PX 2018: Blockchain - Endterm Presentation
Johannes Schneider, Julian Weise
Software Architecture Group
Hasso Plattner Institute
University of Potsdam, Germany
---
Introduction
---
Previous century: researches invented continuously
Icons made by Freepik from www.flaticon.com
---
Problem: same ideas by multiple researchers
Icons made by Freepik from www.flaticon.com
---
Solution: write down idea and send to yourself
Icons made by Freepik from www.flaticon.com
---
Post office clerk will stamp each letter with timestamp
Icons made by Freepik from www.flaticon.com
---
Researcher has proof for invention at specific point of time
Icons made by Freepik from www.flaticon.com
---
Problem: Post office clerk might not be reliable
Icons made by Freepik from www.flaticon.com
---
Idea: Researchers maintain ledger collaboratively
Icons made by Freepik from www.flaticon.com
---
## Blockchain
"Decentralized, chronological updated database with a network based consensus mechanism for permanent confirmation of ownership."
Prof. Dr. Andreas Mitschele
- digital crypto currency
- value skyrocketed from basically $0 (2009) to ~$18.000 (2017)
-
concept published by Satoshi Nakamoto (pseudonym) in 2008
- shared ledger to keep track of all transactions
- aims to remove necessity of banks to clear transactions
- first stable implementation in 2009
---
Concepts
---
## Wallets transfer money
Icons made by Freepik from www.flaticon.com
---
## Transactions gather financials
Icons made by Freepik from www.flaticon.com
---
## Blocks keep track of transactions
Icons made by Freepik from www.flaticon.com
---
## Wallet
-
necessary to participate in payment transactions
- send transactions
- receive transactions
- basically set of private & public key
- used to sign transactions
- public key as identifier in payment network
### Usage
```javascript {.BlockchainImports .Hidden}
import BlockchainNode from 'src/blockchain/model/blockchainNode/blockchainNode.js';
import Wallet from 'src/blockchain/model/wallet/wallet.js';
import Transaction from 'src/blockchain/model/transaction/transaction.js';
import TransactionInputCollection from 'src/blockchain/model/transaction/transactionInputCollection.js';
import TransactionOutputCollection from 'src/blockchain/model/transaction/transactionOutputCollection.js';
import BlockNetworkView from 'src/blockchain/view/blockchainNetworkView.js';
```
```javascript {.InitializeWallet .NoResult}
import Wallet from 'src/blockchain/model/wallet/wallet.js';
const wallet = new Wallet();
```
```javascript {.DisplayWallet .Hidden}
lively.openComponentInWindow('blockchain-wallet').then(comp => {
comp.wallet = wallet;
});
```
### Receive payment
```javascript {.WalletReceiveTransactionPreparation .Hidden}
import Transaction from 'src/blockchain/model/transaction/transaction.js';
import TransactionInputCollection from 'src/blockchain/model/transaction/transactionInputCollection.js';
import TransactionOutputCollection from 'src/blockchain/model/transaction/transactionOutputCollection.js';
const inputCollection = new TransactionInputCollection(wallet);
inputCollection.addMiningReward({"minerHash": wallet.hash, "reward": 10});
inputCollection.finalize();
const outputCollection = new TransactionOutputCollection();
outputCollection.add(wallet, 5);
outputCollection.finalize();
const transaction = new Transaction(wallet, inputCollection, outputCollection);
```
```javascript {.WalletReceiveTransaction}
wallet.receive(transaction);
```
---
## Transaction
- fundamental atomic component of blockchain data structure
-
describes one timestamped change within ecosystem
- Bitcoin: single payment flow reserving some value on a wallet
- issued and signed by one wallet
- consumes outputs of other transactions → produces new outputs, which can be consumed
- transactions form an acyclic, directed graph
- Bitcoin: cash flow can be reconstructed
### Visualization
```javascript {.DisplayTransactionView .Hidden}
lively.query(this, '#transaction-view').transaction = transaction;
lively.query(this, '#transaction-view').style.display = 'block';
```
---
## Block
- periodically encapsulates transactions
- comparable to a ledger's page
- transactions summarized into a block are interpreted as valid
- creation of a block is called mining
- requires resource intensive / time consuming work to be done
- mining is rewarded (mining-reward and fees)
### Mining Challenge
```javascript {.MiningChallengeExample}
