BLOCKCHAIN TECHNOLOGY

 

INTRODUCTION TO BLOCKCHAIN TECHNOLOGY

Introduction:-

Blockchain is an emerging technology platform for developing decentralized applications and data storage, over and beyond its role as the technology underlying the cryptocurrencies. The basic theory of this platform is that it allows one to create a distributed and replicated ledger of events, transactions, and data generated through various IT processes with strong cryptographic guarantees of tamper resistance, immutability, and verifiability. Public blockchain platforms allow us to guarantee these properties with overwhelming probabilities even when untrusted users are participants of distributed applications with ability to transact on the platform. Fundamentally there are
Three types of blockchains:- 

    1. public

    2. private and

    3. Hybrid.

In a public blockchain, anyone can connect to the blockchain and with an appropriate computer and software and become a blockchain server node. No permission is needed. In a private blockchain which is typically owned and managed by a company or group of companies, permission is needed to join the private blockchain. The entire concept of blockchain is a combination of a handful of different concepts and techniques i.e. a distributed ledger system, peer-to-peer network, key cryptography, hashing,  etc.

1. Blockchain Technology and Bitcoin Cryptocurrency

Blockchain is simply a data structure where each block is linked to another block. The blocks are linked to each other in a time-stamped chronological order. It is distributed digital ledger of an immutable, public record of digital transactions.

History of Bitcoin:-  Bitcoin was invented in 2008 by an unknown person or group of people using the name Satoshi Nakamoto and started in 2009 when its source code was released as open-source software. Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services.

The Bitcoin whitepaper, Bitcoin: A Peer-to-Peer Electronic Cash System, was published in 2008 by Satoshi Nakamoto. Bitcoin is a digital payment currency that utilizes cryptocurrency (a digital medium of exchange) and peer-to-peer (P2P) technology to create and manage monetary transactions as opposed to a central authority. The open source Bitcoin P2P network creates the bitcoins and manages all the bitcoin transactions.

  Definition and Characteristics of Blockchain Basics Of Blockchain Every new record is validated across the distributed network before it is stored in a block. All information stored on the ledger is verifiable and auditable. Each block is identified by its cryptographic signature.

Distributed : In this distributed type database is controlled by n number of nodes at the same time.

Anonymous : No identity like pan card, Adhar Card, Voter Id, any physical identity have to be submitted, an  anonymous identity is given by the system which is called address.

Time- stamped : Each block is time stamped in a chronological order, transactions are also time stamped.

Unanimous: The whole distributed network are executing operations unanimously, every one is agree and every one is conscious of what they are doing.

Immutable: The ledger is immutable because everyone is working on same ledger.

Secure: Blockchain is  secure because ledger is immutable.

Programmable: Blockchain is a programmable database.  

CRYPTOGRAPHY :-

1.Symmetric key cryptography :- This type of encryption is an encryption methodology that uses a single key to encrypt (encode) and decrypt (decode) cryptography data. It is the oldest and most well-known technique for encryption. The secret key can be a word, a number, or a string of letters, and it's applied to a message.

2.Asymmetric key cryptography :- In such type of cryptographic arrangement, every node has two keys; Private key and Public key. The private key is known only to the node owner whereas the public key is known to all the nodes in the network. The combination of a private key and a public key makes a unique digital signature for every node. This makes the node authentic to carry out transactions and verifications.

Blockchain as a secure record keeping system:-

Blockchain are the way of ordering and verifying transaction in a verified ledger. In the block chain thousands of computers in a distributed network use cryptographic techniques to create a permanent, public record of every single transaction that has occurred science creation of ledger.

Different Features of Blockchain:- Blockchain are Recorded Transactions, Decentralized, Validity by many, Requires Consensus, Transparent and  Unable to Hack.

Features of Blockchain Based Solutions are :

  • Complexity reduction,
  • Shared trusted transaction,
  • Error reduction,
  • Auditable,
  • Straight-through-processing, and
  • Secure.

Benefits of Blockchain Based Solutions are:

  • Transaction time changes from days to near instantaneous,
  • Overheads and cost intermediated reduction,
  • Reduces the risk of tampering, and
  • Reduces fraud and cyber crime.

Types of Bitcoin Wallet

Web Wallets :- These are websites or even online exchange that allows storage examples are Blockchain.info, Greenaddress, Coinbase, Coinbase Value Storage.

Mobile Wallets:- A smartphone wallets is easy to scane QR codes to make quick payments example: Breadwallet, Mycelium, AirBitz, GreenBits.

Desktop Wallets:- These are apps installed in desktop computer or laptap. Examples are Electrum, Multibit, Armory.

Hardware Wallets:- A piece of hardware is used to store the private key to our bitcoins. Examples are Coindesk, Bitadress.

Multi-Signature Wallets:- These wallets require multiple private key signatures to make a transactions. Examples are CarbonWallet, Coinbase, Blocktrail, Coinkite.

2. Ehereum And SmartContracts

Ethereum: Ethereum was conceptualized by Vitalik Buterin in November 2013, it is a distributed public Blockchain network. The key idea proposed was the development of a Turing-complete language that allows the development of smart contracts for blockchain and decentralized applications.

Ethereum aims to enable innovations in four key areas: Currency issuance, Decentralized Autonomous  Organizations (DAO), Smart Contracts, Smart Property.

Smart Contract: A smart contract is computerized transaction protocol that executes the terms of a contract. When running on the blockchain a smart contract becomes like a self-operating computer program that automatically executes when specific conditions are met.

Comparison Between Bitcoin & Ethereum


Feature

Bitcoin

Ethereum

Concept

Digityal Money

World Computer

Founder

Satoshi Nakamoto (unknown)

Vitalik Buterin and team

Scripting Language

Turing incomplete

Turing Compleate

Release Date

Jan 2009

July 2015

Coin Release Method

Early mining

Through ICO

Average block time

~10 minuites

~ 12-15 seconds


Hyperledger :-


Hyperledger is an open source community focused on developing a suite of stable frameworks, tools and libraries for enterprise-grade blockchain deployments. It serves as a neutral home for various distributed ledger frameworks including Hyperledger Fabric, Sawtooth, Indy, as well as tools like Hyperledger Caliper and libraries like Hyperledger Ursa.


Solidity Solidity is an object-oriented, high-level language for implementing smart contracts. Smart contracts are programs which govern the behaviour of accounts within the Ethereum state. Solidity was influenced by C++, Python and JavaScript and is designed to target the Ethereum Virtual Machine (EVM). Solidity is statically typed, supports inheritance, libraries and complex user-defined types among other features. With Solidity we can create contracts for uses such as voting, crowdfunding, blind auctions, and multi-signature wallets.


Hashgraph A hashgraph is a patented algorithm that promises the benefits of the blockchain (decentralization, distribution, and security through the use of hashing) without the drawback of low transaction speed. It was created by Leemon Baird and is the intellectual property of the Swirlds Corporation, which Baird founded. While Bitcoin allows for approximately 5 transactions per second and Ethereum allows for approximately 15 transactions per second, a hashgraph can process thousands of transactions per second.

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