Introduction to Blockchain and Crypto-Currencies

Basics of Blockchain concepts

Topic of Discussion

• Architecture of Blockchain
• Properties of Blockchain
Definition
• A decentralized computation and information sharing platform that enables
multiple authoritative domains ,who do not trust each other, to
cooperate ,coordinate and collaborate in a rational decision making process.
Definition

Blockchain is defined as a distributed, replicated peer-to-peer network of databases that allows

multiple non-trusting parties to transact without a trusted intermediary and maintains an ever-
growing, append-only, tamper-resistant list of time-sequenced records.
Blockchain can be considered as a type of a distributed ledger that sits on the internet for recording
transactions and maintaining a permanent and verifiable record-set of information.
An Example
Microsoft word to Google Doc-Information sharing
Blockchain –Internet database to support Decentralization
Preliminary Concepts
• Peer-to-Peer (P2P) Network
• Cryptography
• Encryption/Decryption
• Hash Chain
• Merkle Tree
• Digital Signatures & Timestamp
Properties of Blockchain
• Decentralization
• Transparency
• Immutability
• Traceability
• Anonymity
• Automatic
• Democratized
• Integrity
• Programmability
• Fault Tolerance In blockchain technology, one cannot modify data or transactions once they are recorded in
the blockchain database. It becomes a permanent record that is close-to-impossible to
undo. Any change required can be addressed only by adding a new block of data to the
existing chain of blocks in chronological order ensuring that the database is complete and
consistent.
Blockchain
Component of Blockchain

1. Node

2. Ledger a ledger records transactions

A blockchain wallet is a digital wallet that allows users to store and manage their Bitcoin,
3. Wallet Ether, and other cryptocurrencies

A random number whose value is set so that the hash of the block will contain a run
4. Nonce
of leading zeros.

5. Hash
Mining is the process of validation of adding transaction records to the blockchain network
6. Mining and confirm the same to the rest of the network.

makes sure that every new block that is added to the Blockchain is the one and only
7. Consensus protocol version of the truth that is agreed upon by all the nodes in the Blockchain.
Blockchain
Blockchain
What is a Block in Blockchain

The block is a record that contains the transaction data details. It

comprises of following details:
• Hash of the block – Alphanumeric number to identify the block
• Hash of the previous block.
• Timestamp
• Nonce – the random number used to vary the value of the hash
• Merkle Root – hash of all the hashes of all the transactions in the block
• Transaction data. (Note: This contains details of several transactions)