1. Introduction

Welcome to this beginner's guide on how blockchain works. This tutorial aims to provide a clear and easy-to-understand explanation of the fundamental concepts and workings of blockchain technology.

By the end of this tutorial, you will be able to understand:

• The basic concepts of blockchain technology
• How blockchain transactions work
• How blocks are added to the blockchain

There are no prerequisites for this tutorial. However, a basic understanding of computer networking might be beneficial.

2. Step-by-Step Guide

2.1 What is a Blockchain?

A blockchain is a type of database, but the way it stores information is quite different from a typical database. It stores data in blocks that are then chained together. Once new data comes in, it gets entered into a fresh block. Once the block is filled with data, it is chained onto the previous block, forming a chain of blocks known as the blockchain.

2.2 How Does Blockchain Work?

When a block stores new data, it is added to the blockchain. However, four things must happen for that to occur:

1. A transaction must occur.
2. That transaction must be verified.
3. The transaction must be stored in a block.
4. The block must be given a hash.

Once that happens, the block can be added to the blockchain.

3. Code Examples

While a full-fledged blockchain implementation is beyond the scope of this tutorial, let's walk through a simple Python-based blockchain example to illustrate the concepts.

import hashlib
import time

class Block:
    def __init__(self, index, previous_hash, timestamp, data, hash):
        self.index = index
        self.previous_hash = previous_hash
        self.timestamp = timestamp
        self.data = data
        self.hash = hash


def calculate_hash(index, previous_hash, timestamp, data):
    value = str(index) + str(previous_hash) + str(timestamp) + str(data)
    return hashlib.sha256(value.encode('utf-8')).hexdigest()

def create_genesis_block():
    return Block(0, "0", int(time.time()), "Genesis Block", calculate_hash(0, "0", int(time.time()), "Genesis Block"))

def create_new_block(previous_block, data):
    index = previous_block.index + 1
    timestamp = int(time.time())
    hash = calculate_hash(index, previous_block.previous_hash, timestamp, data)
    return Block(index, previous_block.previous_hash, timestamp, data, hash)

• This code first imports the hashlib and time libraries. hashlib is used for creating hashes and time for timestamps.
• Then it defines a Block class, which represents a block in the blockchain. Each block has an index, previous_hash, timestamp, data, and hash.
• The calculate_hash function calculates the hash of a block.
• The create_genesis_block function creates the first block in the blockchain, also known as the Genesis Block.
• The create_new_block function creates a new block in the blockchain.

4. Summary

In this tutorial, you have learned about the basic concepts of blockchain technology, how transactions occur, and how new blocks get added to the chain. We also walked through a basic Python code example to illustrate these concepts.

To delve more into the details, you can learn about:

• Different types of blockchain (Public, Private, Consortium)
• Consensus mechanisms (Proof of Work, Proof of Stake)
• Cryptography in blockchain
• Smart contracts

5. Practice Exercises

1. Write a Python function to print out all blocks in the blockchain.
2. Modify the create_new_block function to include the hash of the new block, not the previous one.
3. Simulate a blockchain network where multiple blocks are added and validated.

Remember, the best way to understand how blockchain works is to get your hands dirty and experiment with coding your own blockchain. Good luck!