Blockchain

1. Submitted by:
Aditya Tiwari
B-Tech CSE
Roll.No. :-CSJMA19001390003
Submitted To:
Mr. Deepak Kumar Verma &
Mr. Sheshmani Tiwari
SSM- S401

2. B L O C K C H A I N

3. Table of Contents
 What is Blockchain?
 Features of Blockchain
 Blockchain Core Concepts
 History of Blockchain
 Why Is Blockchain Popular?
 Types of Blockchain
 Advantages & Disadvantages Of Blockchain
 Applications of Blockchain

4. What is Blockchain??
By Definition:
Blockchain is a shared, immutable ledger that
facilitates the process of recording transactions
and tracking assets in a business network.
An asset can be tangible (a house, car, cash, land)
or intangible (intellectual property, patents,
copyrights, branding). Virtually anything of value
can be tracked and traded on a blockchain
network, reducing risk and cutting costs for all
involved.

5. More on Blockchain
Blockchain is a distributed ledger that adds immutability. Immutability means that once something is written,
it can't be edited or removed. With blockchain, data cannot be modified. The full history of data can be traced
back to the start of the blockchain. Blockchain is a chain of transactions, contained in blocks, hence the name
blockchain.
Every time a piece of information is changed, instead of updating the value and losing sight of what it used to
be, blockchain simply adds a new block that holds the new data, while continuing to maintain all the old data
as well.
Blockchain terms:
 Ledger-
Oxford Learner’s Dictionaries define a ledger as “a book or electronic document in which a bank, a
business, etc. records the money it has paid and received.”
 Distributed ledger-
Distributed ledgers take the advantages of traditional or general ledgers and make them more resilient.
Instead of having a single copy of the master data, a distributed ledger shares the full data set across
several network participants (members); each member has a complete copy of the data.

6. Features Of Blockchain
 Decentralization
Decentralization means that each member of a blockchain has a complete copy of the data.
Each member having a copy of the data protects against bad actors, improves disaster
recovery, and promotes high availability.
 Transparency
Another piece of blockchain that increases trust is transparency. Transparency means that
the information stored in the blockchain is visible to the members of the blockchain.
Blockchain maintains a complete record of all transactions, and that record is available to
every member, making blockchain a very transparent technology.

7.  Immutability
Immutability simply means something cannot be edited or changed. You can update the
information in a blockchain by adding data, which will be added in a new block. However, once
a block is part of the chain, the information in that block can’t be changed.
 Auditability
Auditability is another benefit of using blockchain. Auditability speaks to how readily available
and accessible something is to audit. Blockchain, relying on the other benefits already
discussed, is a very auditable platform.

8. Blockchain Core Concepts
 Blocks
Blocks are the basic unit of information in blockchain. Recall that a set of transactions results in a new block being
created and added into the blockchain after the previous block.
A block itself has three primary components. The block is made up of the information for the current transaction, a
cryptographic hash of the previous block, and a time stamp.
 Transaction data- The transaction data is the actual information relevant to the blockchain. The information
contained will be largely dependent on the purpose of the transaction and the blockchain.
 Hash- A block also contains a cryptographic hash of the previous block in the blockchain. A cryptographic hash
is a unique string of characters that can only be created using the information in the block and the cypher key.
The hash is unique such that no other block, combined with the key, would produce the same hash. Additionally,
if any of the data were changed in the block, the hash would also change. This process of creating a
cryptographic hash of the previous block relates to blockchain’s immutability.
 The third piece of information in a block on a blockchain is a timestamp. Timestamps serve two purposes. The
obvious purpose of a timestamp is to know when a block was added to the blockchain. Due to the timestamp
being part of a block, the cryptographic hash already discussed will vary based on the timestamp. This means that
attempting to submit an edited block with a modified timestamp will run into the same problem with changing
hashes, and will ultimately be rejected by the blockchain.
A second purpose of the timestamp is to show that the blocks are in chronological order of creation. This is
important for auditability of the blockchain, because it ensures that any audit can validate the order information as
attached to the blockchain.

