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Blockchain Primer

Blockchain: A Graph Primer Blockonomics Blog

Blockchain: A Graph Primer Blockonomics Blog

This post is an abridged version of our manuscript, which contains an additional section on Blockchain analysis. See the full version in PDF here . Bitcoin and its underlying technology Blockchain have become popular in recent years. Designed to facilitate a secure distributed platform without central authorities, Blockchain is heralded as a paradigm that will be as powerful as Big Data, Cloud Computing and Machine learning. Blockchain incorporates novel ideas from various fields such as public key encryption and distributed systems. As such, a reader often comes across resources that explain the Blockchain technology from a certain perspective only, leaving the reader with more questions than before. We will offer a holistic view. Starting with its brief history, we will give the building blocks of Blockchain, and explain their interactions. We devote Section 4 to the future of Blockchain and explain how extensions like Smart Contracts and De-centralized Autonomous Organizations will function. Without assuming any reader expertise, our aim is to provide a concise but complete description of the Blockchain technology In simple terms, Blockchain is a distributed database that is secure by design. It was proposed by the unknown author Satoshi Nakamoto in 2008 [37]. Blockchain consists of blocks of transactions that can be verified and confirmed without a central authority. The technology has been popularized through its use in the digital currency Bitcoin, where each transaction is financial by nature. As the origins of Blockchain start with Bitcoin, it is easy to confound the two. Mostly people refer to Bitcoin and Blockchain interchangeably. It started with Bitcoin, but found usage in many new areas (See Section 3 by Mattila [31]). Companies have created Blockchain app Continue reading >>

Blockchain: A Primer

Blockchain: A Primer

The Bitcoin blockchain is the primary innovation in Bitcoin that makes it practical. Blockchains have applications in many contexts other than cryptocurrencies. This note is an introduction to blockchains that requires no prior knowledge, including of Bitcoin. Blockchains are ledgers of transactions kept by a set of participants, none of which is accorded special status as the correct one. Instead, agreement is reached by a process of consensus. I show how this works for Bitcoin, discuss applications in many alternative settings and provide some detail about a very different proof-of-concept application of blockchains by the Japan Exchange Group. Dwyer, Gerald P, 2016. " Blockchain: A Primer ," MPRA Paper 76562, University Library of Munich, Germany. File URL: Brandvold, Morten & Molnr, Peter & Vagstad, Kristian & Andreas Valstad, Ole Christian, 2015." Price discovery on Bitcoin exchanges ," Journal of International Financial Markets, Institutions and Money ,Elsevier, vol. 36(C), pages 18-35. Full references (including those not matched with items on IDEAS) G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data) G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation This paper has been announced in the following NEP Reports : NEP-PAY-2017-02-12 (Payment Systems & Financial Technology) Al Continue reading >>

The Blockchain Primer That George Washington Would Understand

The Blockchain Primer That George Washington Would Understand

A map of Manhattan and Wall Street in 1661. Like New Amsterdam, blockchains are still just gettingstarted. The Blockchain Primer That George Washington Would Understand Blockchains. Decentralized protocols. Distributed ledgers. Cryptographic hash functions. Consensus algorithms. The sheer amount of terminology around cryptocurrencies can make you feel like someone transported in time from the 18th century. Not only are you trying to familiarize yourself with some of the more mind-bending concepts in computer science, but you also have to deal with a great dose of economics jargon. Blockchains are bringing together two opposites of the scientific mindset, which may initially seem to be at odds with each other. On one side of the ring, we have the extreme unforgiving rigor of cryptography: a math-heavy branch of computer science that used to be the exclusive domain of dusty academics. At the other side of the ring stands the brash superstar of social sciences, the economist; ready to pounce, competitive, possessing what some would describe as an abrasive personality. In this situation, however, opposites attract! When two such discrete sciences meet, there is unique opportunity in the air but also ample room for misunderstanding and misdirection by bad actors. So what is that makes the blockchain unique? A marriage of economics and cryptography, ok but is it all just about a technological solution? If you read online discussions, you may find that most participants are very caught up in high-pitch debates involving the merits of exceptionally specific details of blockchain implementations. Getting the big picture is not easy. Fundamentally the most important part of blockchains is not algorithms, nor cloud servers, nor user interfaces its people. More specifically: its a Continue reading >>

