Introduction to Blockchain

Austin Hardt

Today's Agenda

  • Definition and Theory
  • Smart Contracts
  • Applications
  • Demo and Q&A

Definition & Theory

What is a blockchain?


In short, it's an immutable distributed ledger

Why is it called a blockchain?

Transactional Data

Hash of the block

Hash of the previous block

If the data in a previous block is tampered with, the hash changes, and invalidates all of the following blocks


However, this validation mechanism is not enough to ensure security

Proof-of-Work


A mechanism to slow the creation of new blocks by requiring proof of intensive computation (e.g., solving complex puzzles)

Blockchains are distributed


Nodes create consensus on the validity of the blockchain

To successfully tamper with a blockchain you'll need to tamper with all blocks on the chain, redo the proof-of-work for each block and take control of over 50% of the nodes


This is almost impossible to do

Recap


Immutable, history cannot be changed

Distributed, proof-of-work consensus mechanism required

Trust through transparency and security

Smart Contracts

What are smart contracts?


Pieces of code that codify business logic

These programs facilitate three functions


Store rules

Verify rules

Self-execute rules

A common analogy — Vending Machine


Insert $1, get snack

Verify the amount is $1

Then the machine vends

But why trust a smart contract?


Since smart contracts are stored on a blockchain, they inherit immutable and distributed properties

Ethereum Blockchain & Solidity

Not limited to escrow


Containers of code that digitally facilitate, verify, or enforce the negotiation and performance of a contract

Applications

Cryptocurrency


Secure alternative to physical currency, decentralized, cuts out intermediaries

Supply Chain Management


Transactions, location, quality, certification, and other relevant information can be recored into an organization's blockchain. The availability of this information can increase traceability of material supply chain, improve visibility

Record Managment


Census

Healthcare

Real Estate

Elections

Advertising


Ad spend, inventory, and impressions tracking

Demo and Q&A