10.  Peer-to-peer network:
 Using a peer-to-peer network helps
make blockchain fault tolerant,
transparent, and distributed.
 Peer-to-peer networking also means
that a network disruption impacting
some of the peers won’t impact the
entire blockchain.
 In a peer-to-peer network, because all
members are equal, a network
disruption doesn’t prevent the
blockchain from continuing to function.
Once the disruption is resolved, the
impacted members can reach out to
any of the other members of the peer-
to-peer network to get updated to the
latest blockchain data set.

11.  Consensus mechanisms
 A consensus mechanism is a set of rules put in place by the blockchain that
determines how all the members recognize a valid block addition. Blockchains
immutability is directly related to consensus mechanisms.
 Consensus mechanisms are how each member of a blockchain knows that the
information they are receiving is valid information. Without a consensus mechanism,
anyone could submit an update to the blockchain and the chain would get updated.
 Consensus mechanisms also set the standard for how members prove to the rest of
the chain that an update is valid.
 Consensus mechanisms enable the distributed nature of the blockchain. Through the
consensus mechanisms, peers are able to share updates to the blockchain, and
ensure that everyone on the peer-to-peer network is using the same data set.
 Proof of Work and Proof of Stake are two common examples of consensus
mechanisms.

12.  Proof of Work:
Proof of work is a consensus mechanism in which members solve mathematical puzzles. The
first member to solve the puzzle is trusted and is able to create the next block on the
blockchain. This consensus mechanism prioritizes the member that’s put the most effort into
solving a puzzle to determine who writes the next block. Though a proof-of-work blockchain
gives each member an equal opportunity to create the next block, it can be very process
intensive (and therefore energy intensive).
 Proof of Stake:
In a proof of stake mechanism, the more cryptocurrency a member has, the greater trust is
given to that member. With this increased trust comes an increased likelihood of being the
member that creates the next block on the blockchain. Proof of stake is far less resource
intensive than proof of work. However, proof of stake doesn’t treat all members equally. Instead,
it focuses on which members have the most coins.

13.  Smart Contracts:
A smart contract is a contract that executes without any additional
action required by a third party. With a smart contract, you establish
the terms and conditions of the contract. Once the terms and
conditions of the contract are met on the blockchain, the contract
automatically executes—without you needing to take any action.

14. HISTORY OF BLOCKCHAIN
Although blockchain is a relatively
new technology, it already boasts a
rich and interesting history. The
following is a brief timeline of some of
the most important and notable
events in the development of
blockchain.

15. Blockchain Evolution
 The first concept of blockchain dates back to 1991, when the idea of a
cryptographically secured chain of records, or blocks, was introduced by Stuart
Haber and Wakefield Scott Stornetta. Two decades later the technology gained
traction and widespread use. The year 2008 marked a pivotal point for blockchain,
as Satoshi Nakamoto gave the technology an established model and planned
application. The first blockchain and cryptocurrency officially launched in 2009,
beginning the path of blockchain’s impact across the tech sphere.

16. Blockchain Over The Years:
 2008
 Satoshi Nakamoto, a pseudonym for a person or group, publishes “Bitcoin: A Peer to Peer Electronic Cash System.”
 2009
 The first successful Bitcoin (BTC) transaction occurs between computer scientist Hal Finney and the mysterious Satoshi Nakamoto.
 2010
 Florida-based programmer Laszlo Hanycez completes the first ever purchase using Bitcoin — two Papa John’s pizzas. Hanycez
transferred 10,000 BTCs, worth about $60 at the time.
 The market cap of Bitcoin officially exceeds $1 million.
 2011
 1 BTC = 1 USD, giving the cryptocurrency parity with the US dollar.
 2013
 BTC market cap surpassed $1 billion.
 Bitcoin reached $100/BTC for the first time.
 Buterin publishes the “Ethereum Project” paper, suggesting that blockchain has other possibilities besides Bitcoin (like smart
contracts).
 2014
 PayPal announces Bitcoin integration.
 The first-known NFT is minted
 2016
 The government of Japan recognizes the legitimacy of blockchain and cryptocurrencies.

