Alchemy - How-To Mine Digital Schilling? How-To Turn Digital Bits Into $$$ or €€€?

Transactions (Hyper) Ledger Book

From	To	Amount
Grossklockner (†)	Sepp	3798
Grossvenediger (†)	Franz	3666
Dachstein (†)	Sissi	2995
Wildspitze (†)	Maria	3768

Sissi	Eva	20
Sepp	Maria	17
Franz	Sissi	3
Sepp	Ferdl	100

Franz	Max	17
Maria	Adam	4

(†): Miner Transaction - New Schilling on the Market!

(Source: openblockchains/schilling)

Blockchain! Blockchain! Blockchain! Decentralize Payments. Decentralize Transactions. Decentralize Blockchains.

What’s Blockchain?

Distributed Database?
Hyper Ledger Book?
Consensus with Proof-of-Work or Proof-of-Stake?
Digital Fingerprints? Cryptographic Hashes?
Lottery? Central Bank?
Byzantine-Generals Solution?

Yes. Yes. Yes. Blockchain! Blockchain! Blockchain!

(Source: openblockchains/whatsblockchain)

The Proof of the Pudding is … The Bitcoin (BTC) Blockchain(s)

A Success Story on the Blockchain.

May 22, 2010 - World’s 1st Bitcoin Payment

A developer bought two pizzas using 10 000 Bitcoin (BTC) - a then-little-known digital (crypto)currency. Estimated worth about $40.

Triva Q: How much is one Bitcoin worth today? Q: How much are 10 000 Bitcoin worth today?

$20 Million Dollar Pizza Day - Celebrating the Birth of Bitcoin Alchemy - $$$

(Source: coinmarketcap.com/currencies/bitcoin)

Let’s Build Your Own Blockchain in JavaScript (From Zero / Scratch)

Crypto God? JavaScript Ninja / Rockstar?

Yes, you can.

Code, Code, Code - A Blockchain in JavaScript in 20 Lines! A Blockchain is a Data Structure

What’s Blockchain?

It’s a list (chain) of blocks linked and secured by digital fingerprints (also known as crypto hashes).

const SHA256 = require( "js-sha256" )     // for hash checksum digest function SHA256

class Block {

  constructor(index, data, previousHash) {
    this.index        = index
    this.timestamp    = new Date()
    this.data         = data
    this.previousHash = previousHash
    this.hash         = this.calcHash()
  }

  calcHash() {
    var sha = SHA256.create()
    sha.update( this.index.toString() +
                this.timestamp.toString() +
                this.data +
                this.previousHash )
    return sha.hex()
  }

(Source: openblockchains/awesome-blockchains/blockchain.js)

Yes, that’s it.

Code, Code, Code - A Blockchain in JavaScript in 20 Lines! A Blockchain is a Data Structure (Cont.)

Let’s add two helpers (first, next) for building (“mining”) blocks.

class Block {
  ...
  static first( data="Genesis" ) {    // create genesis (big bang! first) block
    // uses index zero (0) and arbitrary previousHash ("0")
    return new Block( 0, data, "0" )
  }

  static next( previous, data="Transaction Data..." ) {
    return new Block( previous.index+1, data, previous.hash )
  }
}

(Source: openblockchains/awesome-blockchains/blockchain.js)

Let’s get started - build a blockchain a block at a time!

b0 = Block.first( "Genesis" )
b1 = Block.next( b0, "Transaction Data..." )
b2 = Block.next( b1, "Transaction Data......" )
b3 = Block.next( b2, "More Transaction Data..." )

blockchain = [b0, b1, b2, b3]

console.log( blockchain )

Code, Code, Code - A Blockchain in JavaScript in 20 Lines! A Blockchain is a Data Structure (Cont.)

Wait, so a blockchain is just a linked list?

