Blockchain is a decentralized ledger technology consisting of linked blocks containing transactions, which enhances transparency and prevents fraud. It features transaction processing, immutable ledgers, and various consensus mechanisms like proof of work and proof of stake. Notable examples include Bitcoin, Ethereum, and Hyperledger.

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Blockchain Training
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Blockchain
Lesson 02

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What's Blockchain?
Is a data structure used to create a decentralized ledger.
Is composed of blocks in a serialized manner. A block contains a set of
transactions, a hash of the previous block, timestamp, block reward, block number,
and so on.
Every block contains a hash of the previous block, thus creating a chain of block
linked with each other.
Every node on the network contains a copy of the blockchain.

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What's Blockchain?
The major advantage of blockchain data structure is that it automates auditing and
makes an application transparent yet secure. It can prevent fraud and corruption. It
can be used to solve many other problems depending on how you implement and
use it.

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Decentralized Ledger
Transaction Block Blockchain

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Blockchain Data Structures
● Transaction: the most basic unit of execution, it results in calling a function
like transfer to deduct funds from one account to add them to another.
● Ledger: a list of new transactions to be added, existing transactions cannot
be modified or deleted.
● Block: a ledger with added meta-data such as a timestamp, a merkle tree
root that is summary of the ledger for quick verifications, the hash value of the
previous block and the hash value of this new block being added.
● Blockchain: the particular implementation of a decentralized ledger for a
specific purpose. Bitcoin is a blockchain for currency transactions that
enables global, secure and fast transfer of value.

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Block Structure

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Consensus
Logical system where every individual produces a good or service he specializes in
and exchange it for another good.
However this had some problems:
● No common unit of value
● Goods are perishable
● Transportation of goods wasn't efficient
● Not secure

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Proof of Work
Solve extremely difficult cryptographic
problems, competition of computer
processing power.
Proof of Stake
No mining, a limited number of tokens are
created at genesis and validators put their
coins at stake for chances of creating the
next block and earning its transaction fees.
Proof of Burn
Miners should show proof that they burned
some coins. This is expensive from their
individual point of view, just like proof of
work; but it consumes no resources other
than the burned underlying asset.
Byzantine Fault
Tolerance
Money must be able to be reliably saved,
stored, and retrieved

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Mining - Proof of Work
Race to find the solution to a cryptography problem. Winner gets a reward of newly
created “coins”.
However this had some problems:
● Intense computational calculations.
● Computer resources: CPU, GPU, Storage.
● Electric power hungry - renewable
● Not secure

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Blockchain examples
Here are some of the most common blockchain implementations as of Q1 2018:
● Bitcoin
● IPFS
● Ethereum
● HyperLedger
● FileCoin
● Dash
● BigchainDB
● Ripple