The presentation on the Blockchain_Introduction_KR.pdf
- 1. “Introduction to Blockchain Technology” Ravi Kumar Mathur ADG, NTIPRIT National Telecommunications Institute For Policy Research, Innovation & Training
- 2. Blockchain • The technology behind cryptocurrencies. • Analogous to the internet When we have internet Why BlockChain? ≠ 𝐵𝑖𝑡𝑐𝑜𝑖𝑛
- 3. Problems which Internet failed to solve?? Trust Intermediary
- 4. Origin of Blockchain Short comings of current transaction system: » Cash is useful only in local transactions and in relatively small amounts. » The time between transaction and settlement can be long. » Duplication of effort and the need for third-party validation and/or the presence of intermediaries add to the inefficiencies. » Fraud, cyberattacks, and even simple mistakes add to the cost and complexity of doing business, and they expose all participants in the network to risk if a central system, such as a bank, is compromised. » Many people in the world don’t have access to a bank account and have had to develop parallel payment systems to conduct transactions. And transaction volumes will explode with the rise of Internet of Things (IoT)
- 6. Emergence of BitCoin BITCOIN- A digital currency to address the complexities, vulnerabilities, inefficiencies, and costs of current transaction systems. Advantages: »Cost-effective: Bitcoin eliminates the need for intermediaries. » Efficient: Transaction information is recorded once and is available to all parties through the distributed network. »Safe and secure: The underlying ledger is tamper evident. A transaction can’t be changed; it can only be reversed with another transaction, in which case both transactions are visible
- 7. The Birth of Blockchain • Bitcoin is actually built on the foundation of blockchain, which serves as bitcoin’s shared ledger. • This shared ledger can be used to record any transaction and track the movement of any asset whether tangible, intangible, or digital Bitcoin and blockchain are not the same. Blockchain provides the means to record and store bitcoin transactions, but blockchain has many uses beyond bitcoin. Bitcoin is only the first use case for blockchain
- 8. • Blockchains are Distributed Ledgers • Ledgers are historically centralized and private • Blockchains are Decentralized or Distributed
- 9. Open Ledger a d b c a= 10k a->b:5k a->b:5k b->d:5k b->d:5k d->c:5k d->c:5k a->c:15k
- 10. Distributed Ledger a d b c a= 10k a->b:5k a->b:5k b->d:5k b->d:5k d->c:5k d->c:5k a->c:15k a= 10k a->b:5k b->d:5k d->c:5k a= 10k a->b:5k b->d:5k d->c:5k a= 10k a->b:5k b->d:5k d->c:5k a= 10k a->b:5k b->d:5k d->c:5k
- 11. Synchronising Distributed Ledger a d b c a->b:5k b->d:5k a->b:5k b->d:5k a->b:5k b->d:5k a->b:5k b->d:5k a->b:5k b->d:5k Miner Miner Validate KEY(nonce) b->c:5k b->c:5k Mining
- 13. The blockchain is a decentralized, distributed ledger (public or private) of different kinds of transactions arranged into a P2P network. This network consists of many computers, but in a way that the data cannot be altered without the consensus of the whole network. Blockchain Architecture
- 14. Data structures used in blockchain: • Pointers - variables that keep information about the location of another variable. Specifically, this is pointing to the position of another variable. • Linked lists - a sequence of blocks where each block has specific data and links to the following block with the help of a pointer. Blockchain Architecture
- 16. Block header The head of the block have following components: 1. the hash of the previous block 2. the hash of the block 3. the root hash of the Merkle tree 4. the time in seconds 5. the goal of the current difficulty 6. the nonce Blockchain Architecture Block Hash = (Prev block Hash) Ɵ (Merkel Root) Ɵ Nonce
- 18. Proof of work • A proof of work is a piece of data which is difficult (costly, time- consuming) to produce but easy for others to verify and which satisfies certain requirements. • In order for a block to be accepted by network participants, miner must complete a proof of work which covers all of the data in the block. • The difficulty of this work is adjusted so as to limit the rate at which new blocks can be generated by the network to one every 10 minutes. • Due to the very low probability of successful generation, this makes it unpredictable which worker computer in the network will be able to generate the next block.
- 19. Other Consensus Algorithm • Proof of Stake • Proof of Burn • Proof of Capacity • Proof of elapsed time
- 21. Click here for summary video
- 22. Core Blockchain component Node • User or computer within the blockchain architecture (each has an independent copy of the whole blockchain ledger) Transaction • Smallest building block of a blockchain system (records, information, etc.) that serves as the purpose of blockchain Block • a data structure used for keeping a set of transactions which is distributed to all nodes in the network Chain • a sequence of blocks in a specific order Miners • specific nodes which perform the block verification process before adding anything to the blockchain structure Consensus • a set of rules and arrangements to carry out blockchain operations
- 23. Types of Blockchain Public • A public blockchain architecture means that the data and access to the system is available to anyone who is willing to participate (e.g. Bitcoin, Ethereum, and Litecoin blockchain systems are public). Private • As opposed to public blockchain architecture, the private system is controlled only by users from a specific organization or authorized users who have an invitation for participation. Consortium • This blockchain structure can consist of a few organizations. In a consortium, procedures are set up and controlled by the preliminary assigned users.
- 24. Property Public blockchain Consortium blockchain Private blockchain Consensus determination All miners Selected set of nodes Within one organization Read permission Public Public or restricted Public or restricted Immutability level Almost impossible to tamper Could be tampered Could be tampered Efficiency (use of resources) Low High High Centralization No Partial Yes Consensus process Permissionless Needs permission Needs permission
- 25. Ethereum • Functions as a platform through which people can use tokens to create and run applications and create smart contracts • Ethereum allows people to connect directly through powerful decentralized super computer • Language- Solidity • Currency- Ether • Uses- POS
- 26. Smart Contracts • A smart contract is an agreement or set of rules that govern a business transaction; • It’s stored on the blockchain and is executed automatically as part of a transaction • Their purpose is to provide security superior to traditional contract law while reducing the costs and delays associated with traditional contracts
- 27. Hyperledger Hyperledger is an open source collaborative effort created to advance cross-industry blockchain technologies. It is a global collaboration, hosted by The Linux Foundation, including leaders in finance, banking, Internet of Things, supply chains, manufacturing and Technology.
- 28. Information consensus Across Multiple Parties: Sophisticated cryptographic authorization and verification mechanisms enable trust in shared data across complex multi-party networks Time Stamping: Timestamped events are agreed upon across multiple, possibly hostile or non-trusting entities Security: Secure encryption and verification technologies enable untrusted participants to securely share trustable information with a third party. Authenticity: Digital signatures provide authenticity and non-repudiation B2B Ownership: End-to end asset lifecycles including ownership, custody and provenance can be tracked Data Loss Protection: Universal data loss becomes a lesser issue
- 29. Applications of Blockchain Technology
- 30. Possible Verticals for blockchain technologies are practically endless, including
- 31. Thank You! Ravi Kumar Mathur ADG, NTIPRIT [email protected]
- 32. String Hash ntiprit 6fef3bb73bc6c7b53c70d64ab1e6e5f8bb7278f68a0e7ad0d1e057ea6ede9af4 NTIPRIT cafb724876f3b7d79ec22021c3f29d62e1cca70a0217625d51c1e0d34be17113 Ntiprit 578b5ebf1b0eaf70e72121fa158b3a3d58005730f9358e5aab074ada373c0bbf