No. A linked list is only required to have a reference to the previous element, a block must have an identifier depending on the previous block’s identifier, meaning that you cannot replace a block without recomputing every single block that comes after. In this implementation that happens as the previous digest is input in the calc_hash method.

will log something like:

[ Block {
      index: 0,
      timestamp: 2017-09-18T08:25:54,
      data: 'Genesis',
      previousHash: '0',
      hash:         'c396de4c03ddb5275661982adc75ce5fc5905d2a2457d1266c74436c1f3c50f1' },
    Block {
      index: 1,
      timestamp: 2017-09-18T08:25:54,
      data: 'Transaction Data...',
      previousHash: 'c396de4c03ddb5275661982adc75ce5fc5905d2a2457d1266c74436c1f3c50f1',
      hash:         '493131e09c069645c82795c96e4715cea0f5558be514b5096d853a5b9899154a' },
    Block {
      index: 2,
      timestamp: 2017-09-18T08:25:54,
      data: 'Transaction Data......',
      previousHash: '493131e09c069645c82795c96e4715cea0f5558be514b5096d853a5b9899154a',
      hash:         '97aa3cb5052615d60ff8e6b41bef606562588c4874f011970ac2f218e2f0f4a8' },
    Block {
      index: 3,
      timestamp: 2017-09-18T08:25:54,
      data: 'More Transaction Data...',
      previousHash: '97aa3cb5052615d60ff8e6b41bef606562588c4874f011970ac2f218e2f0f4a8',
      hash:         'e10e020f832e46c2b60e1c3c0412bd370b2fde5f0f782c16eb87d0313ea0d3a3' } ]

What about Proof-of-Work? What about Consensus?

Making (Hash) Mining a Lottery - Find the Lucky Number

calcHash() {
  var sha = SHA256.create()
  sha.update( this.index.toString() +
              this.timestamp.toString() +
              this.data +
              this.previousHash )
  return sha.hex()
}

The computer (node) in the blockchain network that computes the next block with a valid hash wins the lottery?

For adding a block to the chain you get a reward! You get 25 Bitcoin! (†)

Bitcoin adds a block every ten minutes.

(†) The reward gets halfed. In Sep’17 you’ll get 12.5 Bitcoin.

What about Proof-of-Work? What about Consensus? (Cont.)

Random SHA256 hash #1: c396de4c03ddb5275661982adc75ce5fc5905d2a2457d1266c74436c1f3c50f1

Random SHA256 hash #2: 493131e09c069645c82795c96e4715cea0f5558be514b5096d853a5b9899154a

Triva Q: What’s SHA256?

(A) Still Hacking Anyway
(B) Secure Hash Algorithm
(C) Sweet Home Austria
(D) Super High Aperture

What about Proof-of-Work? What about Consensus? (Cont.)

A: SHA256 == Secure Hash Algorithms 256 Bits

Trivia: Designed by the National Security Agency (NSA) of the United States of America (USA).

Secure == Random e.g. Change one Letter and the Hash will Change Completely

Making (Hash) Mining a Lottery - Find the Lucky Number

Find a hash that starts with ten leading zeros e.g.

0000000000069645c82795c96e4715cea0f5558be514b5096d853a5b9899154a

Hard to compute! Easy to check / validate.

What about Proof-of-Work? What about Consensus? (Cont.)

Making (Hash) Mining a Lottery - Find the Lucky Number (Nonce)

computeHashWithProofOfWork( difficulty="00" ) {
    var nonce = 0
    while( true ) {
      var hash = this.calcHashWithNonce( nonce )
      if( hash.startsWith( difficulty ))
        return nonce, hash    // bingo! proof of work if hash starts with leading zeros (00)
      else
        nonce += 1            // keep trying (and trying and trying)
    }
}

calcHashWithNonce( nonce=0 ) {
    var sha = SHA256.create()
    sha.update( nonce.toString() +
                this.index.toString() +
                this.timestamp.toString() +
                this.data +
                this.previousHash )
    return sha.hex()
}

(Source: awesome-blockchains/blockchain_with_proof_of_work.js)