17.  2017
 Bitcoin reaches $1,000/BTC for the first time.
 Cryptocurrency market cap reaches $150 billion.
 Bitcoin reaches its all-time high at $19,783.21/BTC.
 2018
 Facebook commits to starting a blockchain group and also hints at the possibility of creating its own cryptocurrency.
 IBM develops a blockchain-based banking platform with large banks like Citi and Barclays signing on.
 2020
 BTC almost reaches $30,000 by the end of 2020.
 Blockchain becomes a key player in the fight against COVID-19, mainly for securely storing medical research data and
patient information.
 2021
 Bitcoin surpasses $1 trillion in market value for the first time.
 Popularity for the implementation of Web3 rises.
 El Salvador becomes first nation to adopt Bitcoin as legal tender.
 Tesla buys $1.5 billion in BTC, becoming the first car manufacturer to accept Bitcoin as a form of automobile payment.
 The metaverse, a virtual environment incorporating blockchain technology, garners mainstream attention.
 2022
 Cryptocurrency loses $2 trillion in market value, due to economic inflation and rising interest rates.

18. Why Is Blockchain Popular?
Blockchain is an emerging technology with many advantages in an
increasingly digital world:
 Highly Secure
 It uses a digital signature feature to conduct fraud-free transactions making it
impossible to corrupt or change the data of an individual by the other users
without a specific digital signature.
 Decentralized System
 Conventionally, you need the approval of regulatory authorities like a government or
bank for transactions; however, with Blockchain, transactions are done with the
mutual consensus of users resulting in smoother, safer, and faster transactions.
 Automation Capability
 It is programmable and can generate systematic actions, events, and payments
automatically when the criteria of the trigger are met.

19. Types of Blockchain
 There are four main types of
blockchains:
1. Public Blockchain Networks
2. Private Blockchain Networks
3. Permissioned Networks
4. Consortium

20. Public Blockchain Networks
A public blockchain is one that anyone can join and
participate in, such as Bitcoin. Drawbacks might
include substantial computational power required,
little or no privacy for transactions, and weak security.
These are important considerations for enterprise use
cases of blockchain.
Ex- Bitcoin , Ethereum

21. Private Blockchain Networks
A private blockchain network, similar to a public blockchain network, is a decentralized
peer-to-peer network. However, one organization governs the network, controlling
who is allowed to participate, execute a consensus protocol and maintain the shared
ledger. Depending on the use case, this can significantly boost trust and confidence
between participants. A private blockchain can be run behind a corporate firewall and
even be hosted on premises.
Ex-Fabric, Sawtooth, Corda etc.

22. Permissioned Networks
Also sometimes known as hybrid blockchains,
permissioned blockchain networks are private
blockchains that allow special access for authorized
individuals. Organizations typically set up these
types of blockchains to get the best of both worlds,
and it enables better structure when assigning who
can participate in the network and in what
transactions.

23. Consortium Blockchains
Similar to permissioned blockchains, consortium
blockchains have both public and private
components, except multiple organizations will
manage a single consortium blockchain network.
Although these types of blockchains can initially be
more complex to set up, once they are running, they
can offer better security. Additionally, consortium
blockchains are optimal for collaboration with
multiple organizations.
Ex- Energy Web Foundation, R3

24. Advantages & Disadvantages
of Blockchain

25. ADVANTAGES
 Greater trust
With blockchain, as a member of a members-only network, you can rest assured that you are
receiving accurate and timely data, and that your confidential blockchain records will be shared
only with network members to whom you have specifically granted access.
 Greater security
Consensus on data accuracy is required from all network members, and all validated transactions
are immutable because they are recorded permanently. No one, not even a system administrator,
can delete a transaction.
 More efficiencies
With a distributed ledger that is shared among members of a network, time-wasting record
reconciliations are eliminated. And to speed transactions, a set of rules — called a smart contract
— can be stored on the blockchain and executed automatically.

26. DISADVANTAGES
 Significant technology cost associated with mining bitcoin
 Low transactions per second
 History of use in illicit activities, such as on the dark web
 Regulation varies by jurisdiction and remains uncertain
 Data storage limitations

27. BLOCKCHAIN APPLICATIONS
TOP BLOCKCHAIN
USES & APPLICATIONS
• Cryptocurrency
• Cybersecurity
• Accounting and record
keeping
• Supply chain
• Healthcare
• Finance Services
• Government

28. Questions

29. THANK YOU
Name : Aditya Tiwari
Roll no : 003
Batch : 2K19
Course : B-Tech (CSE)