Bitcoin Transparency
Using Blockchain
GROUP 1

Blockchain
A blockchain is a shared distributed database or ledger between computer
network. A blockchain serves as an electronic database for storing data in digital
form which can access by anyone. The most well-known use of blockchain
technology is for preserving a secure and decentralized record of transactions in
cryptocurrency systems like Bitcoin. The innovation of a blockchain is that it
fosters confidence without the necessity for a reliable third party by ensuring
the fidelity and security of a record of data.

History of Blockchain
A person name Satoshi Nakamoto first introduced the ideas of bitcoin and
blockchain in 2008, outlining how cryptography and an open distributed ledger
could be used to create a digital currency application (Nakamoto 2008). At
initially, bitcoin's development was somewhat constrained by its unusually high
volatility and the views of many nations against its complexity, but the benefits
of blockchain. The distributed ledger, decentralization, information
transparency, tamper-proof design, and openness of blockchain are some of its
benefits. Blockchain development has progressed over time. According to the
applications they support, blockchain is now divided into three versions: 1.0, 2.0,
and 3.0. we go into further information about the three blockchain generations.

Blockchain version
Blockchain 1.0 :
Blockchain technology was first applied in relation to virtual currencies like
bitcoin, which was not only the first and most popular digital money but also the
subject of blockchain 1.0. (Mainelli and Smith 2015)
Blockchain 2.0 :
Decentralized applications (Dapps), decentralised autonomous organizations
(DAOs), and decentralized autonomous corporations (DACs) are all broadly
referred to as part of Blockchain 2.0. (Swan 2015)

Blockchain version
Blockchain 3.0 :
This is the use of blockchain in industries other than currency and banking, such
as government, health, science, culture, and the arts, according to "Blockchain:
Blueprint for a New Economy“. Blockchain 3.0, which focuses on the governance
and regulation of the technology's decentralization in society, wants to
popularize the technology. Blockchain technology is a shifting target, according
to the breadth of this kind of blockchain and its prospective uses Blockchain 3.0
envisions a more sophisticated type of "smart contracts" to create a distributed
organizational unit with a high degree of autonomy and the ability to make and
be subject to its own laws

Bitcoin
A cryptocurrency, such as Bitcoin (BTC), eliminates the need for a third party to
be involved in financial transactions by acting as money and a means of
payment independent of any one person, group, or entity. It is available for
purchase on numerous platforms and is given to blockchain miners as
compensation for their efforts in verifying transactions.
Bitcoin is booming in these days and having a lot other coin which are being
used in cryptocurrency.

Working of Bitcoin Using Blockchain
Bitcoin is based on a distributed digital ledger known as a blockchain.
Blockchain, as the name implies, is a linked body of data made up of units called
blocks that contain information about each transaction, such as date and time,
total value, buyer and seller, and a unique identifying code for each exchange.
When a some amount of bitcoin is transferred the bitcoin basically use
blockchain technology and the Blockchain store two important type of data 1st
the transactional information from where the bitcoin come and where it has to
go. The 2nd important point is that to store the Hash value in order to make a
unique transaction each block of Blockchain has a unique Hash-value.

Public and private keys
You need both the public and private keys for the amount of bitcoin you wish to
send in order to transmit it. When we refer to a person as "owning" bitcoins,
what we mean is that they have access to a "key pair" made up of:
Public key: a public key (an address) to which a certain quantity of bitcoin has
previously been transmitted
Private key: A unique private key (a password) that allows the bitcoin that has
already been sent to the public key (address) mentioned above to be sent
somewhere else.

Public and private keys
Public keys, also known as bitcoin addresses, are alphanumeric strings of
characters that are produced at random and serve a similar purpose to an email
address or a username on a social media platform. Since they are public, as their
name suggests, sharing them with others is safe.

Steps of Bitcoin transaction
STEP 1: Transaction creation and signing
A transaction can be created by anyone using the three requirements. the
input, output, and quantity. Let's take the scenario where Hamza and Faiz are
trading bitcoin for dollars. Hamza must tell Faiz her public bitcoin address before
Faiz can start sending the bitcoin to Hamza. Faiz then creates the transaction and
signs it using his private key.

Steps of Bitcoin transaction
STEP 2: Broadcasting
The closest bitcoin network node receives the transaction after it is
created. It's important to know that the transaction need not be transmitted
immediately after creation. It might be transmitted many years after its creation
“ just need to be sure that you have enough bitcoins in the wallet when you
decide to send it”.

Steps of Bitcoin transaction
STEP 3: Propagation and verification
The transaction is broadcast throughout the network and confirmed once
it reaches the nearest node. When a block passes verification, it enters the
"Mempool" (short for Memory Pool) and waits patiently for a miner to pick it up
and add it to the following block.

Steps of Bitcoin transaction
STEP 4: Validation
As soon as a transaction is on the Mempool, miners begin to collect it
(first those who paid a higher transaction fee) and group it into blocks. As of May
2017, each block can only be 1 MB in size (the community is debating changing
this limit), and depending on the size of each transaction, it can include
anywhere between 2000 and 3000 transactions. The network then agrees on the
valid block, and consequently the transactions, on average every 10 minutes
using the Proof-of-Work Consensus Algorithm.

Future project directions for blockchain?
There are no of ideas come in mind after the success of Blockchain
1. Fake Product Identification
2. Crowdfunding
3. Data storage and sharing
4. Smart trading
5. Food tracking
6. Hospital Management for tracking record