Blockchain technology is an immutable digital ledger. At its heart the technology is an accounting practice.

We can view double-entry bookkeeping as a precursor to the blockchain because it generates two interdependent and individually validated mathematical outcomes.

The debit “block” on the left  tests the validity of the credit “block” in the right hand column.

Double-entry bookkeeping is a cyclical, self-referential system. Each block only points back to the other in a closed loop, and the blocks validate each other.

When the book is opened, each page provides mathematical validation for the facing page in a closed loop.

But what if that closed loop were opened? What if the validation of one column pointed not back to the other, but onward to another ledger?

A working understanding of the concept of double-entry bookkeeping leads to the image of shelf of interconnected ledgers, each mathematically validating the accounts of both the preceding and following ledgers. Essentially: a blockchain.

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