Community Meeting Notes (Jan 10, 2018) - Blockchain to Design

Description

Presenters: Edward Buchi

Participants will learn to create their own addresses.This workshop will introduce the concept of Blockchains to answer two simple questions: what is it, how is it relevant to Design?

Resources

• Slides (, )

• Video Recording

Notes

A broad subject, but Edward has narrowed it down to a few core subjects for our benefit.

Blockchain:

• Bitcoin the first Blockchain

  • 03/Jan/2009 - First time Bitcoin started.

  • Response to how people in the financial industry mismanaged wealth.

  • Typical attributes of currency:

    • scarce

    • durable

    • divisible

    • portable

    • verifiable

    • fungible

  • Added attributes of cryptocurrency:

    • inimitable - cannot be duplicated

    • decentralised - there is no single institution or country controlling the currency

    • digital

  • Cryptocurrency Value = Belief in the utility of the Blockchain network; will automate a lot of what banks do
    
    

• What are blockchains?

  • Are the memory of the Internet.

  • Made of computers, instead of neurons, spread out all over the world.

  • Gives Internet access to data to access critical functions.

  • Does not need to go to the bank; can safely send records to specialists without that data being falsified.

  • Gives the Internet access to data in order to execute critical functions and not rely on external sources of information.

  • Bitcoin - databases owned by banks.

  • A blockchain network is a type of distributed network. It also refers to the structure data is stored in.
    
    

• How Blockchains work (simplified technical explanation)

  • A user needs two basic things:

    • A private key and a public key

      • A private key is like a password

      • A public key (aka address) is like a phone number

      • if you lose the private and public key, you'll lose access to your blockchain. 

        • It is difficult to hack, so unlikely able to retrieve the data (e.g. this is how people have lost their bitcoin)

  • Basics components of a block

    • Example: bitcoin blockchain

    • A Hash is a condensed form of a digital file of anything

    • A function that, when data is run through it, will produce an identical (and often unique) result for the same given input

    • Merkle Tree, Merkle Root Hash

    • Component 1: Transaction Hash + Component 2: Previous Block Hash + Compotnent 3: Random number = Block Hash #

    • Change one block it would change the history of the rest of the Blockchain, because it would affect all hashes down the line.

    • Data security is maintained by having a copy of the blockchain

    • If a node would have a faulty copy of the blockchain, the other nodes (the network) would just ignore it

  • Who gets to be a node and what is the incentive?

    • anyone can be a node

    • the more computers there are the harder it is to come up with the NONCE

      • the NONCE is a method to build new blocks

      • only one node has the right to write the next block

        • the first node to "guess" the NONCE, gets to write the next block

        • Mining is volunteering for the network for the intention of winning the reward (NONCE – a hash result).

    • in terms of bitcoin, the node that writes the next block receives 12 bitcoins.
      
      

• Implications in the world at large