#OnChainInsights What does on-chain mean in the world of cryptocurrencies?

In the world of cryptocurrencies, on-chain refers to all transactions, records and processes that occur directly on the blockchain, that is, in a public, verifiable and immutable manner. 

On-chain transactions are recorded in a distributed ledger, such as the blockchain, where they are permanently stored and visible to anyone. This ensures transparency and security in the crypto ecosystem.

Understand the main differences between on-chain and off-chain transactions

The main difference between on-chain and off-chain is where the transactions are processed:

on-chain: recorded directly on the blockchain, public, transparent and immutable;

off-chain: transactions that occur outside the blockchain, such as in second-layer networks or private systems, and which may be faster and cheaper, but do not have the same transparency and security.

How do on-chain transactions work?

On-chain transactions work within the blockchain protocol, being processed by nodes that validate and verify transactions in blocks. These blocks are added to the existing chain, forming an immutable record of all previous transactions. Each transaction goes through a validation process, in which miners (in Proof of Work blockchains, such as Bitcoin) or validators (in Proof of Stake blockchains, such as Ethereum) ensure that it is legitimate, before including it in the next block. What are the advantages of on-chain transactions? On-chain transactions offer several advantages, due to the use of distributed records (blockchain): security: all transactions are verified and validated by a large number of participants, making them practically immutable; transparency: anyone can view transactions, which increases trust in the system; decentralization: no central authority controls transactions;

immutability: