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  1. A SEMINAR ON BITCOIN TECHNOLOGY (A Peer-to-Peer Electronic Cash System) Presented By  Habtamu Wubalem Instructor –Mr.Alemu K. Date may 27/2018
  2. Contents  Introduction  History  Algorithm  How to use Bitcoin?  Benefit of Bitcoin  Application  Related currency  Conclusion
  3. Introduction  The existence of digital currencies total distributing the world economy to change we use todays traditional way. the invention of internet ,encyclopedia, amazon they are break the way information are transferred to one another.  A digital currency is electronic money but even if it can be used to buy services or physical goods like traditional money.  Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network.  Bitcoin is money what internet is to information.
  4. Cont.. To understand the applications and implications of the technology, it’s first important to define the terminology.  Cryptocurrency is an electronic currency and asset.  Bitcoin is the today well-known Cryptocurrency underpinned by blockchain technology.  A blockchain is a type of distributed ledger, which enables records to be stored and sorted into blocks. Blockchain can create trust, which may remove the need for third parties.
  5. Cont..  Distributed ledger technology- is a family of technologies that includes blockchain, where a ledger is maintained by a group of peers rather than a single central authority.  Miner – A peer in the Bitcoin blockchain network that confirms or verifies a transaction by solving a challenging cryptographic problem and adds the transaction or ‘block’ to the blockchain.  Keys: Addresses used to validate and secure transactions. Public keys can only be used to view the balance and transactions. To make transactions, a private key is needed to verify ownership of an account.  Node: A computer connected to the blockchain network that stores a copy of the public ledger. Some nodes also mine to verify transactions.
  6. History  Bitcoin is a peer-to-peer electronic payment system introduced as open source software in 2009 by developer Satoshi Nakamoto.  The digital currency created and used in the system is also called Bitcoin and is alternatively referred to as a virtual currency, electronic money, or crypto currency
  7. How it works? The basics for a new user  you have installed a Bitcoin wallet on your computer or mobile phone, it will generate your first  Bitcoin address and you can create more whenever you need one. You can disclose your addresses to your friends so that they can pay you or vice versa. In fact, this is pretty similar to how email works, except that Bitcoin addresses should only be used once
  8. Cont...
  9. Transactions  As we know information was copied not transfer completely. For example when I use email attach document to send somebody the file is already copied /attached to that person.  So the interesting thing was value/material should give to peers original.  so how digital coin can transfer? How to exchange the value of thing(money) transfer without copied was difficult to the pervious computer scientists.  If Somebody assign to validate the transaction of money .  how can we trust ? How are trust that digital orange transfer between two peers are also copied for himself and share for other peers before transaction?
  10. Cont..  To solve this problem the book keeping or ledger to make public see by everybody in the internet and everyone can check/control digital orange . If some one interruption /change the ledger but all rest computer record are to different because the leger are distributed to all computer so disqualified .  This orange are Bitcoin and the techniques called Bitcoin protocol.
  11. Cont.. What block chain ? -community base technology which manages by public and maintain Update check to how the information was correct based on distributed computing ledger keeping work. Simple Meaning definition -block –box, Chain-interconnected.  the first block was created by Satoshi Nakamoto called “Genesis block”
  12. Cont..  Bitcoin mining is the processing of transactions in the digital currency system, in which the records of current Bitcoin transactions, known as a blocks, are added to the record of past transactions, known as the block chain.  By solving a challenging cryptographic problem updating the ledger. Bitcoin are created as a reward for payment processing work in which users who offer their computing power verify and record payments into a public ledger. Called mining, 12.5 BTC per block are awards. (*** Now 1BTC= 8,130.58$ in USA Dollar***)  Bitcoin generally started with individuals and small organizations mining.
  13. Mining
  14. Algorithm  Public Key Cryptography is an asymmetric encryption scheme that uses two sets of keys: a public key that is widely disseminated and a private key that is only known to the owner.  Public key cryptography can be used to create digital signatures and is used in a wide array of applications, such as HTTPS internet protocol, for authentication in critical applications and also in chip-based payment cards.  Wallet: The digital keys are not actually stored in the network, but are instead created and stored by users in a file, or simple database, called a wallet  Think of the public key as similar to a bank account number and the private key as similar to the secret PIN.
  15. Cont.. Private Key  A private key is simply a number, picked at random. Used to create signatures that are required to spend Bitcoins.  The private key must remain secret at all times, because revealing it to third parties is equivalent to giving them control over the Bitcoins secured by that key.  The private key must also be backed up and protected from accidental loss, because if it’s lost it cannot be recovered and the funds secured by it are forever lost, too. Public Key  The public key is calculated from the private key using elliptic curve multiplication, which is irreversible: Where k is the private key K is the resulting public key G is a constant point called the generator point.
  16. Cont..  A private key can be converted into a public key, but a public key cannot be converted back into a private key because the math only works one way.  Bitcoin Addresses  It is a string of digits and characters that can be shared with anyone. Addresses are produced from Public Keys through the use of one- way cryptographic hashing.  For key exchange use Diffe-Hellman key exchange  For hashing SHA 256,RIPEMD and Elliptic curve for generating a finite group Discrete logarithmic problem hard to solve
  17. Advantage  Transparency All information concerning the Bitcoin money transaction are free see .No individual or organization can control or manipulate the Bitcoin protocol because it is cryptographically secure.  Security :-protect from single point of attack.  Payment freedom - It is possible to send and receive any amount of money instantly anywhere in the world at any time. No bank holidays. No borders. No imposed limits. Bitcoin allows its users to be in full control of their money.  Very low fees - Bitcoin payments are currently processed with either no fees or extremely small fees.  Security and control - Bitcoin users are in full control of their transactions; Bitcoin payments can be made without personal information tied to the transaction. This offers strong protection against identity theft. Bitcoin users can also protect their money with backup and encryption.
  18. Disadvantage  Acceptance issue.  Can be use for other malicious activities because of unknown as payment option.  No one can regulate the Cryptocurrency .  Government issue because of Bitcoin so powerful.  Denial of service.
  19. How to use Bitcoin ?  Using Bitcoin as an Individual simple just Install the official Bitcoin client on your computer.  To get started using Bitcoin, Bitcoin page to set up your account on the computer. Software are compatible for Mac, Windows, and Linux. Set up your wallet:  Like regular money, you've got to have a place to keep your digital money. Wallets are basically programs that sort and track your digital currency via your account settings.  There are a variety of options available, depending on your intentions for using Bitcoin.  Software wallet ( eg. BitcoinQT, Armory)  Hardware wallet  Web wallet
  20. Cont..  Web wallets are always available online, making them probably the most convenient and user friendly. Web wallet options include: eg.( Coinbase, Blockchain, Coinjar)  Bitcoin also link with bank to buy and sell for the transaction fees.
  21. Cont.. Web wallets
  22. Application Behind Bitcoin it was a block chain are not only limited to Bitcoin we can transfer services like smart contract, vote ,digital identity ,house selling and buying option .  Ecommerce:- Airline ticket reservation (Expedia).  Microsoft XBOX Game:-purchase game through Bitcoin.  Health -transfer of patient information securely.  Digital identity.  Smart Contract :-are contracts whose terms are recorded in a computer language instead of legal language. Smart contracts can be automatically executed by a computing system, such as a suitable distributed ledger system By to create a digital agreement.  Rural Area :-which that are not infrastructure of Banking system.
  23. Related currency Bitcoin (BTC) Ethereum (ETH) Ripple (XRP) Bitcoin Cash (BCH) Lite coin (LTC) **Almost 1000 digital Currency are develop ***Now current 1BTC=8,130.58$
  24. Conclusion  My recommendation to this technology , anybody can invest in the Bitcoin and participate in the mining was difficult for individual but can join to other organization by contributing of some hardware material. According to the donation of material for mining process you can have get profit distribution.  you can customize and develop own digital Cryptocurrency the code because Bitcoin was 100% free open source platform.