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What Is Blockchain

Blockchain is a platform for executing transactional services across multiple untrusting organizations. It uses an append-only shared ledger of cryptographically signed transactions replicated across peer nodes. A block contains a series of transactions and reference to the previous block, securing the data immutably on the distributed ledger.

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Meenakshi Rajput
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42 views11 pages

What Is Blockchain

Blockchain is a platform for executing transactional services across multiple untrusting organizations. It uses an append-only shared ledger of cryptographically signed transactions replicated across peer nodes. A block contains a series of transactions and reference to the previous block, securing the data immutably on the distributed ledger.

Uploaded by

Meenakshi Rajput
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
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What is blockchain?

It is platform for executing transactional services

Transaction leads to certain operations in the real physical world

Spanned over multiple organizations or individuals who may not


(need not) trust each other

An append-only shared ledger of digitally signed and encrypted


transactions replicated across a network of peer nodes.
The block in Blockchain - Securing data cryptographically
 Digitally Signed and
encrypted
transactions
“verified” by peers
 Cryptographic
Security – Ensures
that participants
can only view
information on the
ledger that they are
authorized to see
Structure of the Block
 A block is container data structure that contain series
of transactions
 In Bitcoin: A block may contain more than 500
transactions, the average size of the block is around
1MB(an upper bound proposed by Satoshi
Nakomoto in 2010)
 May grow upto 8MB or sometime higher (several
conflicting views on this!!)
 Larger blocks can help in processing large amount of
transactions in one go
 But longer time for verification and propagation
Structure of the Block
Two Components:
Block Header & List of transactions

Block Source: https://btc.com/btc/blocks OR https://blockchain.com/explorer


Block Header (Ref. Bitcoin)
 Metadata about a block: 1.
Previous block hash, 2.
Mining Statistics used to
construct a block, 3. Merkle
tree
 Previous block hash: Every
block inherits from the
previous block- we use
previous block’s hash to
create a new block’s hash –
make the blockchain tamper
proof
Block Generation Puzzle

• Find out the nonce that generate the desired


hash(certain no. of zero bits as prefix)
Block Header (Ref. Bitcoin)
 Mining – the mechanism to generate hash
 The mechanism needs to be complex enough, to make the
block chain tamper proof

 Bitcoin mining: H k
 Hash( H k 1 || T || Nonce || Somethingmore)

 Find the nonce such that Hk has certain predefined


complexity(number of zeros at the prefix)
 The header contains mining statistics – time
stamp, nonce and difficulty
Hashes in block header
Block identifier – the hash of current block header
(hash algorithm: Double SHA 256)
Merkle root
Previous block hash is used to compute the current
block hash
Time stamp, previous hash, , merkle root, difficulty bits,
nonce and version used to compute current hash
Demo: https://cse.buffalo.edu/blockchain/blockhash.html
Block source: https://btc.com/btc/blocks
Block no. 800 hash:
00000000def8545899ea7274e5c59bda5982f8f960052774df45b7d5c64f9
c5d
Types of Blockchain
Public
• a decentralized, distributed digital ledger that is open for
anyone to participate in, view, and validate
• multiple participants (nodes) work collaboratively to validate
and record transactions.
• Open Participation
Private
operates within a closed and controlled environment
access to the network and participation in consensus
mechanisms is limited to a specific group of participants or
entities.
Difference between public & private
blockchain
Public(permissionless) Private(permissioned)

Open Participation Restricted Access (permissioned access)

Decentralization (no single entity has Centralization(often operated by single


control over network) entity/ group of cooperating entity)
Transparency Privacy

Slow transactions Faster Transactions

high level of data immutability and their security can be compromised if the
security due to the consensus controlling entity decides to alter or
mechanisms like Proof of Work (PoW) or manipulate the data
Proof of Stake (PoS).
more resistant single points of failure. Prone to Single point of failure

more resistant to censorship attempts the controlling entity has the power to
censor or modify transactions or data
Public Private(permissioned)

Examples are bitcoin, ethereum, Example: Hyperledger Fabric

there are no restrictions in joining the it is decided beforehand as to who can


consensus process join the consensus and who are not
eligible

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