Forking an altcoin
from Bitcoin

Toptal academy Blockchain lectures #4

2018-03-05

ivan.voras@toptal.com

Today's agenda

• Descriptions of minimal necessary changes to fork a cryptocurrency from Bitcoin
• Live demo

What is a cryptocurrency blockchain?

• Genesis block
• Consensus rules
• Network protocol
• Peers / clients (miners + users)

How to fork a cryptocurrency

1. Fork the code itself (e.g. Github)
2. Change the genesis block (& hash)
3. Change network ports
4. Change seed servers
5. Change checkpoints
6. Adjust difficulties
7. ???
8. Profit

In Bitcoin and cryptocurrencies forked from Bitcoin, most of this is in chainparams.c / chainparams.h

Mining the Genesis block

Needs to be done "manually" by adding code, because mining was removed from the official Bitcoin Core software.

Difficulty statement:

if block_hash < difficulity_target: return True

nBits: compact representation of the difficulty target

0x1d00ffff

number of 0 bytes+3

prefix

means: starts with 00ffff, and 0x1d-3=26 zero bytes

Mining the Genesis block

So if nBits is 0x1d00ffff, the difficulty statement is:

if block_hash < 0x00000000ffff0000000000000000000000000000000000000000000000000000: true

Because of the nBits format, the "easiest" difficulty still has 3 bytes fixed.

In chainparams.cpp, around line 150:

srand(time(NULL));
genesis = CreateGenesisBlock(1520173282, rand(), 0x1f00ffff, 1, 50 * COIN);
consensus.hashGenesisBlock = genesis.GetHash();
while (!CheckProofOfWork(genesis.GetHash(), genesis.nBits, consensus.powLimit)) {
    genesis.nNonce++;
    if (genesis.nNonce % (1024*1024) == 0) {
      printf("Genesis mining trying %u\r", genesis.nNonce);
    }
}
printf("@@@ mainnet new genesis block hash: %s\n@@ merkle root: %s\n@@ nonce: %x\n", consensus.hashGenesisBlock.GetHex().c_str(), genesis.hashMerkleRoot.GetHex().c_str(), genesis.nNonce);
assert(consensus.hashGenesisBlock == uint256S("0x1cae3ba472a97ef60cb3e9b72cc0588142574db4b8a0f0680091ddadb998a1ea"));
assert(genesis.hashMerkleRoot == uint256S("0xebe85c5648c26076e6db053964c402882b0ed89393d23ab978f1795e35d0b10d"));

mining :)

lower difficulty (less leading 0s),

also needs lowering the powLimit

In chainparams.cpp, at beginning:

bool CheckProofOfWork(uint256 hash, unsigned int nBits, uint256 powLimit)
{
  bool fNegative;
  bool fOverflow;
  arith_uint256 bnTarget;
  bnTarget.SetCompact(nBits, &fNegative, &fOverflow);
  // Check range
  if (fNegative || bnTarget == 0 || fOverflow || bnTarget > UintToArith256(powLimit))
      return false;
  // Check proof of work matches claimed amount
  if (UintToArith256(hash) > bnTarget)
      return false;
  return true;
}

Adapted from pow.cpp

Helpful links

• https://github.com/bitcoin/bitcoin - the Bitcoin repo
• https://github.com/bitcoin/bitcoin/blob/master/doc/build-unix.md -- building Bitcoin on Linux
• https://github.com/bitcoin/bitcoin/blob/master/doc/build-windows.md -- building Bitcoin on Windows
• https://github.com/pooler/cpuminer -- a simple CPU miner
• https://bitcoin.org/en/developer-reference#target-nbits -- explanation of nBits for genesis block mining

Next: live demo

Notes

• Addresses begin with 5 in this version/fork, e.g. 5L1k8Pn6mRXv96C9AH6v7sQ1r2WWcwiZyU 
• Start bitcoind with:
  ./bitcoind -datadir=/home/ivoras/btcdata/ -server -rpcuser=user -rpcpassword=password -rpcallowip=10.0.0.0/24 -debug=1 -prematurewitness
• Use the same rpcuser / rpcpassword parameters (or a config file) to issue bitcoin-cli commands (like getnewaddress)
• Start minerd with:
  minerd -a sha256d -O user:password -o http://127.0.0.1:8332 --coinbase-addr=5L1k8Pn6mRXv96C9AH6v7sQ1r2WWcwiZyU
• Diff for chainparams.cpp:
  https://gist.github.com/ivoras/6e18ed32151d579b428e9dd00ad2f285

Note on addresses

• Bitcoin addresses are generated by hashing the public key in a very specific way. See https://en.bitcoin.it/wiki/Address and https://en.bitcoin.it/wiki/Technical_background_of_version_1_Bitcoin_addresses for the details.
• Version number is prefixed and a checksum appended
• The result is converted to a series of printable characters in "base58check" encoding: https://en.bitcoin.it/wiki/Base58Check_encoding 
• The "version number" prefix influences the result so that the first character of the generated address is "1" -- if a different character is desired, the correct prefix needs to be found.
• base58 collects several input bytes into several output bytes, so the prefix influences and is influenced by the next bytes to generate the resulting ASCII prefix of the address string.

Build screenshot

debug.log (in datadir)

Make one yourself...

Homework

• Fork a cryptocurrency from Bitcoin (or any other template, if you're feeling adventurous)
• Mine some blocks, e.g. by using the cpuminer ("minerd")
• Inspect the blocks and the transactions
• Explore, play with it.