The Blockchain. Josh Vorick

Transcription

1 The Blockchain Josh Vorick

2 Bitcoin is a currency. Blockchain is a technology.

3 What is a blockchain? A decentralized database that anyone can add to and no one can delete from

4 The Bitcoin blockchain

5 Agenda Why You Should Care Bitcoin Transactions Mining Mining Pools Scalability Other blockchain applications

6 Why you should care

7 Many are comparing the blockchain to TCP/IP

8 $1 Billion invested into blockchain-related startups

9

10

11 $110,000 median blockchain engineer starting salary

12 In case money isn t enough... Trustless, decentralized networks Remove third parties Smaller fees Don t need to trust a central authority Corruption-proof (e.g. Bitcoin is a safe haven from bank crisis) Privacy Completely Digital Trustless Removes Third Parties

13 time to get technical

14 The Bitcoin blockchain

15 Digital Signatures Public key (verification key) Secret key (signing key) Sign a message with your secret key Verify that a signature is valid using their public key

16 Cryptographic Hash Deterministically maps an input string to a fixed length output Output looks like a random number Collision resistant HASH 6d324eff6c3f40c14c24642f 82272e8b16bc158a67a6e6 4e8c511e534dbb7c8d

17 a0cd8d94408af12bc1bdb677ca47d86b049c448e b5015c396a56827ea70fe8d2bf473ea9be8 265a6b39e9d1e3e0581db2b25a4cc061a6de9ff44 b30a314400b44ebad3d1af844cdb40b58bcf bf eaa0f65b4a780c b7a8eced52f936e2b106e c351415b8f525 f994077ca002460cc3b6f9e f9cbe8cd644 1dc891fe4daf5a7ce22bb0e7c04e3253ff e3967e7dca f e33ad1b831aaae1 ca1ec6c31639dd54691c4987ede6c3228bf453c01 dc1a1f67242d601473c2f533f6b30a31440c3b6f9e ca5cfc1a c87410c2039dce459f67138 c8a23b8d19aad4d3c037c23b 5feceb66ffc86f38d952786c6d696c79c2dbc239dd 4e91b46729d73a27fb57e9 0a13032d6e91709e88effb654657fcb620432caa2 dc1f37db32871eb5e3a2aa7 57bb432fbc63aa7588e8a66329e4534b6567fd2f4f 26f91caa5f9b01396d4f98

18 (non-cryptographic) def myhash(str): = 5831 for c in str: = * 33 + int(c) return cryptographic (blake2b)

19 Transactions are complicated

20 What s in a Transaction? the super duper basics Sender Recipient Amount Signature

21 txn1 Alice -> Bob 25 Btc -Alice

22 What s Really in a Transaction? Sender Recipient Amount the super basics List of inputs List of outputs SUM(in) = SUM(out) Signature

23 txn1 Alice -> Carol 15 Btc (see txnx) -Alice txn3 Carol -> Dave 25 Btc (txn1+txn2) -Carol txn2 Bob -> Carol 10 Btc (see txny) -Bob

24 txn1 15 Btc to Carol see txnx -Alice txn3 25 Btc to Dave see txn1, txn2 -Carol txn2 10 Btc to Carol see txny -Bob

25 txn1 15 Btc to Carol see txnx -Alice txn3 20 Btc to Dave 5 Btc to Carol txn2 10 Btc to Carol see txny -Bob see txn1, txn2 -Carol

26 What s Really Really in a Transaction? Sender Recipient s public key Amount the basics List of inputs List of outputs SUM(in) = SUM(out) + Miner fee Sender s signature

27 txn1 15 Btc to pkc see txnx sign(txn1, ska) txn3 20 Btc to pkd Btc to pkc see txn1, txn2 txn2 10 Btc to pkc see txny sign(txn2, skb) sign(txn3, skc)

28 txn1 15 Btc to pkc see txnx sign(txn1, ska) txn3 20 Btc to pkd Btc to pkc see txn1, txn2 txn2 10 Btc to pkc see txny sign(txn2, skb) sign(txn3, skc)

29 What s Really Really Really in a Transaction? Sender Recipient s public key Amount Script List of inputs List of outputs SUM(in) = SUM(out) + Miner fee Multisig Locktime Puzzles etc Sender s signature

