class1-reading.presentation

Bitcoin：A peer-to-peer electronic cash system

Abstract

• solve: double-spending problem

To solve this, we
proposed a peer-to-peer network using proof-of-work to record a public history of transactions
that quickly becomes computationally impractical for an attacker to change if honest nodes
control a majority of CPU power.

The network timestamps transactions by hashing them into an ongoing chain of
hash-based proof-of-work, forming a record that cannot be changed without redoing
the proof-of-work.

The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power.
As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they’ll generate the longest chain and outpace attackers.

1. Introduction

• propose a solution：using a peer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions.

The system is secure as long as honest nodes collectively control more CPU power than any cooperaing group of attacker nodes.

2. Transactions

• an electronic coin as a chain of digital signatures.
• The only way to confirm the absence of a transactions is to be aware of all transactions.
• The payee needs proof that at the time of each transaction, the majority of nodes agreed it was the first received.

3. Timestamp Server

• distributed timestamp server

4. Proof-of-Work

• Once the CPU effort has been expended to make it satisfy the proof-of-work, the block cannot be changed without redoing the work.
• As later blocks are chained after it, the work to change the block would include redoing all the blocks after it.
• solve the problem of determining representation in majority decision making.（one-CPU-one-vote）
  

5. Network

node：

• broadcast
• a block：broadcast/accept
• proof-of-work

• Nodes always consider the longest chain to be the correct one and will keep working on
  extending it.
• New transaction broadcasts do not necessarily need to reach all nodes.

6. Incentive

-By convention, the first transaction in a block is a special transaction that starts a new coin owned by the creator of the block.

This adds an incentive for nodes to support the network and provides a way to initially distribute coins into circulation, since there is no central authority to issue them.

• The incentive can also be funded with transaction fees.

7. Reclaiming Disk Space

• for solving the storage problem
• transactions are hashed in a Merkle Tree, with only the root included in the block’s hash.

Old blocks can then be compacted by stubbing off branches of the tree. The interior hashes do not need to be stored.

8. Simplified Payment Verification- A user only needs to keep

• a copy of the block headers of the longest proof-of-work chain, which he can get by querying network nodes until he’s convinced he has the longest chain, and obtain the Merkle branch linking the transaction to the block it’s timestamped in.
  

9. Combining and Splitting Value

• To allow value to be split and combined, transactions contain multiple inputs and ooutputs.
  

10.Privacy

• by limiting access to information to the
  parties involved and the trusted third party.

11. Calculations（waiting）

12. Conclusion

• we proposed a peer-to-peer network using proof-of-work to record a public history of transactions that quickly becomes computationally impractical for an attacker to change if honest nodes control a majority of CPU power.
• The network is robust in its unstructured simplicity. Nodes work all at once with little coordination. They do not need to be identified, since messages are not routed to any particular place and only need to be delivered on a best effort basis.
• Nodes can leave and rejoin the network at will, accepting the proof-of-work chain as proof of what happened while they were gone.
• They vote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them.
• Any needed rules and incentives can be enforced with this consensus mechanism.

---

脑海中记忆：

1. 为了解决数字货币被重复使用而导致的失值问题，于是采用端到端由节点构成的分布式网络，实现交易信息的存储
2. 采用对区块链（block-chain）的broadcast和accept的方式实现不需要第三方监督的实时交易，保证了低成本

• 奖励机制：矿工挖矿获得最初的货币，货币是自动产生的，不是由银行或哪个机构发行铸造的。
• 可信与隐私机制：保证诚实节点在网络中占优势的基础之上

3. 实现基于的是计算能力，一个CPU对应一个node，连接到网络上

存在的困惑

1. 区块链与比特币：比特币具体怎么从计算难题解决中产生的
2. 区块链的详细实现机制，隐私保障细节

• bitcoin：crypto currency加密货币

A Cypherpunk’s Manifesto

• 隐私对于电子时代的开放社会是必要的
• 必须确保交易机制的尽可能地少透露客户信息。

• 开放社会中的隐私需要匿名交易系统。金钱交易一直是这类系统的主要功能。
• 匿名系统使得个人能够在需要时且仅在需要时才透露自己的身份，这是隐私的本质。

• 加密是对隐私权的保障，默认为匿名时，要确保透露自己的身份时需要密码签名

Cypherpunks（发布代码）构建匿名系统，通过：加密、匿名邮件转发系统、数字签名和电子货币来捍卫隐私。

Block chain For Real-World Business Problems

• business behavior：no cost，no delay
• government transparency
• Internet information is Internet value
• identity：data for yourself，privacy——virtual you：个体创造了数据，但使用这些数据的人是统治者、科技垄断公司——owned by you and used for you

• smart contract

My reading homework

After reading the text of Bitcoin: A peer-to-peer electronic cash system, I learn about the main idea of block chain and basically know about what roles it plays and how it works.
The peer-to-peer network using proof-of-work is proposed to record a public history of transactions that quickly becomes computationally impartical for an attacker to change if honest nodes control a majority of CPU power.
Nodes of network can leave and rejoin the network at will, accepting the proof-of-work chain as proof of what happened while they were gone. And they vote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them.
Besides, an incentive is added to support the network and provide a way to initially distribute coins into circulation, since there is no central authority to issue them.
In a nut word, the most attractive piont of the block chain is that it can advance the goal of transactions without a cost of the third party and guarantee the privacy of participants in the meantime. Foreseeing the the rapid development of technology, I assume that block chain will, of course, change the industry of all walks of life.

By watching the vedios of Don Tapscott’s speech, I can see the wide application of block chain which has great internet value. The most useful part of it in my opinion is the application about the identity. One of the most concerned topics of 21 century is the privacy of data, especially when we are faced with the monopoly of the giant IT companies like Facebook, Google, Apple and so on. The value of data which we create is not used by ourselves. And Fortunately, block chain is a valid approach to solve this sensitive problem.

All in all, I learn more about block chain than before by this reading and watching, and I want to learn more details of work principle of block chain. I am looking forward to studying the next lesson!