Blockchain Notes -Kenny Hisano

The benefit of implementing blockchain.

hash cash — the origin of PoW

PoW

  1. hash -> will it stat from 00000? NO-> repeat infinite ->found. this is a rare diamond like object since hash which starts with 00000 is super rare. any tiny modification will crash the diamond. -> distributed computer power goes to calculate to find this.

Mining Question

Double Spending

bitcoin mining priority

why proof of work is secure?

How does that ensure security and integrity?

Imagine that you wanted to go back and change something in a transaction or a document registered on the blockchain a few blocks ago. As I explained above, if you change so much as a comma, the entire hash changes. And since that hash forms part of the next hash, that would change too. And so on. You would effectively have to re-mine every subsequent block. If one is difficult and expensive, how difficult and expensive would it be to successfully get several re-mined? Prohibitively so. Proof of Work helps maintain bitcoin transactions’ integrity.

It can also prevent double-spending attacks. Let’s say that you send bitcoins to one person. The person that you sent the coins to in the first transactions sees that you did that, and releases or sends the goods you wanted to purchase. A second later, you send the same bitcoins to another address that you own. Given bitcoin’s latency (it can take a few seconds for transactions to spread around the nodes, and your second one may arrive at some nodes before your first one), it’s possible that your second transaction gets processed and validated first. Your first transaction is invalid. Are you going to send back the goods? This is why, if you are a merchant accepting bitcoin, it is recommend able to wait for a few blocks to pile on top of the one that sends you the bitcoins, to make sure that yours is the one that got processed, not the “nice try!” fraudulent attempt by the sender.

Blockchain Longest Chain Rule

What is Bitcoin transaction escrow ?

https://www.quora.com/How-does-bitcoin-escrow-work

Double spending:

  1. Fred -> Alice : 5.0BTC : Complete: Alice’s money Total = 5.0 BTC

2. Alice -> Bob : 5.0BTC : Still in process: Alice’s money Total = 5.0BTC still in process

3. Alice -> Alice : Same 5.oBTC sent to Bob :

If process 2 gets invalid since 3 is completed faster, Alice -> Bob gets invalid. 5.o Back to Alice. but Alice gets 5.0 by process 3. so gets 10BTC

Double Spending!

Why bitcoin comfirmation takes 10 min??