v. Reserve Bank of India has brought the attention of the legal sector to the distributed ledger technology that provided the fundamental foundation of Cryptocurrencies (bitcoin, dogecoin). The Court held that the RBI did have the necessary powers to regulate virtual currencies in its role to secure India's economy.

Banks and other financial institutions which are regulated by RBI are no longer prohibited from provisioning bank related services in relation to dealing of cryptocurrencies. This was derived as the RBI could not clearly tell the damages that the economy would face if cryptocurrency was not banned and therefore the Supreme Court declared restrictions to be unenforceable. In India, there is currently no legislation that regulates and keeps a check on blockchain technology and its numerous applications.

However, the existing sector-specific regulators may have the authority to govern the use of blockchain-related technologies, depending on the many sectoral applications. Meanwhile, The Department of Economic Affairs, Ministry of Finance has drafted the 'Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019' ("Draft Bill").

The Draft Bill intends to outlaw a wide variety of cryptocurrency-related activities in India. The bill highlights difficulties such as holding, selling, disposing of, or any type of cryptocurrency exchange. The specified prohibition only applies to dealing in cryptocurrencies; it does not apply to the usage of distributed ledger technology or the use of cryptocurrencies for research purposes.

Under the Draft Bill, Mining, holding, selling, issuing, transferring, or using cryptocurrencies is punishable with a fine or imprisonment of up to 10 years, or both. As per the draft bill, the central government, in cooperation with the RBI, considers approving the digital rupee as legal money.

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• Blockchain Technology and Smart Contracts