A Blockchain Primer

A Blockchain Primer

The Blockchain was created to enable the first viable digital currency, known as Bitcoin. The idea was to have a decentralized currency that did not rely on banks or other financial institutions for its integrity or legitimacy. But, as well see, the concept is fundamentally designed to be an integrity decentralization technology in general, and isnt specific to financial use cases. The Block Chain is a distributed database of transactions powered by public-key cryptography. The core concept that makes it different from centralized banks is that all transactions, and in fact all of the currency itself, is stored in a public ledger that is kept by all participants in the system. Blocks are a key part of the technology, and they have the following characteristics: they are small sets of transactions that have taken place within the system each new block includes a SHA-256 hash of the previous transaction that which chains it to all previous blocks blocks are computationally difficult to create, taking multiple specialized processors and significant amounts of time to generate The fact that blocks are both difficult to generate, and that in order to change one youd have to successfully change all previous ones, makes the block chain particularly resistant to tampering. To send or receive money using Bitcoin (the most popular block chain implementation) one creates a Bitcoin address (really just a long alphanumeric token) that can be used to either send or receive. The use of the public/private keypairs ensures that payments are sent and received by the correct individuals. The Blockchain concept is important because it represents a technological framework for decentralization. Many industries, such as banking, credit scoring, money transfers, etc., rely on someone in the m Continue reading >>

Chatham House Primer: Blockchain

Chatham House Primer: Blockchain

Dr Garrick Hileman, Researcher, University of Cambridge and London School of Economics; CEO and Head of Research, Mosaic.io This event is now fully booked and registration has closed. Although the mechanics of blockchain are extremely complex, the basic idea is simple: to decentralize the storage of data so that such data cannot be owned, controlled or manipulated by a central actor. The recent surge in and subsequent collapse of the value of Bitcoin has brought renewed attention to the blockchain architecture that underpins cryptocurrencies. However, blockchains uses go far beyond virtual money. The technology could change the way that ownership, privacy, uncertainty and collaboration are conceived of in the digital world, disrupting sectors and practices as diverse as financial markets, content distribution, supply chain management, the dispersal of humanitarian aid and even voting in a general election. Dr Garrick Hileman will explain the basic concept of a blockchain, outlining some of the technologys current uses as well as suggesting a number of these potential future applications that could revolutionize the global economy. The basic idea: Blockchain and distributed ledger technology Other current applications: Smart contracts, DApps, DAOs, Stablecoins Future disruption: The potential of blockchain Are there other reasons to be cautious of the evolution of blockchain? The Chatham House Primer Series is a unique programme of talks designed to bridge the gap between introductory level subject knowledge and a more advanced understanding geared towards practical application, higher-level discussion and policy debate. With each talk hosted by a leading expert, the Primer series aims to provide the audience with a solid grounding in topics of academic curiosity, key i Continue reading >>

Blockchain A Technical Primer For 2018

Blockchain A Technical Primer For 2018

The last 18 months has seen a phenomenal growth in the interest in Blockchain. Businesses are moving quickly to embrace it. This article will examine the technical aspects associated with a Blockchain. Get instant access to the most important Financial Technology paper ever written!! A blockchain consists of blocks that hold batches of valid and immutable transactions . Each block includes the hash of the prior block in the blockchain, linking the two. A hash might be described as the mathematical DNA of a transaction or piece of information. And just like DNA the hash of each block is passed down to the hash of the next block. The linked blocks form a chain, all the way back to the first block called the Genesis Block . Any minor change in any prior block will produce a vastly different hash and cause a major change in the hash of subsequent blocks. This difference is obvious to other computers in the distribute network and is therefore penalised as per the scoring system described below. In addition to a secure hash based history, any blockchain database has a specified algorithm for scoring different versions of the history so that one with a higher value can be selected over others. Peers supporting the database dont have exactly the same version of the history at all times, rather they keep the highest scoring version of the database that they currently know of. Whenever a peer receives a higher scoring version (usually the old version with a single new block added), they extend or overwrite their own database and retransmit the improvement to their peers. There is never an absolute guarantee that any particular entry will remain in the best version of the history forever. Blockchains are typically built to add the score of new blocks onto old blocks. There are in Continue reading >>

