This document provides an introduction to blockchain technology. It defines blockchain as a distributed database of records stored in immutable blocks connected with prior blocks forming a chain, where the validity is affirmed by peers in a decentralized network secured by cryptography. It discusses key aspects of blockchain including decentralization, transparency, immutability, consensus mechanisms, and applications such as financial transactions, digital identity, and peer-to-peer networks. Permissioned blockchains are also covered as a way to allow distributed transparency and immutability while controlling access. Regulatory compliance is noted as an important consideration for blockchain implementations.

1. Blockchain
An introduction

2. About Me
● Studied at IIT (2018)
● Senior Software Engineer at WSO2 Financial Solutions.
○ Works with PSD2/CDR Open Banking.
● Identity And Access Management enthusiast.
Tweet me @enigmamaker
Web: kaveenrodrigo.com
Email: u.k.k.rodrigo@gmail.com

3. What’s in store for today.
1. Why blockchain?
2. What’s a blockchain?
3. Applications.
4. Takeaway points.
Photo by Hitesh Choudhary on Unsplash

4. Blockchain ≠ Cryptocurrency

5. Why
Blockchain?
The 3 pillars/layers

6. Decentralized
● No centralized administration or governance.
● Traditional systems implemented with client-server architecture
depends on the centralized server as a single point of trust. IE-Bank.
TE
C C M
C
N N N
N
N
Centralized Decentralized
Single Point of failure
Acces governed
by entity

7. Transparent
● With distribution throughout a network, records are introspectable.
● Transactions are propagated through all parties.
TE
C C M
C
Centralized
Alice → Bob 10LKR
Send Alice 5LKR
Bob → Alice 5LKR
Alice → Bob 10LKR
Bob → Alice 5LKR
Alice → Bob 10LKR
Bob → Alice 5LKR
Decentralized
Send Alice 5LKR
Alice → Bob 10LKR
Bob → Alice 5LKR
Alice → Bob 10LKR
Bob → Alice 5LKR
N N N
N
N

8. Bob → Alice 5LKR
Immutable
● Data upon entry is unmodifiable.
● Prior transactions cannot be tampered.
● Archived through hashing/cryptography.
TE
Centralized Decentralized
Alice → Bob 10LKR
N
Bob → Alice 5LKR
Bob → Alice 5LKR
Alice → Bob 10LKR
N
Alice → Bob 10LKR

9. Brief History on Blockchain
Person/s Satoshi Nakamoto
conceptualized blockchain on the
paper “Bitcoin: A Peer-to-Peer
Electronic Cash System”
And then proceeded to
implement Bitcoin with the first
block to come into existence on
3rd January 2009.
Photo by André François McKenzie on Unsplash

10. What’s a
Blockchain?

11. ● Record - A transaction, piece of information, etc.
● Block - A collection of valid records hashed/linked to the prior block.
● Blockchain - A collection of blocks linked with hashes.
Blockchain On A Slide
Record Block Blockchain

12. Bitcoin Genesis Block

13. ● Hash functions allow to map data of arbitrary size to a fixed-size value.
● Hash algorithms follows two basic principles
○ Should be fast to compute.
○ Minimize duplications/collisions.
● Hashes are used in blockchain to give it’s immutability.
Sidetrack.
What’s a Hash?
sha1("Kaveen Says Hi") >> '20c92f68ba982b54b2d867aa522b64a8fd09f231'
sha1("Kaveen Says Goodbye") >> '8311a7bcc8b66ecaf4dfb6a99abec523db695b4f'

14. Consensus?
● In a decentralized system how do we come to “a general agreement.” on
who can participate?
● There are two mainly used algorithms
○ Proof-of-work.
○ Proof-of-stake.

