Module (Blockchain & Cryptocurrency).pptx

Blockchain & Cryptocurrency

1.  Blockchain Dr. Bahar Ali
Assistant Professor (CS ), Institute of Management Sciences, Peshawar.

2. Contents – Module A What is Blockchain? Distributed P2P Networks Hashing Algorithm Immutable Ledger What is Mining? Consensus Protocol

3. Hashing Algorithm

4. Cryptography & Encryption Cryptography: A broad field that involves the study of secure communication techniques in the presence of adversaries. Includes various methods for encrypting and decrypting messages, ensuring data integrity, and authenticating the identity of communicating entities. Encryption: The process of converting plaintext (readable data) into ciphertext (appears as random characters) using an algorithm and a key. The purpose is to protect sensitive information from unauthorized access. Two types of encryption Symmetric and Asymmetric

5. Symmetric Symmetric Encryption: Uses a single shared key for both encryption and decryption Examples: AES, DES, Triple DES Process: A single secret key is generated and shared securely between the parties. Sender encrypts the plaintext using the shared key to get a ciphertext. Receiver decrypts the ciphertext using the same shared key to get the plaintext back.

6. Symmetric

7. Asymmetric Encryption Asymmetric Encryption: U ses a pair of public and private keys. Information encrypted with the public key can only be decrypted with the corresponding private key, and vice versa. Example: RSA (Rivest–Shamir–Adleman). Process: Public-private key pair is generated The public key is shared with everyone, while the private key is kept secret. The sender encrypts the message using the public/ private key. The receiver decrypts the message using corresponding private/public key.

8. Symmetric

9. What a Hash is? Hashing: G enerate a fixed-size hash value (digest) from input data of any size. Hashing is a one-way, irreversible process. Hashing is used to verify the data integrity Example: SHA-256 (Secure Hash Algorithm 256-bit). Process: The algorithm generates a fixed-size hash value as a unique identifier for data. To verify integrity, the algorithm is reapplied, producing a new hash. A match indicates data integrity, while differences suggest the data has been altered or tampered with.

10. Symmetric

11. What a Hash is? A fixed size numeric representation of the contents of a message. Also known as message digest Computed by a hash function (One way cryptography). Hash function has no key, so it is not reversible. For same message you always get the same hash Computationally infeasible to find two messages that hash to the same digest.

12. Encryption vs Hashing Both hashing and encryption involve transforming data, but they serve different purposes. Encryption is a reversible process, while the hashing is irreversible. Symmetric encryption is used for efficient data transmission . Asymmetric encryption is used for secure key exchange Hashing is used for data integrity verification

13. Encryption vs Hashing

14. Confidentiality using Asymmetric

15. Authenticity using Asymmetric

16. Confidentiality and Authenticity

17. Digital Signature

18. What a Hash is? Hash Properties: Computationally efficient Deterministic ( Same input same output hash code ) Pre-image resistant ( Finding another message that has a specific hash output) Collision Resistant (large output space etc.) Avalanche Effect (Drastically/ dramatically changes with minimal change in the input)

19. Hashing Algorithm The five requirements of Hash Algorithm- One Way Avalanche Effect Withstand Collisions Fast Computation Deterministic Data Encrypted   Data ABC 845

20. Document, Audio , Video etc. Hashing Algorithm SHA256 5819E961F19967B4ECB2429085E17909CFFD4DCB6267D0067F6CAEC22150A7B1 This has 64 hexadecimal characters . Each character is of 4 bits. So in total it has 64* 4 bits i.e. 256 bits .

21. Hashing Algorithm Block No.-1 Data Hash:0000D8C42 Prev Hash:000000000 Fingerprint Block Fingerprint Authentication is used to recognize/ identify an individual in a group of people Likewise, a hash of a block is used to recognize/ identify a block in the Blockchain

22. Hashing Algorithm Block No.- Data Hash: Prev Hash: SHA 256

23. Hashing Algorithm Block No.-1 Data Hash:0000D8C42 Prev Hash:000000000 Block

24. Hashing Algorithm Block No.-1 Data Hash:0000D8C42 Prev Hash:000000000 Block No.-2 Data Hash: 00003A459 Prev Hash:

25. Hashing Algorithm Block No.-1 Data Hash:0000D8C42 Prev Hash:000000000 Block No.-2 Data Hash:00003A459 Prev Hash: 0000D8C42

26. Hashing Algorithm Block No.-1 Data Hash : 0000D8C42 Prev Hash:000000000 Block No.-2 Data Hash:00003A459 Prev Hash : 0000D8C42 Block No.-3 Data Hash: 00003D45F Prev Hash: 00003A459 Genesis Block

27. Hashing Algorithm Demo Online demonstration (Hash, Block and Blockchain) https://andersbrownworth.com/blockchain/ Running your Node Server  https://github.com/anders94/blockchain-demo/

28. Immutable Ledger

29. Immutable Ledger Institution Sales Deed Money House Consider you want to buy a house for yourself. You need cash, and a contract Submit the documents to government institution for registration The information is recorded either in a register book or centralized database

30. Immutable Ledger Institution Maintain Register Centralized Database Register book: The register can be destroyed Easily altered by someone Centralized database: The record can be hacked and changed The government employee can change the record Let’s check, the Immutable register on Blockchain

31. Immutable Ledger A C E F D B Hacker Attacks Corrupted If the hacker changes block C All the blocks after block C will be corrupted

32. What is a P2P network?

33. What is a Centralized Network? Server Client Client Client Client Client Server Model Data stored on Server Client requests data from Server Server sends client the required data Hacker can easily hack the Server and corrupt the data i.e. Banks, Social Networks, etc.

34. What is a Centralized Network? Server Client Client Client Client Request

35. What is a Centralized Network? Server Client Client Client Client Respond

36. What is a centralized network? Server Client Client Client Client

37. Distributed P2P network No client and no server All peer are equal The data is stored with multiple peers Peers directly request data from each other Hacker must hack all the peer simultaneously, to corrupt the data, which is almost impossible

38. Distributed P2P network A B C E F Peer Peer Peer Peer Peer

39. Distributed P2P network in Blockchain

40. Distributed P2P network A B C E F

41. Distributed P2P network A B C E F A mines a block and add it to Blockchain

42. Distributed P2P network A B C E F

43. Distributed P2P network A B C E F

44. Distributed P2P network A B C E F

45. Distributed P2P network A B C E F

46. Distributed P2P network Q)Why we need Distributed P2P network in Blockchain? To resist tempering in a Blockchain To recover tempered data

47. Distributed P2P network How data is recovered using Distributed P2P network. If hacker change a block of a specific node The change is reflected in the succeeding blocks Thus, it will invalidate all the succeeding blocks However, if a hacker is smarter, he will also change the succeeding blocks The other peers will update the node that your blocks are changed The chain will be recovered back

48. Distributed P2P network A C E F D B Concept of Immutability in Distributed P2P Network A C E F D B Hacker Attacks Corrupted Node 1 Node 2

49. Distributed P2P network A B C E F

50. Distributed P2P network A B C E F

51. Distributed P2P network A B C E F

52. Distributed P2P network A B C E F

53. Distributed P2P network A B C E F

54. Hashing Algorithm Demo Online demonstration (Distributed Blockchain) https://andersbrownworth.com/blockchain/ Running your Node Server  https://github.com/anders94/blockchain-demo/