Ethereum Blockchain Development
Ego Slide
francesco.strazzullo@ideato.it
@TheStrazz86
https://github.com/francesco-strazzullo
https://medium.com/@TheStrazz86
https://slides.com/francescostrazzullo
Why are you here?
Blockchain
What problems does it solve?
Lack of trust
Trasparency
Immutability
Blockchain is a decentralized consensus mechanism. In a blockchain, all peers eventually come to an agreement regarding the state of a transaction.
Imran Bashir
Blockchain can be considered a shared ledger of transactions.
Imran Bashir
Blockchain is a data structure; it is basically a linked list that uses hash pointers instead of normal pointers. Hash pointers are used to point to the previous block.
Imran Bashir
Graph by Imran Bashir
Graph by Imran Bashir
Challenges
Scalability
Off-Chain
Sidechains
Proof of Stake
Privacy
Security
Immature Technology
History
Electronic cash
David Chaum published a seminal paper in 1984 about electronic cash. The main problems that he tried to address are accountability and anonymity
Hashcash
Hashcash was created by Adam Back in 1997 as a system to control e-mail spam. When a user want to send an email they are required to compute a hash as a proof that they have spent a reasonable amount of computing resources before sending the e-mail.
Generate this Hash is a very demanding task, but for a normal user it's acceptable. This mechanism would instead destroy any kind of spambot because of the large volume of mails they send
While Hashcash is hard to generate is quite easy to verify. Verification is performed by the user who receives the e-mail.
b-money
Introduced by Wei Dai in 1998, it's a peer-to-peer network where money is created by solving computational puzzles such as hashcash
Bitcoin
In 2008 Satoshi Nakamoto, a nickname for an unknown person published the paper "Bitcoin: A Peer-to-Peer Electronic Cash System".
Satoshi Nakamoto introduced the term chain of blocks. This term over the years has now evolved into the word blockchain.
In 2009 Bitcoin goes live
Graph by Imran Bashir
Key Elements
Distributed systems
Blockchain at its core is a decentralized distributed system
Distributed systems are a computing paradigm whereby two or more nodes work with each other in a coordinated fashion in order to achieve a common outcome and it's modeled in such a way that end users see it as a single logical platform.
Imran Bashir
CAP Theorem
any distributed system cannot have Consistency, Availability, and Partition tolerance simultaneously
Consistency
is a property that ensures that all nodes in a distributed system have a single latest copy of data
Availability
means that the system is up, accessible for use, and is accepting incoming requests and responding with data without any failures as and when required
Partition tolerance
ensures that if a group of nodes fails the distributed system still continues to operate correctly
Graph by Hamzeh Khazaei
Eventual Consistency
Consistency is achieved over time, as a result of validation from multiple nodes. This process of validation is called a Consensus algorithm
Consensus
Consensus is a process of agreement between distrusting nodes on a final state of data
Imran Bashir
Byzantine Generals problem
The Byzantine Generals Problem is a situation where involved parties must agree in order to avoid failure, but where some of the involved parties are corrupt and disseminating false information
Proof of Work
A type of consensus mechanism that relies on proof that enough computational resources have been spent before proposing a new block to the network
The nodes that try to find new block are called miners.
Every time that a miner "find" a new block they get a reward (new money)
Mining difficulty increase over time
Problems?
Ecological
Political
Proof of stake
This algorithm works on the idea that for a node that has enough stake in the system, any malicious attempt would outweigh the benefits of performing an attack on the system
Proof of Stake (PoS) is a category of consensus algorithms for public blockchains that depend on a validator's economic stake in the network
Byzantine Nodes will lose the stake
Usually, the stake is the money
Image By https://blockgeeks.com/
Cryptography
Asymmetric cryptography
Public key cryptography
A private key is basically a randomly generated number that is kept secret
A public key is available publicly and published by the private key owner
Graph by Imran Bashir
Graph by Imran Bashir
Transactions
A transaction is the basic operation of a blockchain
The transaction lifecycle
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The user sends the transaction signing it the transaction using the private key
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The transaction is broadcasted to the Bitcoin network
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Mining nodes include this transaction in the next block to be mined
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Once a miner who solves the Proof of Work problem broadcasts the newly mined block to the network
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The nodes verify the block and propagate the block further, and confirmation starts to generate
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Finally, the confirmations start to appear in the receiver's wallet
Smart contracts
A Smart Contract a software that resides on the blockchain
Ethereum
By Ethereum Foundation [CC BY 3.0 (https://creativecommons.org/licenses/by/3.0)], via Wikimedia Commons
Ethereum is an open-source, public, blockchain-based distributed computing platform and operating system featuring smart contract (scripting) functionality
Wikipedia
Ethereum was initially described in a white paper by Vitalik Buterin, a programmer involved with Bitcoin Magazine, in late 2013 with a goal of building decentralized applications. Buterin had argued that Bitcoin needed a scripting language for application development. Failing to gain agreement, he proposed the development of a new platform with a more general scripting language
Wikipedia
The system went live on 30 July 2015
The DAO event
In 2016 a decentralised autonomous organisation called The DAO, a set of smart contracts developed on the platform, raised a record US$150 million in a crowd-sale to fund the project. The DAO was exploited in June when US$50 million in ether were claimed by an anonymous entity.
Wikipedia
The event sparked a debate in the crypto-community about whether Ethereum should perform a contentious "hard fork" to reappropriate the affected funds. As a result of the dispute, the network split in two. Ethereum continued on the forked blockchain, while Ethereum Classic continued on the original blockchain
Wikipedia
Bitcoin is created as an alternative to regular money, Ethereum is developed as a platform which facilitates peer-to-peer contracts
Key Elements
Types of accounts
Externally owned accounts
Contract accounts
Ether
Ethers are a reward for miners
But What's the purpose of Ethers?
All transactions on the Ethereum blockchain are required to cover the cost of computation they are performing
The cost is covered by something called gas
If you run out of gas during a transaction, any operation is reverted and the gas consumed is lost
Token
Tokens are specific kinds of Smart Contracts that let developers create new kind of money
ERC20
contract ERC20Interface {
function totalSupply() public constant returns (uint);
function balanceOf(address tokenOwner) public constant returns (uint balance);
function allowance(address tokenOwner, address spender) public constant returns (uint remaining);
function transfer(address to, uint tokens) public returns (bool success);
function approve(address spender, uint tokens) public returns (bool success);
function transferFrom(address from, address to, uint tokens) public returns (bool success);
event Transfer(address indexed from, address indexed to, uint tokens);
event Approval(address indexed tokenOwner, address indexed spender, uint tokens);
}ICO / ITO
Solidity
By Ethereum Foundation [CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons
Solidity is a statically-typed programming language designed for developing smart contracts that run on the EVM
Truffle Suite
References
Thanks!