A Quick primer on Blockchain basics for the Big Data Groningen Meetup

1. What is Blockchain?
2017-03-23, Big Data Groningen - IBM Groningen

2. www.bitcoinproperly.org

3. Three points
1. Incumbents do not get it
2. Most people talk about ‘blockchain” but don’t get
it
3. …
@RonaldMulder en @lykle

4. The Incumbents don’t get it
(they are your clients!)
@RonaldMulder en @lykle

5. It is not a regular database
It has no regular balances, or state values
@RonaldMulder en @lykle

6. @RonaldMulder en @lykle

7. 35

8. I’ve come up with a set of rules that describe our reaction
to technologies:
1.Anything that is in the world when you’re born is normal
and ordinary and is just a natural part of the way the
world works.
2.Anything that’s invented between when you’re fifteen
and thirty-five is new and exciting and revolutionary and
you can probably get a career in it.
3.Anything invented after you’re thirty-five is against the
natural order of things.
Douglas Adams - The Salmon of Doubt

9. 1970 20161992 2007200920001988
@RonaldMulder en @lykle

10. Most people do not understand what
Blockchain is
(that means, you, your client, and their advisors)
@RonaldMulder en @lykle

11. What is this?
@RonaldMulder en @lykle

12. Tone Vays
@RonaldMulder en @lykle

13. Bitcoin - How it works
weeelllll….
@RonaldMulder en @lykle

14. Bitcoin
• public/private key cryptography
• hashing
• endogenous digital asset (“coin”)
• peer-to-peer, distributed
• permissionless
• proof of work
@RonaldMulder en @lykle

15. Public/Private Key Infrastructure
(elliptic curve digital signature algorithm)

16. Bitcoin: transactions
@RonaldMulder en @lykle

17. Transaction Chain
@RonaldMulder en @lykle

18. Bitcoin: Proof of Work
done by Miners
@RonaldMulder en @lykle

19. Miner’s incentive

20. Network
1. New transactions are broadcast to all nodes
2. Each node collects new transactions into a block
3. Each node works on finding a difficult proof-of-work for its block
4. When a node finds a proof-of-work it broadcasts the block to all
nodes
5. Nodes accept the block only if all transactions in it are valid and not
already spent
6. Nodes express their acceptance of the block by working on creating
the next block in the chain, using the hash of the accepted block as
the previous hash
@RonaldMulder en @lykle

21. two chains, actually
(in Bitcoin)

22. Bitcoin has no balances
No ledger in the traditional sense

23. Distributed Ledger Technology
like Blockchain, but (totally) different

24. Bitcoin vs DLT
• public/private key
cryptography
• hashing
• endogenous digital asset
(“coin”)
• peer-to-peer, distributed
• permissionless
• proof of work
@RonaldMulder en @lykle
• public/private key
cryptography
• hashing
• endogenous digital asset
(“coin”)
• peer-to-peer, distributed
• permissionless
• proof of work??

25. Bitcoin vs Ethereum
• 10 minute cycle
• Finite amount of coins
• Transaction costs
• hashing: SHA256
• Mining Pools possible
• proof of work
• Transactions
• Stack based Language
@RonaldMulder en @lykle
• 12 second cycle
• Yearly new coins forever
• “Gas” to charge transactions on
complex criteria
• hashing: ethash
• Mining pools not attractive
• proof of work becomes Proof of Stake
• State
• Turing Complete Language

26. Three points
1. Incumbents do not get it
2. Most people talk about ‘blockchain” but don’t get
it
3. …
@RonaldMulder en @lykle

27. You STILL do not get it
@RonaldMulder en @lykle

28. Seriously, you don’t

29. Why is Blockchain hard to
understand?
• In the case of Bitcoin, it is at the crossroads of:
• Game Theory
• Cryptography
• Computer networking and data transmissions
• Economic and monetary policies

30. Gartner Hype Cycle 2016

31. Build! Fail! Build! Test!
Lead the World
@RonaldMulder en @lykle

32. Thank You!
@thesisone, @lykle, @BTCEvangelist