30 Mining

31 Miners Get sent transactions Compile them into blocks Add their blocks to the blockchain

32 If miners add blocks willy-nilly, the blockchain will quickly become inconsistent

33 Give the miners a hard puzzle Miners work on puzzle Whoever solves it shows the network their solution Their block gets added to the blockchain Puzzle is called proof of work

34 Proof of Work Used to prevent fraud DoS attacks Spam Blockchain! Make it computationally hard to do something e.g. You can t access my website unless you do work

35 Example challenge m = Challenge text n =??? target = 0x0ffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffff Find some n such that (m + n) < target

36 target = 0x0ffffffffffffffffffffffffffffffffffffffffffffffffffffffffffffff Challenge Text0 0xa34adb adfab8d08e6cbdb24029e1bb0a8d906d0 80d01842ce57ee9156 Challenge Text1 0xcc e95dae6279fdb241497f92e5f50093a35a5c7d c010f1f357d43ed6c Challenge Text2 0x669a60a2bcefaa27cad56b0d9754bbaf7cc596d2b d99e8b53e5f3bd Challenge Text3 0x85a38de18ed2a5246c778c4888b72ee62e6464e a55afd995dd Challenge Text4 0x67618f5b9a7f f96eab68c610f375f1a580f7d9bb9 9d628c8ee8ba21fa Challenge Text5 0x04f0d5919eccd435de1521c bf0e9113b129f2 f689d586596dbe4fc Lucky!!

37 Miner code!! Version 2 def mine(block, target): n=0 while true: h = (Block + n) if h < target: return n n++ def mine(block, target): n=0 b = (Block) while true: h = (b + n) if h < target: return n n++ Block up to 1MB => ing is SLOW

38 Now we only Block once, right? No :(

39 How can we do this faster?

40 Block

41 Block b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b13 b14 b15

42 Block b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b13 b14 b15

43 Block b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b13 b14 b15

44 Block b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b13 b14 b15

45 Merkle tree b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b15 b14 b13

46 Merkle tree b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b15 b14 b13

47 Merkle tree b0 b1 b2 b3 b4 b5 b6 b7 b8 b9 b10 b11 b12 b15 b14 b13

48 Sweet! Let s Mine!

49 1 ~720,000,000,000,000,000,000 Chance of solving a block on the first try

50 = Chance of being struck by lightning 1,977,098 times in one second

51 1 ~20,000,000,000 Chance of solving a block in 1 hour on a $300 CPU

52 1 ~100,000,000 Chance of solving a block in 1 hour on a $300 GPU

53 1 ~240,000 Chance of solving a block in 1 hour on a $370 ASIC

54 $1 per day (amortized)

55 Mining Pools

56 Use a Central Server to Run the Pool Mine blocks for the server Submit partial blocks to server e.g. when you almost beat the target Types slush Pay-per-Share Luke-Jr s

57 P2Pool Using a blockchain to create a mining pool Miners in the pool have their own side-blockchain Not used commonly due to network latency

58

59 14,695,844 PetaFLOPS Tianhe-2 operates at just PetaFLOPS

60 What if we replaced the with meaningful work?

61 Related Topics Decentralized Computing P versus NP? Homomorphic encryption Compute on encrypted data Still really slow

62 Scalability

63 230,000 transactions every day

64 Other Applications

65 All blockchains: Have transactions Have miners Use Merkle trees Have similar scalability issues (for now)

66 Trade custom assets Make bets Leverage Hedging

67 Turing complete block chain Smart Contracts Platform for other blockchain applications

68 Decentralized prediction market People bet on events outcomes Get precise forecasts on any event

69 Decentralized ebay Create your own store and sell to peers on the network No fees / restrictions

70 Proof of Existence Add the of a document to Bitcoin s block chain Enables to prove you had that document on that date

71 Add an ownership layer to the Internet Enable artists to know when/where their art is being used Allow users to easily pay commissions Enable for limited editions of digital art

72 Decentralized cloud storage Secure peer-to-peer file storage Rent out empty hard drive space

73

74 Bitcoin Club! Focus on blockchain technologies Learn more about how they work Discuss applications of the blockchain in greater detail Workshops Expos! Bitcoin Ethereum etc Get funding to go to expos Hackathons! Blockchain Madness

75 How do I join? Facebook Georgia Tech => Bitcoin Club Message Josh Vorick (me) Looking for Leadership Drafting a Constitution soon Let me know if you want to help!

76 Questions?