How does blockchain ownership work?
In this blog, we take a look at blockchain ownership, how it works, who owns what, and more. If you are more curious about the specifics of questions like Who owns the rights to a blockchain, Who owns data on the blockchain, How do I prove ownership of Bitcoin, How do you know if you own crypto? You can scroll down right away to find the answer there.
Ownership on a blockchain is made possible by the structure of the system. As each account is fully unique and unhackable it can hold ownership of the coins/tokens on it.
A blockchain can secure many different types of ownership. From digital currency to collectibles or tokens bound to real-world assets. This gives rise to online economies that we could not imagine before. Making it the central part of web3 and the future infrastructure of the internet. So you can take real ownership of your in-game items or digital identity.
Who owns the rights to a blockchain?
Nobody really. Any blockchain is owned by everyone participating in the network. This can be stakers, miners, node operators, and people that just use the network.
Together all these people own a blockchain network. This property makes a blockchain decentralized. So that not just one party can simply cancel a transaction or stop someone from using the network. This simple fact together with the fact that each blockchain account is unique gives real ownership to the user. So if you have an address on any blockchain, only you have access to the funds on that address.
This comes from the property that each address is so unique that it is basically impossible to guess the private key (sort of password for a blockchain account). So the right to own assets on-chain or to even just use a blockchain are all in your hands.
Who owns data on the blockchain?
Depending on the blockchain either everyone, only you, or a selected group of people.
On blockchains like Bitcoin, the data is owned by everyone. Even by people that have not used the network. You can see this data by using a Bitcoin explorer. Here you can see all the transactions from the beginning of the blockchain till now. This makes Bitcoin not only super transparent but very efficient when you want to check the flow of funds. Which can be a great way to help fight corruption.
On other more privacy focussed blockchains. The possibility to see old transactions might be completely removed or only available for the sender of that transaction. This gives much more privacy to those users that do not want anyone to track their spending. Like in an example of oppressed people in a dictatorship etc. Let’s say you would live there you would probably not want the regime to know that you buy very illegal imported honey syrup. Because then the will make it more difficult for you to buy a house or whatever. This is why the privacy of transactions is also very important on a blockchain.
With Bitcoin, this is solved by making use of the lightning network. But some other blockchains also face this on a first layer level. So they won’t have to worry about anyone tracking them.
How do I prove ownership of Bitcoin?
With the private key, you can prove ownership of your BTC. Which also functions as the only way you can send a transaction.
The Private key is a randomly generated string of letters and numbers that works like a password to your Bitcoin account. From this private key, we can generate a Public key which works as a public address for receiving your funds. The private key works as the only way to access a blockchain/Bitcoin account. So giving it to someone else will give them access to your funds as well. Because of that reason, users must always keep their private keys out of the hands of criminals. So no one can steal your funds.
But do always make sure to have a backup of it. Either in the form of the private key written down or in the form of a 12-word phrase. Then store either one of them safe so no one can access them. Just in case you lose your crypto wallet.
How do you know if you own crypto?
You will know by either checking it within your own crypto wallet or by going to a blockchain explorer and looking up your public address.
Doing one of those 2 will show you your balance inside your wallet. Or show you the address’s info inside the block explorer. Including the current balance. Because your crypto can only move around with a signature from the private key, only those with access to it do really own that crypto. Like the famous phrase in the crypto industry goes “not your keys not your coins”.
This basically means that if you own the (Private) key(s), you own the coins/tokens. So never lose it or give it away! Although crypto might not be a physical thing its ownership through keys makes it have a similar property of physical items. As it can not be copied. This way you can for the first time truly own digital items and make the internet fairer. And not just owned by the big tech companies.
We hope this blog thought you more about how blockchain ownership works. If you have any other crypto-related questions that you would like us to answers. Feel free to let us know on our social channels. If you feel ready to start using crypto yourself? You can take a look at our wallet finder function. To find the right wallet for you and take full ownership of your crypto!