Blockchain Explained In Plain English

Blockchain Explained In Plain English

Understanding how blockchain works and identifying myths about its powers are the first steps to developing blockchain technologies After spending two years researching blockchain and the evolution of advanced ledger technologies, I still find a great spectrum of understanding across my clients and business at large about blockchain. While ledger superpowers like Hyperledger, IBM, Microsoft and R3 are emerging, there remains a long tail of startups trying to innovate on the first generation public blockchains. Most of the best-selling blockchain books confine themselves to Bitcoin, and extrapolate its apparent magic into a dizzying array of imagined use cases. And I'm continuously surprised to find people who are only just hearing about blockchain now. It can seem that everyone is talking about blockchain and ledger technologies, but the truth is most people are not yet up to speed. No one should be shy to ask what blockchain is really all about. Many blockchain primers and infographics dive into the cryptography, trying to explain to lay people how "consensus algorithms", "hash functions" and digital signatures all work. In their enthusiasm, they can speed past the fundamental question of what blockchain was really designed to do. I've long been worried about a lack of critical thinking around blockchain and the activity it's inspired. If you want to develop blockchain applications you only need to know what blockchain does, and not how it does it. So I've written a report that explains how the blockchain works . It examines the founding principles of blockchain, describes its properties, and dispels common myths about its powers. The explanation below is an abridged excerpt from the report. Blockchain is an algorithm and distributed data structure for managing electr Continue reading >>

What Is Blockchain? A Primer For Finance Professionals

What Is Blockchain? A Primer For Finance Professionals

What is Blockchain? A Primer for Finance Professionals By Steve Cox, Group Vice President, ERP and EPM Cloud Business Group, Oracle Its often not easy to envision or understand a new technology when we first hear about itespecially when the technology is not something that you can see, hold or touch. Everyone can see what a smartphone is, and most finance professionals understand the impact that related technologies, like mobile and social, have had on the way we conduct business. Emerging technologies are a different matter. My colleagues have already written primers on new technologies such as machine learning , artificial intelligence and robotics process automation . Today, Id like to take a closer look at blockchainanother new concept that finance teams are only beginning to grasp. When writing about complex ideas, my editor likes to say, Explain it to me as if Ive never worked in in a technology company. So, lets start with a simplified example. Imagine that you have a child in university, and every month, you send them a living allowance. There are a number of ways you can do this, but the most common is transferring money from your bank account into your childs. There are two records of this transaction: a debit recorded in your bank account, and a credit in your childs account. In most circumstances, neither of you can see the others bank records. Banks keep separate ledgers on their customers behalf, and they spend a lot of time and money ensuring that these ledgers are accurate, and private. But what if you didnt want the ledgers to be private? What if you wanted both you and your child to have access to a single ledger, with all transactions visible to you both? In the past, this would require setting up a joint bank account. Blockchain offers a different a Continue reading >>

A Primer On Blockchain-based Versions Of Central-bank Money - Central-bank Digital Currencies

A Primer On Blockchain-based Versions Of Central-bank Money - Central-bank Digital Currencies

BITCOIN, Ethereum, XRP, Stellar, Cardano: the infant world of cryptocurrencies is already mind-bogglingly crowded. Amid the cacophony of blockchain-based would-be substitutes for official currencies, central banks from Singapore to Sweden have been pondering whether they should issue digital versions of their own money, too. None is about to do so, but a report prepared by central-bank officials from around the world, published by the Bank for International Settlements on March 12tha week before finance ministers and central-bank heads from G20 countries meet in Buenos Airesoffers a guide to how to approach the task. The answer? With care. For a start, it matters who will be using these central-bank digital currencies (CBDCs). Existing central-bank money comes in two flavours: notes and coins available to anyone; and reserve and settlement accounts open only to commercial banks, already in electronic form (though not based on blockchain) and used for interbank payments. Similarly, CBDCs could be either widely available or tightly restricted. A CBDC open to all would in effect allow anyone to have an account at the central bank. CBDCs could be transferred either peer to peer, like cash, or through the banking system. They could be held anonymously, preserving the privacy of cash, or tagged, making it easier to trace suspicious transactions. Should they bear interest, that would affect demand not only for CBDCs but also for cash, bank deposits and government bonds. The report weighs up CBDCs possible effects on payment systems, monetary policy and financial stability. A steep decline in the use of cash could strengthen the case for a widely available CBDC. In Sweden the Riksbank is contemplating an e-krona for small payments. But in most countries, despite the growing us Continue reading >>