The World’s Worst Database - Bitcoin Blockchain Mining

Uses approximately the same amount of electricity as could power an average American household for a day per transaction
Supports 3 transactions / second across a global network with millions of CPUs/purpose-built ASICs
Takes over 10 minutes to “commit” a transaction
Doesn’t acknowledge accepted writes: requires you read your writes, but at any given time you may be on a blockchain fork, meaning your write might not actually make it into the “winning” fork of the blockchain (and no, just making it into the mempool doesn’t count). In other words: “blockchain technology” cannot by definition tell you if a given write is ever accepted/committed except by reading it out of the blockchain itself (and even then)
Can only be used as a transaction ledger denominated in a single currency, or to store/timestamp a maximum of 80 bytes per transaction

(Source: Tony Arcieri - On the dangers of a blockchain monoculture)

Tulip Mania Quiz - Win 100 Schilling on the Blockchain!

Q: Tulip Mania Bubble in Holland - What Year?

(A) 1561
(B) 1637
(C) 1753
(D) 1817

Q: What’s the Name of the Most Expensive Tulip?

(A) Admiral van Eijck
(B) Admiral of Admirals
(C) Semper Augustus
(C) Semper Cesarus

Tulips on the Blockchain! Adding Transactions

Learn by Example from the Real World (Anno 1637) - Buy! Sell! Hold! Enjoy the Beauty of Admiral of Admirals, Semper Augustus and More.

Transactions (Hyper) Ledger Book

From	To	What	Qty
Dutchgrown (†)	Vincent	Tulip Bloemendaal Sunset	10
Keukenhof (†)	Anne	Tulip Semper Augustus	7

Flowers (†)	Ruben	Tulip Admiral van Eijck	5
Vicent	Anne	Tulip Bloemendaal Sunset	3
Anne	Julia	Tulip Semper Augustus	1
Julia	Luuk	Tulip Semper Augustus	1

Bloom & Blossom (†)	Daisy	Tulip Admiral of Admirals	8
Vincent	Max	Tulip Bloemendaal Sunset	2
Anne	Martijn	Tulip Semper Augustus	2
Ruben	Julia	Tulip Admiral van Eijck	2

Teleflora (†)	Max	Tulip Red Impression	11
Anne	Naomi	Tulip Bloemendaal Sunset	1
Daisy	Vincent	Tulip Admiral of Admirals	3
Julia	Mina	Tulip Admiral van Eijck	1

Max	Isabel	Tulip Red Impression	2

(†): Grower Transaction - New Tulips on the Market!

(Source: openblockchains/tulips)

Tulips on the Blockchain! Adding Transactions (Cont.)

Quotes - Blockchains are the next Internets / Tulips

People who compare digital tokens to tulips are essentially saying digital tokens are a bubble backed by nothing but pure hype and speculation.

What they fail to understand is that tulips come from dirt, not a blockchain.

And as we all know, blockchain is possibly the best technological innovation since the internet. It will have a tremendous impact on global business and society in general. – TulipToken

Tulips on the Blockchain! Adding Transactions (Cont.)

let b0 = Block.first(
        { from: "Dutchgrown", to: "Vincent", what: "Tulip Bloemendaal Sunset", qty: 10 },
        { from: "Keukenhof",  to: "Anne",    what: "Tulip Semper Augustus",    qty: 7  } )

let b1 = Block.next( b0,
        { from: "Flowers", to: "Ruben", what: "Tulip Admiral van Eijck",  qty: 5 },
        { from: "Vicent",  to: "Anne",  what: "Tulip Bloemendaal Sunset", qty: 3 },
        { from: "Anne",    to: "Julia", what: "Tulip Semper Augustus",    qty: 1 },
        { from: "Julia",   to: "Luuk",  what: "Tulip Semper Augustus",    qty: 1 } )

let b2 = Block.next( b1,
        { from: "Bloom & Blossom", to: "Daisy",   what: "Tulip Admiral of Admirals", qty: 8 },
        { from: "Vincent",         to: "Max",     what: "Tulip Bloemendaal Sunset",  qty: 2 },
        { from: "Anne",            to: "Martijn", what: "Tulip Semper Augustus",     qty: 2 },
        { from: "Ruben",           to: "Julia",   what: "Tulip Admiral van Eijck",   qty: 2 } )
...

