2. Objectives
What is blockchain?
How does it work?
Use cases
Why is it almost impossible to hack?
Cryptocurrency (Bitcoin)
Cryptocurrency Mining
A basic Transaction
1.
2.
3.
4.
5.
6.
7.
3. A blockchain is a decentralized, distributed, and oftentimes public,
digital ledger consisting of records called blocks that are used to
record transactions across many computers so that any involved
block cannot be altered retroactively, without the alteration of all
subsequent blocks.
So simply it is a blockchain is a chain of blocks that contains
information
4. Blockchain technology was first outlined in 1991 by Stuart
Haber and W. Scott Stornetta, two researchers who wanted to
implement a system where document timestamps could not
be tampered with.
8. To solve these problems the concept of
cryptocurrencies came into existence.
Cryptocurrencies are a form of digital
or virtual currency that runs on
blockchain technology.
9. Thanks to blockhain
Thanks to blockchain technology cryptocurrencies are
immune to
counterfeiting
don't require a
central authority
protected by strong and
complex encryption
algorithm
10. As previously mentioned, the blockchain is a distributed ledger that is
completely open to anyone and it has some interesting properties.
Once any data has been recorded inside the blockchain, it becomes
very difficult or almost impossible to change it.
17. Modern computers can computer hundreds of
thousands of hashes per second hence they can
tamper with a block and then compute and replace
hashes of all other blocks so using hash only is not
enough.
So to mitigate this, blockchain has something called
Proof of Work. It is a mechanism that slows down the
creation of new blocks.
18. In Bitcoin's case, it takes around 10 minutes to
calculate the required Proof of Work and add a new
block to the blockchain.
19. Hashing
Proof of Work
Till now we know Blockchain has 2 security method:
1.
2.
But there is an additional method which is distributing
the chain. Instead of using a central entity, blockchain
uses a P2P network where everyone is allowed to join.
20.
21.
22.
23. Now we can easily understand how a real-life bitcoin
transaction occurs.
So let's get to it.
28. Hence after the calculation of Proof of Work and adding
the block to the blockchain, the bitcoin wallet of Phil, Jack,
and other people who did any transaction is updated
29. If anyone has any questions,
please feel free to ask now
