Blockchain and Bitcoin
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Blockchain has the potential to revolutionize financial and cyber security. It provides an incorruptible digital ledger that can record transactions of value in a way that is verifiable and accessible to anyone. Blockchain uses a distributed network of nodes that jointly manage a database without a central authority. Information on the blockchain is stored across this network through a linked chain of blocks secured by cryptography. The first blockchain was developed for the cryptocurrency Bitcoin in 2009. Blockchain offers benefits like speed, low costs, decentralization, secure payments, and transparency. It could enhance concepts like globalism, security, and democracy through applications on a transparent, secure global platform.
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Blockchain and Bitcoin
- 1. Blockchain Future Of Financial and Cyber Security
- 2. Introduction
- 4. “ “The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value.” 4
- 5. 5 • Example of a ledger
- 6. Blockchain Design 6 • A blockchain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography • Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data • By design, blockchains are inherently resistant to modification of the data
- 7. Origin of Blockchain 7 ● The blockchain is an undeniably ingenious invention – the brainchild of a person or group of people known by the pseudonym, Satoshi Nakamoto. ● But since then, it has evolved into something greater.
- 8. ● The first block #0 created in 2009 is referred as Genesis block in Blockchain. ● It is common ancestral parent of all the new blocks created and if traversed backward in time we will reach genesis block in the end. Genesis Block 8
- 10. ● Information held on a blockchain exists as a shared — and continually reconciled — database. ● The blockchain database isn’t stored in any single location, meaning the records it keeps are truly public and easily verifiable. ● No centralized version of this information exists for a hacker to corrupt. ● Hosted by millions of computers simultaneously, its data is accessible to anyone on the internet. A Distributed Database 10
- 11. ● A network of so-called computing “nodes” make up the blockchain. ● Node gets a copy of the blockchain, which gets downloaded automatically upon joining the blockchain network. A Network Of Nodes 11
- 12. ● Decentralization means the network operates on a user-to-user (or peer-to- peer) basis. ● A global network of computers uses blockchain technology to jointly manage the database that records Bitcoin transactions. ● That is, Bitcoin is managed by its network, and not any one central authority. The Idea of Decentralization 12
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- 16. BITCOIN 3
- 17. ● Bitcoin was the first cryptocoin currency ever invented. ● Bitcoin is digital currency released as an open-source software in 2009. ● It is a decentralized cryptocurrency produced by all the participating nodes in the system at a defined rate. ● The chain of Bitcoins created over period and linked to each other called Blockchain. What is Bitcoin ? 17
- 18. ● When a new block of transactions is created, it gets added to the Blockchain. ● The new transaction records are continuously added to Bitcoin's public ledger and this process is called Bitcoin mining. Bitcoin Mining 18
- 19. Fast & Cheaper The transactions made using Bitcoin’s wallets are fast and transaction fees are minimal. . Benefits of Bitcoin 19 a
- 20. Decentralized Registry Bitcoin currency is decentralized and no central authority has full control and hence central government or banks can’t take it away from you and there is no chargeback. The Central Bank during financial crisis in Cyprus wanted to take back all uninsured deposits more than $100,000 in 2013 to help recapitalize itself. But this is not possible with Bitcoins since currency is decentralized. Benefits of Bitcoin 20 b
- 21. Secure Payment Information Bitcoin transactions uses a public key and a private key. When a bitcoin is sent, the transaction is signed by public and private keys together which creates a certificate. . Benefits of Bitcoin 21 c
- 22. Bitcoin Mining You can create your own money by setting up a Bitcoin Miner. Benefits of Bitcoin 22 d
- 23. It's completely transparent . Benefits of Bitcoin 23 e
- 24. Conclusion 4
- 25. The progression of Bitcoin and the blockchain would revamp and enhance the following concepts: ● Globalism - Bitcoin and the blockchain address globalism with mobile applications and exchange platforms that facilitate financial and economic activities worldwide. ● Security - The blockchain technology addresses security in areas including insurance, law, and data security by validation of the information in the blockchain ledger. . 25
- 26. ● Democracy - Bitcoin and the blockchain address democracy by reshaping the functions of governments, organizations, and corporations with commercial influence in addition to the blockchain's ability to make voting systems more effective. 26
Editor's Notes
- Blockchain formation. The main chain (black) consists of the longest series of blocks from the genesis block (green) to the current block. Orphan blocks (purple) exist outside of the main chain.
- Satoshi Nakamoto is the name used by the unknown person or people who designed bitcoin and created its original reference implementation. As part of the implementation, they also devised the first blockchain database. In the software development process, a reference implementation (or, less frequently, sample implementation or model implementation) is the standard from which all other implementations and corresponding customizations are derived. An improvement to a reference implementation reflects an unchanging specification. While we may not know who he (or she) was, we know what he did. Satoshi Nakamoto was the inventor of the bitcoin protocol, publishing a paper via the Cryptography Mailing List in November 2008.
- Information held on a blockchain exists as a shared — and continually reconciled — database. This is a way of using the network that has obvious benefits. The blockchain database isn’t stored in any single location, meaning the records it keeps are truly public and easily verifiable. No centralized version of this information exists for a hacker to corrupt. Hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.
- Node (computer connected to the blockchain network using a client that performs the task of validating and relaying transactions) gets a copy of the blockchain, which gets downloaded automatically upon joining the blockchain network. Together they create a powerful second-level network, a wholly different vision for how the internet can function. Every node is an “administrator” of the blockchain, and joins the network voluntarily (in this sense, the network is decentralized). However, each one has an incentive for participating in the network: the chance of winning Bitcoins. Nodes are said to be “mining” Bitcoin, but the term is something of a misnomer. In fact, each one is competing to win Bitcoins by solving computational puzzles. Bitcoin was the raison d’etre of the blockchain as it was originally conceived. It’s now recognized to be only the first of many potential applications of the technology. There are an estimated 700 Bitcoin-like cryptocurrencies (exchangeable value tokens) already available. As well, a range of other potential adaptations of the original blockchain concept are currently active, or in development.
- The Blockchain & Enhanced security By storing data across its network, the blockchain eliminates the risks that come with data being held centrally. Its network lacks centralized points of vulnerability that computer hackers can exploit. Today’s internet has security problems that are familiar to everyone. We all rely on the “username/password” system to protect our identity and assets online. Blockchain security methods use encryption technology. The basis for this are the so-called public and private “keys”. A “public key” (a long, randomly-generated string of numbers) is a users’ address on the blockchain. Bitcoins sent across the network gets recorded as belonging to that address. The “private key” is like a password that gives its owner access to their Bitcoin or other digital assets. Store your data on the blockchain and it is incorruptible. This is true, although protecting your digital assets will also require safeguarding of your private key by printing it out, creating what’s referred to as a paper wallet.
- Cryptocurrencies are just lines of computer code that hold monetary value. Those lines of code are created by electricity and high-performance computers. Cryptocurrency is also known as digital currency. Either way, it is a form of digital public money that is created by painstaking mathematical computations and policed by millions of computer users called 'miners'. Physically, there is nothing to hold. Governments have no control over the creation of cryptocurrencies, which is what initially made them so popular. It is encoded within bitcoin client software and can’t be tampered.
- https://www.coindesk.com/information/how-bitcoin-mining-works/ https://99bitcoins.com/bitcoin-mining-profitable-beginners-explanation/ Mining Bitcoin Costs More Energy Than What 159 Countries Consume in a Year