Blockchain technology

Website: www.blockchainmemo.com @Blockchain_Memo

Why Blockchains change everything !

(and why Bitcoin is overrated)

http://www.blockchainmemo.com

https://twitter.com/Blockchain_Memo


!!1. What is Bitcoin/Blockchain? !2. Why is Blockchain more important? !3. Real World Applications & Opportunities




1. What is Bitcoin/Blockchain?

Bitcoins are digital tokens which can be used to transfer value without the need to use a bank. The Bitcoin whitepaper detailing the protocol was released by an anonymous entity, « Satoshi Nakamoto » on October 31st 2008. Although there were already academic experiments in the 1980’s and 1990’s on digital currencies, the democratisation of access to internet and electronics over the past decade now makes them much more accessible. !In order to work, Bitcoin depends on a central Blockchain.

Each 10 minutes on average, a new block is created

A Blockchain is a decentralised, publicly verifiable ledger which holds a record of all past messages exchanged between users of that Blockchain. Similar to a bank transaction, each message contains 2 identifiers, referring to the sender and the recipient of the message. Transactions are recorded in blocks.

Blockchain



https://bitcoin.org/bitcoin.pdf


1. What is Bitcoin/Blockchain?

Transaction 1 Transaction 2 Transaction 3

Block

A Blockchain consists of Blocks that record messages broadcast in that time period. !In the case of Bitcoin, the message that is recorded is a transfer of tokens (aka Bitcoins) from agent A to agent B, each party being represented by a public key ex. 1v15ewfevevevr4g234ff).

Blockchain

Transaction 1 !

(Agent A) 1DQ6XTBNCE1aorvM5G3Y3J9nwyr7KB9ohw !

sent !

0.05 XBT to !

(Agent B) 1MvpHP1UEwoDZgmVibivQHTpJ7pn7wu53J

Inside the transaction

At all times, it is possible to see how much funds are held on a single identifier. Bitcoins are always attached to an address and never exist on their own.




There’s a good chance you don’t own any Bitcoins. !There are probably a number of good reasons for that: - You don’t want to get hacked and lose your money. - Only drug dealers use Bitcoin right? - Bitcoin is too volatile whereas fiat currencies are safe.

2. Why is Blockchain more important?

You’re rightbut you’d be wrong not to consider the technology

Blockchain technology is the real game-changer: - It provides one unique protocol through which all participants can exchange tokens. - It uses cryptography to replace the need to trust humans adhering to processes. - The validity of the accounting ledger « Blockchain » is achieved by consensus.




What is Consensus?

2. Why is Blockchain more important?

The Blockchain’s validity is achieved by Proof of Work consensus through the activity of mining. In the case of Bitcoin, computers « miners » around the world compete to be the first to resolve the answer to a difficult mathematical equation. !The first miner to find the correct solution broadcasts this solution to the rest of the network, which can then easily calculate and affirm this solution is also valid. This all happens within the space of a few seconds and results in the creation of a Block. The miner is rewarded with new Bitcoins (Currently 25 XBT) and all transaction fees for transactions included in that block. !There can only be one valid Blockchain, which doesn’t depend on any centralised entity to be kept valid. Unlike a corporate entity’s accounting entries, no single entity is able to retroactively modify the Blockchain. !It’s extremely easy for anyone (human or robot) with knowledge of a specific Blockchain and a compatible client application to interact with it.




Idea 1: IPOs for Investment Banks - Create a coin for client companies which represents shares in your client’s business. Sell these shares directly to investors whilst keeping the benefit of a single ledger for all shares held.

3. Real World Applications & Opportunities

Idea 2: Money for states - Create an e-Euro which has all the benefits of Bitcoin’s liquidity whilst maintaining the stability offered by a state-backed currency.

Idea 3: Legal documents - Lawyers can publicly sign a message on a Blockchain, stating that they certify a specific set of documents. This would replace paper certification, speed up the process and make it quicker for authorities to check compliance.

Idea 4: Meshnets / Electrical Grids - Blockchains can be used to operate « smart contracts ». For example, in an off-grid village, locals can set up a local grid and use a blockchain to exchange money and route electricity automatically between houses with excess electricity and those that need it.




Blockchains are: - Decentralised public ledgers - Extremely difficult to forge - Easy to interact with if a client application is available - Simple ways of creating a liquid token that represents an underlying asset

Summary

Blockchains can be used to: - Reduce fraud by removing humans from operations - Diminish the costs of operating the financial and monetary system - Provide better ways of exchanging value - Operate the Internet of Things !

And that’s just the beginning…




Contact: !

!LinkedIn: Mohamad El Boudi !Email: [email protected] Tel: +44 (0)7 918 929 471 !Website: www.blockchainmemo.com !Twitter: @Blockchain_Memo

To find out more about the Blockchain’s private applications…



http://uk.linkedin.com/in/melboudi

mailto:[email protected]


Technology

Blockchain technology