import forge from 'node_modules/node-forge/dist/forge.min.js';
const sha256 = forge.md.sha256.create();
const block = {'prevHash': "#3eFg7FA", "data": "...", "nonce": 0};
```
```javascript {.MiningChallengeIncraseNonce}
block['nonce'] = block['nonce'] + 1;
sha256.update(block);
sha256.digest().toHex();
```
---
## Blockchain
- each block refers it's preceding block (chain of blocks → chronological order)
- blockchain as overall ledger: furnishes proof of any change
- Bitcoin: any financial transaction
### Formation of a Blockchain
```javascript {.PrepareMining .Hidden}
import BlockchainNode from 'src/blockchain/model/blockchainNode/blockchainNode.js';
import BlockNetworkView from 'src/blockchain/view/blockNetworkView.js';
import NetworkComponent from 'src/blockchain/model/blockchainNode/networkComponent.js';
NetworkComponent.peers = [];
const node = new BlockchainNode();
const blockViewController = new BlockNetworkView(lively.query(this, '#blockchain-node-view-block'));
blockViewController.reset();
blockViewController.draw();
const walletView = lively.query(this, '#blockchain-wallet-block');
lively.query(this, '#blockchain-node-view-block').resize(600, 200).draw();
node.subscribe(blockViewController, (block) => {
blockViewController.addBlock(block);
blockViewController.draw();
walletView.wallet = node.wallet;
});
blockViewController
.addBlock(node.blockchain.headOfChain)
.draw();
walletView.wallet = node.wallet;
```
```javascript {.MineBlock .Hidden}
node.mine();
```
---
Networking
---
## Nodes
- participants within network are called nodes
- each node can perform several actions
- mine new blocks → Miner
- propagate Transactions → NetworkComponent
- maintain it's own Blockchain copy → Storage
Icons made by Freepik from www.flaticon.com
---
## Peer-To-Peer
- new nodes contact long-established ones to get initial information
- other peers
- already existing blockchain
- consensus rules ensure same Blockchain on majority of nodes
- blocks with solved mining-challenge are valid
- each transaction can only be spent once
- ...
- nodes / miner compete against each other while solving the mining challenge
```javascript {.RunFullDemo .Hidden}
lively.openComponentInWindow('blockchain-ui').then(comp => {
comp.createNewNode();
comp._nodes[0].subscribe(comp, comp.update.bind(comp));
comp.update(comp._nodes[0].blockchain.headOfChain);
});
```
---
## Distributed Trust
- blocks and transactions are timestamped → data is stored sequentially
- every block contains hash of prevoius block → tampering impossible
- thousands of nodes store their copy of the blockchain independently
- fundamental assumption: Majority of nodes operates trustworthy
- enough computational power to assert always providing longest chain
### Trust experiment
```javascript {.PrepareBlockchainValidation .Hidden}
import BlockchainNode from 'src/blockchain/model/blockchainNode/blockchainNode.js';
import NetworkComponent from 'src/blockchain/model/blockchainNode/networkComponent.js';
NetworkComponent.peers = [];
const node = new BlockchainNode();
const blockchain = node.blockchain;
node.mine();
node.mine();
```
```javascript {.ValidateBlockchainSuccessfully}
blockchain.isValid();
```
```javascript {.ValidateBlockchainUnsuccessfully}
blockchain.headOfChain.timestamp = 123456789;
blockchain.isValid();
```
---
## Blockchain validation
- novel approach to persist data tamper proof without need for central authority
- researcher: Proof for authorship of ideas / inventions without dependence on mail service
- bitcoin: Financial transactions without need for (central) banks clearing every transaction
- requires large number of peers to ensure security and tamper-resistants
- proof-of-Work-Concept consumes a lot of resources ~ 71 TWh / year → Energy consumption Czech Republic
- waste of storage: Blockchain is duplicated multiple times over all nodes
- bad throughput in comparison to conventional (distributed) storage solutions
---
## Active Essay / Interactive presentation
### What we did within Lively
- implemented a basic blockchain (wallet, transactions, -input and -outputs, blocks)
- simulated an entire peer-to-peer network
- built multiple visualizations
- created this interactive presentation
### How does the audience profit from this approach?
- interactive approach lets user apply gained knowledge
- visualizations make complex concept more tangible
- demonstration in separate UI makes collaboration of single concepts better understandable