Unstructured Blockchain MIT Course By Prof. Gary Gensler

 FIAT currency

what are the key design features cryptography, networking, timestamp

Two main cryptographic algorithms:-communication and computation that need to by verified

Hash functions 

Digital Signatures

Zero-Knowledge proof

Double spending problem, 

You have a piece of information and you use it twice. In terms of money, double spending is a big problem

Money is a social contract. Money itself is a consensus that this paper that we call money will be accepted.

FIAT currency:- It has instability due to weak monitory policy. 

Ledgers:-Its a way to keep records, transaction records, and balance ledgers. Central banking is based on central ledgers. 

Satoshi Nakamoto doesn't use the word blockchain. Blocks are added in average 10 minutes. 

Ethereum adds blocks in 7 seconds.

The whole debate is about who gets the ability to change the data. 

Key features 

Hash Function, private and public keys (asymmetric cryptography), bitcoin addresses, miners, proof of work, the concept of nodes. How much information is stored? The Merkle tree structure. 

Merkle tree is to compress and retrieve data. Nonce

The nonce:-A random number that is used once. 

Bitcoin technical features:-

Timestamp

cryptographic hash functions

timestamped

block headers

asymmetric cryptography

address

consensus

when you mine and did a proof of work it means that you have created a native currency

Bitcoin creates a unit of an account of 17 million right now. Proof of work mining, 

80k to mine a block

Transaction input and output

Unspent transactions

how much electricity is consumed to get 80K dollars for a blockchain block? the probability of winning a block is it 15 zeros. There are so many hashes that are done. Mining pool and everybody shares the reward. 2 pools in china and 1 in Russia. 

Cryptography

communication in the presence of adversaries.

a hash function is a fingerprint for data

it takes input x

certain data sane hash and could be computed efficiently

51% attack. 

collision-resistant

Avalanche effect

it is not 100% immutable. quadrillion immutable it's highly unlikely to be broken. 

Merkle root hurdles use SHA 256

Satoshi Nakamoto use 

Block

Version

previous block hash

Merkle root hash:-transaction list at the bottom, there can be 100 transactions in a block, 

Full node

Light node:- wallet can be downloaded. Merkle root has all the transactions that are in the block

Every block has a difficult target

Nonce:-Number once, a random number that can only be used once. 

timespans:-its, not an important feature, it's not a precise information, if the block is  mined 

Timestamps are a really important difficult adjustment that happens every two weeks. 

Two miners solved the hash function it's not that they will have the same block

Merkle root binary data tree

Blockchain Lecture 4

Byzantine general problem, if somebody is not acting in a proper way as he/she is supposed to

miners using computer power, when somebody solves the problem it will propagate on the blockchain, and others will validate.

Lost resources can solve there could be very few who could validate. 

Consensus, proof of work

The native currency of blockchain is bitcoin. Consensus through proof of work. immutable means that it cannot be changed

any state actor want to fork if it is considerably less than the majority, 

Biocon technical features

1. Cryptography with hash Timestamped
2. Decentralized network consensus
3. transaction script and UTXO

Hash functions SHA:-One way data compression:-

One thing in the input data the hash would come differently.

The header in the block could be put into a hash, Merkle root is an efficient and secure way of storing information.

Digital Signatures with hashBitcoin are determined by a public key. 

Decentralized Networks:- You should not use the public key twice

Byzantine general problem

Permissionless blockchain, there is no central authority, 

Proof of work was proposed 11 or 12 years before the bitcoin Puzzle to be difficult to solve and easy to validate

How to do a chain of information and do proof of work

 

If we change one thing the hash will change completely. 

Blockchain consensus supports the longest blockchains other miners will build upon

purple blocks are stale blocks that were mined but nobody builds upon them. It happens from time to time on blockchain. Even if China or any other country walled off the internet and build upon their own blocks but if there is another fork that is longer than the Chinese blockchain, Chinese miners will stop using CPU and electricity power to mine. Therefore there is no point in biases.

Bitcoin china and bitcoin rest of the working blockchain. The reward is that every blockchain has a native currency bitcoin for bitcoin, ether for ether. If there is a shorter blockchain that means the value is 0? as is purple chain avoid? Yes, stale blocks are nothing. If the purple chain goes for thousands of blocks, there will be separate currencies. Anything on the purple chain will also be on the black block's pool. 

What are bitcoin and bitcoin cash? 

The monetary difference is 15:1 but it needs more discussion.

Proof of work has difficult functions. Satoshi Nakamoto did it every 10 minutes. Defined by the number of leading zeros. as shown in the image below

Bitcoin mining difficulty

Now the difficulty is shown as 1 trillion and its algorithmic scale so it's 7 trillion. So, currently, it is 7 trillion harder to find answers to the puzzle than it was in 2009. 

that's because a lot of computers that are finding hash. The Hash Rate is now 50 hex hash/person. Which is like 1000 trillion hashes. CPU power has also been extraordinarily increased.