15. Blockchain Network
● The operation of a blockchain
network, relies on the following.
a. New records are broadcasted to all nodes.
b. Each node collects records to a new block.
c. Each node finds a proof-of-work and
broadcasts to the whole network.
d. Nodes accept if the block is valid.
e. Nodes accept the block by mining the next
block using the hash of the accepted block.
N N N
N
N
N N N
N
N

16. Smart Contracts
● “Smart Contracts” was coined by Nick Szabo, legal scholar and
cryptographer in 1994.
● Smart contract is a set of computer codes between two or more parties
that consist a defined rules if met produces and output.
● Properties of smart contracts.
○ Self-verifiable
○ Self-executable
○ Tamper Proof

17. Types Of Blockchains
● 🌍Public blockchain
○ Anyone is allowed to partake in the network.
○ Allows operation on any capacity/functionality.
○ IE- public cryptocurrency like bitcoin.
● 🔐Permissioned Blockchain
○ Requires invited access to take part.
○ Roles can be introduced, such as read only, etc.
○ Faster as minimum number of nodes.

18. Distributed database of records
stored in immutable blocks
connected with prior blocks
forming a chain; for which the
validity is affirmed by peers of a
decentralized network secured
by cryptography.
Photo by Tobias Fischer on Unsplash

19. Applications.

20. Characteristics Of a successful
Blockchain Applications
● Reduces economic cost.
● Bridges the physical and
digital world.
● Involves collaboration of
multiple entities.
Photo by Austin Schmid on Unsplash

21. Digital Identity / Self-sovereign identity
● Self-sovereign identity rides on the concept that digital identities are
managed independently without a trust anchor.
● Modern day self-sovereign identity, try to accomplish
○ Existence - self controlled identities.
○ Transparency - Algorithms and functionalities is not hidden.
○ Consent - Ability to give consent for other parties.
○ Interoperability - Ability to be used across wide domains.
○ Portability - Data should be transferable and self contained.
http://www.lifewithalacrity.com/2016/04/the-path-to-self-soverereign-identity.html

22. Financial Domain
● Not just limited to cryptocurrency.
● With Smart-Contracts opens doors for new applications to emerge from
blockchain.
○ Asset Management - Trading and settling.
○ Cross border payments - Ability to trade over borders without middle men.

23. Peer to Peer Applications
● Peer to peer financing.
○ Transparent records of each actor on the chain.
○ KYC, credit reports can be verified and added to the chain.
● Ride sharing / room renting with no middle man.
○ Elimination of middlemen and service charges.

24. Applications.
Permissioned

25. Transparency With Permissioned Blockchain
● Following shows a permissioned blockchain integrated with a
traditional architecture for transparency.
TE
N
N
N
N
👨‍👩‍👧
Read/Write Read Only
👨‍👩‍👧
Organization boundary

26. Integration with Permissioned Blockchains
● Following shows a permissioned blockchain shared with two
organizations for an integration scenario.
TE
N
N
👨‍👩‍👧
Organization X
TE
N
N
👨‍👩‍👧
Organization Y
Integration boundary

27. Hyperledger - Blockchain Implementation
● Fostered by Linux Software Foundation.
● Provides Open Source technologies for blockchain.

28. Regulations Vs Blockchain
● With regulations such as
“data minimization” and
“rights to erasure”
immutability of the
blockchain is an issue.
Photo by Sara Kurfeß on Unsplash

29. Takeaway points.

30. Takeaways from the presentation.
● Blockchains distributes trust and decentralizes data.
● Permissioned blockchains allow immutability and distributed nature to
different use cases.
● Regulatory compliance is important, use of internal block chains or
hash blockchains can be used.
● Blockchain implementations are abundant, use projects such as
Hyperledger.

31. Useful Links/Contact
Tweet me @enigmamaker
Web: kaveenrodrigo.com
Email: u.k.k.rodrigo@gmail.com
https://bitcoin.org/bitcoin.pdf
http://www.lifewithalacrity.com/2016/04/the-path-to-self-soverereign-identity.html
https://www.hyperledger.org/projects