What Is Blockchain Technology? A Step-by-step Guide For Beginners

What Is Blockchain Technology? A Step-by-step Guide For Beginners

What is Blockchain Technology? A Step-by-Step Guide For Beginners Angel Investors, Startups & Blockchain developers... Is blockchain technology the new internet? The blockchain is an undeniably ingenious invention the brainchild of a person or group of people known by the pseudonym, Satoshi Nakamoto . But since then, it has evolved into something greater, and themain question every single person is asking is: What is Blockchain? By allowing digital information to be distributed but not copied, blockchain technology created the backbone of a new type of internet. Originally devised for the digital currency , Bitcoin , the tech community is now finding other potential uses for the technology. Bitcoin has been called digital gold, and for a good reason. To date, the total value of the currency is close to $9 billion US. And blockchains can make other types of digital value. Like the internet (or your car), you dont need to know how the blockchain works to use it. However, having a basic knowledge of this new technology shows why its considered revolutionary. So, we hope you enjoy this, what is Blockchain guide. The blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value. Picture a spreadsheet that is duplicated thousands of times across a network of computers. Then imagine that this network is designed to regularly update this spreadsheet and you have a basic understanding of the blockchain. Information held on a blockchain exists as a shared and continually reconciled database. This is a way of using the network that has obvious benefits. The blockchain database isnt stored in any single location, meaning the records it keeps are truly public and easily verif Continue reading >>

Blockchain: The New Technology Of Trust

Blockchain: The New Technology Of Trust

A transaction's address is a string of letters and numbers that uniquely identify it. Addresses are publicly viewable on the blockchain. A database of information from multiple transactions, similar to a page in a ledger. Each block is time stamped, and those time stamps are used to order the blocks as they're added to the blockchain. The hash, generated by the cryptographic hash function, is what makes the blockchain secure. Each hash is unique to the block it came from a kind of digital fingerprint of the original data. This process only works in one direction: If you start with the hash, its nearly impossible to recreate the original block. The hash function is a piece of cryptographic math. It takes regular data and generates a short alphanumeric code. The function works in one direction: it's easy to turn regular data into a hash, but nearly impossible to reconstruct the original data from the hash. A private key is a string of letters and numbers that works like a password: it "unlocks" a blockchain address, allowing one party in a transaction to establish ownership of money, items or information. The private key is a hash of the transaction address. A smart contract is a computer program with a fixed set of rules that have been agreed to by both parties in a transaction. When triggered, it can work with multiple blockchains to execute those rules. For example, in a stock transaction, it can access one blockchain that tracks stock ownership and another that tracks ownership of cash. That allows it to transfer stock to the buyer and cash to the seller. On the blockchain, a transaction is any movement of goods, payments or confidential data. That could be what we usually think of as a transactionbuying and sellingbut it could also be someone sharing a piece of pers Continue reading >>

A Technical Primer On Blockchain | Deloitte Insights

A Technical Primer On Blockchain | Deloitte Insights

Just as the Internet revolutionized the very idea of information, blockchain seems set to challenge and transform conventional notions of value. A lot of the technologys success, however, depends on businesses understanding of its potential and applicability. Subscribe to receive updates on Emerging Technologies Blockchain, in many ways, appears to signify the dawn of a new era as it relates to the way we store and exchange value. In fact, it can be considered one of the biggest technology breakthroughs in recent history, similar to the advent of the Internet in the early 1990s. At that time, the Internet provided a new and more sophisticated way to search and share information, a way that was much more efficient and transparent. Today, blockchain presents a similar value proposition and provides a way to transact in a secure, immutable, transparent, and auditable way. However, the understanding of the technology varies widely in terms of its potential and applicability. Through this primer, we aim to demystify blockchain and share our assessment of the current and future landscape, key drivers and impediments, potential applications, and considerations for companies. A blockchain is a digital and distributed ledger of transactions, recorded and replicated in real time across a network of computers or nodes (figure 1). Every transaction must be cryptographically validated via a consensus mechanism executed by the nodes before being permanently added as a new block at the end of the chain. There is no need for a central authority to approve the transaction, which is why blockchain is sometimes referred to as a peer-to-peer trustless mechanism. Broadly, there are three levels of blockchain utilization 1 (figure 2): Storage of digital records: Blockchain can be used to st Continue reading >>