Bitcoin Mining Evolution:-

16 terra hashes per second the most power hashing. The modern factory has thousands of ASICs. Is there an economic opportunity cost of mining? there is certainly a tradeoff, One of the debates is a good use of resources. All strong currencies have had something to limit the supply so we are doing it electronically we are not saying that this is efficient. Mining is to ensure it's harder to create the currency, it's good. Mining pools come to create pools it's hard to solve the riddle it's maybe 1 year one block or even 10 years a block so the mining pool concept raised. 

Its economics of mining come together. Mining pool operators. Services are compensated. It distributes the economics of miners.

Bitcoin adjusts mining difficult after two weeks. If a few people mining difficulty will be reduced for example leading zeros will be reduced. If more people mining leading zeros will be increased. 

Proof of stake:- Proof of stake is an alternative consensus mechanism, BTC has a 19% hash rate. 

If the total hash power is 60hexahash 19% of that. Most bitcoiners sell bitcoin the coins that are created are sold into the raw community. Very few miners hold bitcoins hold to their coins. They hold coins for a very lesser amount of time. They have the choice to keep it or sell it. What hinders all the mining pools come together and constraining supply and creating a 51% attack. However its an open system. 

Native currency:- it's an incentive system, monetary policy in essence limit the supply of the currency. Bitcoin is limited and coin-based transactions are in the block. 

Satoshi Nakamoto state monetary policy and bitcoin will cap in 2040

Fees in Ethereum is paid

Gas in satoshi,

Bitcoin is a deficient currency? I would say, those who are find hard currency, There is a need of human involvement because it's too hardcoded. 
Bitcoin is a real currency or just an aspect of currency? 

Network:-

Full nodes:- store the full blockchain and able to validate all transactions

Pruning nodes:- Prune transactions once they are validated (trims) so you don't need to take care or compute. The transactions that already happened are pruned

Lightweight Nodes:- If you have a wallet that is lightweight SPV. It stores the header

Miners:- Miners most of them are not operating full nodes 

Mempool:-store unconfirmed yet validated transactions

 FIAT currency

what are they key design features cryptography, networking, timestamp

 

Two main cryptographic algorithms:-communication and computation that need to by verified

Hash functions 

Digital Signatures

Zero Knowledge proof

Double spending problem, 

You have a piece of information and you use it twice. In terms of money, double spending is a big problem

 

Money is a social contract. Money itself is a consensus that this paper that we call money will be accepted.

FIAT currency:- It has instability due to weak monitory policy. 

Ledgers:-Its a way to keep records, transaction records and balance ledgers. Central banking is based on central ledgers. 

Satoshi nakamoti doesn't use the word blockchain. Blocks are added in average 10 minutes. 

Ethereum adds blocks in 7 seconds.

THe whole debate is who gets the ability to change the data. 

Key features 

Hash Function, private and public keys (asymmetric cryptography), bitcon addresses, miners, proof of work, concept of nodes. How much information that is stored. The merkle tree structure. 

Merkle tree is to compress and retrieve data. Nonce

Nonce:-A random number that is used for once. 

 

Bitcoin technical features:-

Timestamp

cryptographic hash functions

timestamped

block headers

asymmetric cryptography

address

consensus

when you mine and did a proof of work it means that you have created a native currency

Bitcoin creates a unit of a account 17 million right now. Proof of work mining, 

80k to mine a block

Transaction input and output

Unspend transactions

how much electricity is consumed to get 80K dollars for a blockchain bloc. the probability of winning a block is it 15 zeros. There are so many hashes are done. Mining pool and everybody shares the reward. 2 pools in china and 1 in russia. 

Cryptography

communication in the presence of adversaries.

hash function is a finger print for data

it takes input x

certaub data sane hash and could be computed efficiently

 

51% attack. 

collision resistant

Avalanche effect

it is not 100% immutable. quadrillion immutable its highly unlikely to be broken. 

Merkle root herdles use SHA 256

satoshi nakamoti use 

 

Block

Version

previous block hash

merkle root hash:-transaction list at the bottom, there can be 100 transactions in a block, 

 

Full node

Lishgt node:- wallent can be download. merkle root has all the transactions that are in the block

Every block has a difficult target

Nonce:-Number once, random number that can only be used once. 

timespans:-its not important feature, its not a precise information, if the block is  mined 

Timestamps are really importantdifficult adjustment happens every two weeks. 

Two miners solved hash function its not that they will have the same block

Merkle root binary data tree

 

merkle root changes if some of the data in the 10k transactions change. merkle root will be different depending on who wins

order of transactions should memory pool 

hash functions compress data

slice sings the public key and sends it symmetric key both people has the key. Asymmetric public and private key are bonded together

generate key pair public and private key is generated at the same time infeasible to find a private key using a public ke

Bitcoin addresses