“Blockchain” is frequently mentioned at industry conferences as a transformative technology with the potential to “disrupt” the private funds industry. Given the frequency and reverence with which it is mentioned, at first glance it appears that blockchain technology is already widely used in the industry. Upon closer inspection, however, it becomes clear that widespread uncertainty persists about what blockchain even entails, not to mention where the technology currently stands and how it could plausibly be used to improve private fund operations. To help our subscribers understand the status of blockchain technology and its potential to aid the private funds industry, this three-part series serves as a primer about the technology and its interplay with the private funds industry going forward. This first article provides an overview of how blockchain functions and examines how the finance industry is already utilizing it. The second article will describe potential ways private funds and service providers can adopt blockchain technology to enhance fund operations and compliance practices. The third article will explore some of the risks impeding the growth of blockchain and address the most plausible timing and manner for it to be eventually adopted in the industry. For more on how fund managers can utilize technology, see “Hedge Fund Managers Are Advised to Build Robust Infrastructure” (Mar. 3, 2012); and our two-part series on automated trading strategies: “Examining and Documenting” (Jan. 7, 2016); and “Monitoring and Reviewing” (Jan. 14, 2016).