Developing Blockchain For Healthcare, Primer

Developing Blockchain For Healthcare, Primer

Developing Blockchain for Healthcare, Primer Developing Blockchain for Healthcare, primer and introduction. This is more of an opinion-piece (it lacks formal citing). - Why does the Healthcare Industry need something like Blockchain? - How should it be developed technically? Ill be exploring & developing Blockchain For Healthcare. This first part serves as a primer, and introduction exploring why the industry needs healthcare, and how developmental efforts should work. I actually only got started on this path around 3 months ago. I was sent an invite to a Healthcare innovation contest , where six finalists end up pitching-off in Vegas for a $10k prize. I made it to that round, but I didnt win. Healthcare was never a passion of mine, but I was passionate about the competition (probably for wrong reasons that are out of context here). The point is that I wasnt prepared to deliver any compelling idea that an insanely complicated industry, such as Healthcare, would consider. It wasnt until my flight to Vegas, when I was thoroughly reviewing & creating a strategy for my pitch, that I realized how unprepared I was. My submitted presentation offered nothing new beyond already defined buzzwords and a naive solution. Unlike the cryptocurrency environment, I wasnt going to create considerable hype with a cool slide-deck or demo. Ive learned a lot though, and think a possible blockchain solution for healthcare would be beneficial for people and the industry. For those interested here is my (now outdated) entry , pitch deck , infographic , and a digital-demo that is NOT mobile responsive & runs best in Chrome. Why does the Healthcare industry need something like Blockchain? Data in Healthcare is Fd. Ill start with a notable example: Some critically-ill people carry around thick bi Continue reading >>

Blockchains Explained: A Primer On Cryptocurrencies, Bitcoin, And Ethereum

Blockchains Explained: A Primer On Cryptocurrencies, Bitcoin, And Ethereum

Blockchains Explained: A Primer on Cryptocurrencies, Bitcoin, and Ethereum Blockchainsare nothing new: Bitcoins blockchain was implemented in 2009, and research papers on blockchains date back to the early 90s. While I had heard about Bitcoin and blockchains, I didnt fully understand them, and the gaps in my knowledge came to light when my grandma asked me to explain Bitcoin to her. This post is intended to explain what blockchains are, how they work, why someone would want to use them, and whats coming up next. Note: This post often refers to Bitcoin and Ethereum to explain concepts, but these are examples of blockchains and are not totallyequivalent. In your everyday life, if you want to buy something, you exchange money with a business or person for the thing you want to buy. Before computing was widespread, people used physical representations of money (dollars, coins, gold). Now, we also use digital records of money. Whether you rely on physical or digital means, you are trusting some kind of outside group to create and regulate the physical representations of money (the Federal Reserve), keep accurate bookkeeping records (banks, state and national laws on bank records, etc.), and prevent theft, double-spending, and fraud (laws, law enforcement, counterfeit protection, etc.). Im glossing over some things here, but the point is that everyone follows the rules that external entities have madebecause if someone breaks those rules, those entities have the authority to step in and act. Cryptocurrencies have the same ideascreation, regulation, accurate bookkeeping, and prevention of theftbut theres no outside group to monitor them. This makes Bitcoin and other cryptocurrencies trustless. In other words, there is no outside group or third party that must be trusted for t Continue reading >>

How Bitcoin And Blockchain Work: A Primer Kaspersky Lab Official Blog

How Bitcoin And Blockchain Work: A Primer Kaspersky Lab Official Blog

Bitcoin, and its fundamental technology blockchain, have been popping up in the news plenty over the past few years. However, discussion about them is typically a bit high level or, OK, gibberish leaving the average person with the vague impression that something cool is happening with currency, but very little in the way of actual knowledge or understanding. The technology is indeed elegant, but it is not that difficult to understand. Well take a shot at explaining in a straightforward way how blockchain works, avoiding geeky jargon as much as possible. Anyone can generate a digital name and digital signature. Those arent like your typed name and handwritten signature; they are a public key and a private key, respectively. Having these digital assets enables the following scenario: A person can write messages, sign them digitally, and publish online. The world can see that the message is genuine people can identify the persons digital name thanks to the digital signature. A person may generate numerous name-and-signature pairs (think of them as stage names) for various purposes. Kaspersky Lab (@kaspersky) November 8, 2013 Lets say I write a message (Hello) and want to send it to my friend. But I need to make sure it reaches the intended recipient unaltered. How would I do that? The easiest way would be to ask my friend to send the whole message back to me so I can compare the two messages and see if they match. Many people use the same approach when dictating some numbers or spelling e-mail addresses over the phone. However, the message might reach my friend perfectly but break on its way back, and in that case we would not be able to ensure its integrity. Moreover, the message might be very long. What if the message contains a high-def video? It makes no sense to sen Continue reading >>

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