Tulips on the Blockchain! Adding Transactions (Cont.)

resulting in:

[ Block {
    index:     0,
    timestamp: 1637-09-25 17:39:21,
    data:
     [ { from: 'Dutchgrown', to: 'Vincent',  what: 'Tulip Bloemendaal Sunset', qty: 10 },
       { from: 'Keukenhof',  to: 'Anne',     what: 'Tulip Semper Augustus',    qty: 7 } ],
    previousHash: '0',
    hash:         '7cb2df9eee29ca77c99eb4591a25dcbdfa9609aff2bd3558d1a0fe22acd08a51' },
  Block {
    index:     1,
    timestamp: 1637-09-25 17:49:21,
    data:
     [ { from: 'Flowers',  to: 'Ruben',  what: 'Tulip Admiral van Eijck',   qty: 5 },
       { from: 'Vicent',   to: 'Anne',   what: 'Tulip Bloemendaal Sunset',  qty: 3 },
       { from: 'Anne',     to: 'Julia',  what: 'Tulip Semper Augustus',     qty: 1 },
       { from: 'Julia',    to: 'Luuk',   what: 'Tulip Semper Augustus',     qty: 1 } ],
    previousHash: '7cb2df9eee29ca77c99eb4591a25dcbdfa9609aff2bd3558d1a0fe22acd08a51',
    hash:         'a7464e98290039f467e7abf6699180205f5151e76b57a79b39f43acc39d75660' },
  Block {
    index:     2,
    timestamp: 1637-09-25 17:59:21,
    data:
     [ { from: 'Bloom & Blossom', to: 'Daisy',    what: 'Tulip Admiral of Admirals', qty: 8 },
       { from: 'Vincent',         to: 'Max',      what: 'Tulip Bloemendaal Sunset',  qty: 2 },
       { from: 'Anne',            to: 'Martijn',  what: 'Tulip Semper Augustus',     qty: 2 },
       { from: 'Ruben',           to: 'Julia',    what: 'Tulip Admiral van Eijck',   qty: 2 } ],
    previousHash: 'a7464e98290039f467e7abf6699180205f5151e76b57a79b39f43acc39d75660',
    hash:         'b7e4952f801651c1e14d61d77b869d18268b46c468923089f1da33e3959b56b9' },
  ...
]

What’s Blockchain Lite - JavaScript Edition?

blockchain-lite library / module (npm: blockchain-lite) - build your own blockchain with crypto hashes - revolutionize the world with blockchains, blockchains, blockchains one block at a time

Usage

Let’s get started. Build your own blockchain one block at a time. Example:

const Blocks = require( "blockchain-lite" )

// use basic block
let Block = Blocks.basic

let b0 = Block.first( 'Genesis' )
let b1 = Block.next( b0, 'Transaction Data...' )
let b2 = Block.next( b1, 'Transaction Data......' )
let b3 = Block.next( b2, 'More Transaction Data...' )

let blockchain = [b0, b1, b2, b3]

console.log( blockchain )

Case Study - Dutch Gulden on the Blockchain!

(Source: coinmarketcap.com/currencies/gulden)

Schilling! Schilling! on the Blockchain! Rock-Solid Alpine Dollar from Austria

Who’s in? Invest Now!

