DIGITALNOTES ON BLOCK CHAIN TECHNOLOGY (R20A0522) B.TECH IV Year—-I Sem (2023-24) DEPARTMENT OF COMPUTER SCIENCE AND ENGINEERING MALLA REDDY COLLEGE OF ENGINEERING &TECHNOLOGY (Autonomous Institution - UGC, Govt. of India) Sponsored by CMR Educational Society (Ate NTU,Hyabod, Aprovedby AICTE Acie y NBA NAAC-‘A'Gra$80900 2008Cifed) Maisammaguds,Dhulaally(PostViaiakimpt), Seeunderabad-500100, TelanganaStat, India, ‘Contact Number0#0-78792 4664634237, E-Mail ID:mrcet2004@mailcom, website: www.mece.a.inALLA REDDY COLLEGE OF ENGINE! iG & TECHNOLOGY (R20A0522) BLOCKCHAINTECHNOLOGY IV Year B.Tech. C Sem Lo TPC COURSEOBJECTIVES: This course will enable the students: 1, To enable the student to understand and appreciate, the importance of fimdamentals of blockchain technology and application of cryptography in blockchain 2. To gain the awareness about the concepts of various implementations of blockchain technology such as bitcoin, Ethereum, and Hyper ledger UNIT-I Introduction to Blockchain Technology — Distributed systems — The history of blockchain — Introduction to blockchain — CAP theorem and blockchain — Benefits and limitations of blockchain — Decentralization using blockchain - Methods of decentralization — Routes to decentralization UNIT-I Cryptography in Blockchain: Introduction - cryptographic primitives — Assymetric cryptography — public and private keys -line interface — Bitcoin improvement proposals (BIPs) — ConsensusAlgorithms. UNIT-IIT BitCoin Introduction — Transactions — Structure - Transactions types — The structure of a block— The genesis block — The bitcoin network— Wallets and its types- Bitcoin payments- Bitcoin investment and buying and selling bitcoins — Bitcoin installation — Bitcoin programming and the command-line interface — Bitcoin improvement proposals (BIPs). UNIT-IV Ethereum - Ethereum block chain- Elements of the Ethereum block chain~ Precompiled contracts — Accounts and its types — Block header- Ether ~ Messages - Mining - Clients and wallets — Trading and investment — The yellow paper - The Ethereum network - Applications developed on Ethereum - Scalability and security issues UNIT-V Smart Contract and Hyper ledger — History of Smart Contract — Ricardian contracts - The DAO. Hyper ledger projects — Hyperledger as a protocol — Fabric - Hyperledger Fabric - Sawtoothlake — Corda Architecture,TEXTBOOKS: \.Bashir, Mastering Blockchain: explained, 2nd Edition, 2nd Revised edition edition. Birmingham: Packt Pul stributed ledger technology, decentralization, and smart contracts ishing, 2018. REFERENCEBOOKS: 1. A. M. Antonopoulos, Mastering bitcoin, First edition. Sebastopol CA: O'Reilly,2015. 2. Z. Zheng, S. Xie, H. Dai, X. Chen, andH. Wang, —An OverviewofBlockchain Technology: Architecture, Consensus, and Future Trends! in 2017 IEEE International Congress on Big Data (BigData Congress), 2017, pp.557-564. Outcomes: + Student will be able to to understand the fundamentals of blockchaintechnology. + Apply knowledge of implementations of Bitcoin, Ethereum and Hyperledger to develop solutions in the appropriate domains,MALLA REDDY COLLEGE OF ENGINEERING & TECHNOLOGY DEPARTMENT OF COMPUTER SCIENCE AND ENGINEERING INDEX Unit Contents Pg.No Introduction to Blockchain Technology T Distributed systems 2 The history of blockchain 9 ‘CAP theorem and blockehain 1 Benefits and limitations of blockehain 2 Decentralization using blockchain 14 Methods of decentralization 7 Routes to decentralization 20 Cryptography in Blockchain 26 TIntroduction— eryptographic primitives 2 11 | Assymettic eryptography 29 Public and private keys -line interface 31 Bitcoin improvement proposals (BIPS) 3 ‘ConsensusATgorithms 34 Introduction to BitCoin 38 “Transactions and Structure 40 I "Transactions types 41 The structure of block a The bitcoin network— Wallets and its types % Bitcoin payments_Bitcoin investment and buyingand selling | 51 Bitcoins Bitcoin installation: Bitcoin programming and the command- | 52 fine interface Biteoin improvement proposals (BIPS). 