blockchain beyond bitcoin - snia · blockchain is the name of a new class of distributed...

Mark O’[email protected]

Blockchain Beyond Bitcoin

Blockchain Beyond BitcoinApproved SNIA Tutorial © 2017 Storage Networking Industry Association. All Rights Reserved.

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Abstract – Blockchain Beyond Bitcoin

Blockchain is the name of a new class of distributed application which can coordinate independent operations across multiple machines in an untrusted network and produce a consensus result on both the correctness of the individual operations as well as the order in which the operations were executed. While the most well known use case for blockchain is Bitcoin, the technology itself has many other applications and

implementations and use cases are arising in areas as diverse as international finance, B2B transactions, identity management, domain name registration, and many more. This tutorial will introduce the blockchain family of technologies, will discuss the technical aspects of the implementations and how consensus is achieved despite the lack of trust amongst the machines, will explore how this basic technology can be applied for non-currency related use cases, and will discuss alternative implementations of the technology and their advantages and

disadvantages.

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Definitions: Bitcoin vs Blockchain

Digital currencyNo gov’t controlCryptographically secured payments

Ordered list of recordsDistributed ledgerDecentralizedSelf-policing

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How does the bitcoin blockchain work?

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New tx Is it valid? Create a new block with this and other txs

Try to add it to the chain

If successful, tell other blockchain nodes about the new block


Why does this work?

• Cryptographically signed (PKI)

• Sent to multiple nodes

• Must reference txswhere money originated


Why does this work?

• Validate signature• Validate origin txs

• Must reference txswhere money originated

• Validated on multiple nodes


Why does this work?

• Block hash must match a certain pattern

• ~10 minutes to generate, by varying nonce


Why does this work?

Other nodes validate:• Txs are valid• Hash matches pattern• Links to final block


Why all the trouble?

Validate multiple times?10 minute Proof of Work?Designed for a no-trust environment


There’s more to life than money

Property deedsArtwork provenanceCar title / ownershipMedical history…

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There’s more than one way

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Po-tay-to ? Po-tah-to ?


What makes a distributed ledger?

Forgery protectionInformation distributionRedundant networkDecentralized networkInternal fraud protection

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An example

Forgery protection - PKIInformation distribution – nodes chatterRedundant network – mining rewardsDecentralized network – mining rewardsInternal fraud protection – Proof of Work

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An example

Forgery protection - PKIInformation distribution – nodes chatter – whitelistRedundant network – Interested participantsDecentralized network – Interested participantsInternal fraud protection – Whitelisted nodes

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An example

Forgery protection - PKIInformation distribution – Known node membershipRedundant network – Specific named nodesDecentralized network – Specific named nodesInternal fraud protection – Round robin mining

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Proof of Work alternatives

Once there is some trust:Round robinProof of StakeProportional to previously mined blocksPractical Byzantine Fault Tolerance

2/3rds of participants agree

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A world of possibilities

IdentityB2BSmart ContractsDRM

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Attribution & Feedback

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Please send any questions or comments regarding this SNIA Tutorial to [email protected]

The SNIA Education Committee thanks the following Individuals for their contributions to this Tutorial.

Authorship History

Mark O’Connell

Updates:

Additional Contributors

mailto:[email protected]


How does the Bitcoin blockchain work?

1. Send transaction to blockchain node (x bitcoins to Y)2. Node validates the transaction3. Node groups (ordered) transactions together4. Node “mines” the group

Competing against other miners5. Node broadcasts its results

If another miner got here first, go back to step 2

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Tx 1

Tx 2

Tx 3

Tx 4

Tx 5

…

Tx N-1

Tx N

Hash of block

Hash of prior block

Nonce

Tx aa

Tx ab

Tx ac

Tx ad

Tx ae

…

Tx ay

Tx az

Hash of block

Hash of prior block

Nonce

Tx zkjdaa

Tx zkjdab

Tx zkjdac

Tx zkjdad

Tx zkjdae

…

Tx zkjday

Tx zkjdaz

Hash of block

Hash of prior block

Nonce

Tx new1

Tx new2

Tx new3

Tx new4

Tx new5

…

Tx new N-1

Tx new N

TBD hash of block

Hash of prior block

TBD Nonce



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Tx 1

Tx 2

Tx 3

Tx 4

Tx 5

…

Tx N-1

Tx N

Hash of block

Hash of prior block

Nonce

Tx aa

Tx ab

Tx ac

Tx ad

Tx ae

…

Tx ay

Tx az

Hash of block

Hash of prior block

Nonce

Tx zkjdaa

Tx zkjdab

Tx zkjdac

Tx zkjdad

Tx zkjdae

…

Tx zkjday

Tx zkjdaz

Hash of block

Hash of prior block

Nonce

…


How does the bitcoin blockchain work?

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If successful, tell other blockchain nodes about the new block


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