Learn more @ openblockchains/schilling

Bonus: Blockchain Articles

Reflections on the Blockchain by Rufus Pollock (Open Knowledge Foundation), July 2016 – The DAO: Code is not Law - and It’s Dangerous to Think So ++ The Internet changed the world - surely the Blockchain will too? ++ Gold-rush or Internet-rush? ++ Governance Matters in Bitcoin ++ The Myth of a Costless, Ownerless Network ++ Lessons from History

On the Dangers of a Blockchain Monoculture by Tony Arcieri, January 2016 – The Bitcoin blockchain: the world’s worst database ++ Next-generation protocols ++ Decentralized ledger protocols ++ Bitcoin-NG ++ Blockchain! Blockchain! Blockchain! ++ The great decentralized database in the sky

I Don’t Believe in Blockchain by Tim Bray, May 2017

Minimum Viable Blockchain by Ilya Grigorik, May 2014 – Securing transactions with triple-entry bookkeeping ++ Securing transactions with PKI ++ Balance = Σ(receipts) ++ Multi-party transfers & verification ++ Double-spending and distributed consensus - Requirements for a distributed consensus network; Protecting the network from Sybil attacks; Proof-of-work as a participation requirement ++ Building the minimum viable blockchain - Adding “blocks” & transaction fee incentives; Racing to claim the transaction fees; Resolving chain conflicts; Blocks are never final ++ Properties of the (minimum viable) blockchain

Blockchains by analogies and applications: How blockchain compares to Git, Raft, and other technologies. by Kieren James-Lubin, January 2016 – Blockchains are databases ++ Understanding transactions ++ Persistent, replicated databases (related technology: Git) ++ Peer-to-peer networks (related technology: BitTorrent) ++ Distributed consensus (related technology: distributed databases, Raft) ++ Minting new coins (mining) ++ Embedded identities (related technology: TLS) ++ Smart contracts: Like SQL expressions & triggers ++ What can we really do with blockchains?

Bonus: Blockchain Books

Attack of the 50 Foot Blockchain: Bitcoin, Blockchain, Ethereum & Smart Contracts by David Gerard, London, 2017 – What is a bitcoin? ++ The Bitcoin ideology ++ The incredible promises of Bitcoin! ++ Early Bitcoin: the rise to the first bubble ++ How Bitcoin mining centralised ++ Who is Satoshi Nakamoto? ++ Spending bitcoins in 2017 ++ Trading bitcoins in 2017: the second crypto bubble ++ Altcoins ++ Smart contracts, stupid humans ++ Business bafflegab, but on the Blockchain ++ Case study: Why you can’t put the music industry on a blockchain

Mastering Bitcoin - Programming the Open Blockchain 2nd Edition, by Andreas M. Antonopoulos, 2017 - FREE (Online Source Version) – What Is Bitcoin? ++ How Bitcoin Works ++ Bitcoin Core: The Reference Implementation ++ Keys, Addresses ++ Wallets ++ Transactions ++ Advanced Transactions and Scripting ++ The Bitcoin Network ++ The Blockchain ++ Mining and Consensus ++ Bitcoin Security ++ Blockchain Applications

Blockchain for Dummies, IBM Limited Edition by Manav Gupta, 2017 - FREE (Digital Download w/ Email) – Grasping Blockchain Fundamentals ++ Taking a Look at How Blockchain Works ++ Propelling Business with Blockchains ++ Blockchain in Action: Use Cases ++ Hyperledger, a Linux Foundation Project ++ Ten Steps to Your First Blockchain application

Bonus: Awesome Blockchains

A collection about awesome blockchains - open distributed public databases w/ crypto hashes incl. git ;-). Blockchains are the new tulips. Distributed is the new centralized.

More @ openblockchains/awesome-blockchains

Bonus: Git, Git, Git - The Stupid Content Tracker with Crypto Hashes

Everything is local. Distributed is the new centralized.

Yep, that’s the joke. Nobody has been able to explain to me how the “blockchain” buzzword is significantly different to “git repo”. – Yaakov

But if you said “let’s build a currency where all transactions are stored in a git repo” you wouldn’t be taken seriously for even 24 hrs. – Yaakov

Soon explaining git like “a git repo is like a blockchain with commits instead of blocks”. – Nicolás Berger

“A local branch is like a state channel. It can be pushed and merged into the master blockchain at any moment.” – Nicolás Berger

The #Blockchain has changed the world. Here I make the argument that the #Blockchain is just like #git. – Jackson Kelley