7 Ethereum & Elements of the Fthereum block chain 38 Precompiled contracts 0 I [Recounts andits types 61 Block header @ Either ~ Messages 4 “Mining - Clients and wallets oF‘Trading and investment — The yellow paper 70 The Ethereum network - Applications developed on 7I Ethereum Scalability and security issues 2 Smart Contract & History of Smart Contract 74 Ricardian contracts -The DAO B V__ [Tiyper ledger projects —Ilyperledger asa protocol 76 Fabric - Hyperledger Fabric 7 Sawtooth lake — CordaArchitecture. aBLOCK CHAIN TECHNOLOGY AY:2023-24 Blockchain is a buzzword in today’s technology and this technology is described as the most disruptive technology of the decade. Thus, Blockchain is used for the secure transference of items like money, contracts, property rights, stocks, and even networks without any requirement of Third Party Intermediaries like Governments, banks, ete. Once the data is stored in the Blockchain it becomes very difficult to manipulate the stored data. A Blockchain is a Network Protocol like SMTP. However, Blockchain cannot be run without the Internet. BlockChain is usefull in many areas like Banking, Finance, Healthcare, Insurance, ete. A blockchain is an open, distributed ledger that can record transactions between two patties efficiently and in a verifiable and permanent waywithout the need for a central authority. Key Characteristics: ‘Open: Anyone can access blockehain. Distributed or Decentralised: Not under the control ofany single authority. Efficient: Fast and Scalable. Verifiable: Everyone can check the validity of information because each node maintains a copyofthe transactions. Permanent: Once atransaction is done, itis persistent and can’t be alter Blockchain can be defined as the Chain of Blocks that contain some specific Information, Thus, a Blockchain is a ledger ie file that constantly grows and keeps the record of all transactions permanently, This process takes place in a secure, chronological (Chronological means every transaction happens after the previous one) and immutable way. Each time when a block is completed in storing information, a new block is generated. DEPARTMENT OF CSE, Page 1BLOCK CHAIN TECHNOLOGY AY:2023-24 Distributed Systems: Understanding distributed systems is essential to our understanding blockchain, as blockchain was a distributed system at its core, It is a distributed ledger that can be centralized or decentralized, A blockchain is originally intended to be and is usually used as a decentralized platform. It can be thought of as a system that has properties ofthe both decentralized and distributed paradigms. It is a decentralized-distributed system. Distributed systems are a computing paradigm whereby two or more nodes work with each other in a coordinated fashion to achieve a common outcome. It is modeled in such a way that end users see it as a single logical platform. For example, Google's search engine is based on a large distributed system; however, to a user, it looks like a single, coherent platform. A node can be defined as an individual player in a distributed system. All nodes are capable of sending and receiving messages to and from each other. There is no Central Server or System which keeps the data of Blockchain. The data is distributed over Millions of Computers around the world which are connected with the Blockchain. This system allows Notarization of Data as it is present on every Node and is publicly verifiable.A node can be defined as an individual player in a distributed system. All nodes are capable of sending and receiving messages to and fromeach other. Nodes c: arbitrary behavior is also known as a Byzantine node. This arbitrary behavior can be intentionally malicious, be honest, faulty, or malicious and have their own memory and processor. A node that can exhibit which is detrimental to the operation of the network. Generally, any unexpected behavior of a node on the network can be categorized as Byzantine. This term arbitrarily encompasses any behavior that is unexpected or malicious. ‘The main challenge in distributed system design is coordination between nodes and fault tolerance. Even if some of the nodes become faulty or network links break, the distributed system should tolerate this and should continue to work flawlessly in order to achieve the desired result, This has been an area of active research for many years and several algorithms and mechanisms has been proposed to overcome these issues. DEPARTMENT OF CSE, Page 2