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Table of Contents
Blockchain A blockchain is an immutable digital ledger that records every single transaction ever made.
- Blockchain transactions are irreversible in that, once they are recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.
- Layer 1 and layer 2: Refer to two distinct methods of designing blockchains. While some blockchains can operate independently, others are built on top of existing blockchains to add functionality. See Link
How the new blocks are generated in blockchain
- The hash of the info (data + Nonce) needs to have x4 leading zeros to be valid.
- Nonce (aka number used once) < Is the one the miners use in order to create a valid block (by creating a valid hash(ie: below a level (zeros) determined by the blockchain network)
Currencies
Blockchain helps to solve double-spending problem without the need of a trusted authority or central server.
Bitcoin
Bitcoin : Asset of value that can be interchanged securely without 3rd party. It was designed as a digital alternative to traditional currencies, aiming to provide a decentralized method of transferring value. Bitcoin transactions are verified by a network of nodes through cryptography and recorded on a public ledger called a blockchain. It has digital scarcity (concept of miners).
Proof of Work (for consensus among miners). Comptational effort discourgaes cheating.
Transaction and wallets. All transactions are verified (or rejected) by a global and decentralized network. The corresponding transaction (since the beginning of time) are uniquivocally assigned to my wallet, which establishes its balance now. That's why me, as the owner, do not 'have' the coins. I just have the private key associated to the walleta and to those transactions (and, as a consequence, to the balance). There's a public key associated, which is public and uses to send/receive me money.
BTC is the original Bitcoin's blockchain (1mb per block). Then it was forked to BCH (8mb per block)
Ethereum
- It is designed to be a platform that allows peer-to-peer smart contracts but it also does cryptocurrency, and applications to be built and run without any control, permission, or interference from third parties.
- Proof of Stake. Validator with more coins is more likely to be selected for the next one.
Agents
- Institutions (banks) do Asset Management. Also invest on your behalf with their strategies
Exchanges
- Binance (asia, like many of them)
- Coinbase
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