Chowdhury is a billionaire. Since childhood, he has a special interest in his rare paintings. It's like a small museum with artwork collected over its years. These problems are, there is a lot of trouble in collecting both these things and collecting them. Because there are many types of people who are aware of these, sometimes they have a large number of organized crime or accidents. Chowdhury does not want to get in trouble when he comes to his old age. So, for a while, he wondered, is there a way in which all the art of his collection can be preserved in such a way that,
If you want to buy a new art, then first it is original, so that it can be verified automatically. Financial transactions and legal matters can be arranged at home, without any hassle, silent and in the shortest possible time.
If one sells an art from his collection, then the transaction happens in a transparent way.
If a thief accidentally stole an art from his shop and sold it outside, then he might be caught by the law enforcers for selling stolen items. And if the thief escapes, the person who bought it has been caught and stolen for the purchase of things.
Chowdhury's problem is actually a lot of old problems. When it comes to talking about economics or very specific, the currency system content will come out. The knowledge of my economy is not very good, as an engineer, I try to interpret the same way as everyone else understands.
Current financial system
Many years ago people used to deal with goods according to which they needed. There is a problem, let us take a sack of Rahim Mia from the vegetable farmer, in return, he will give a basket of vegetables. Karim Mia has a sackable sack rice, but vegetables do not need it. So there is no exchange here.
In this way, everyone thought, one needs something that is worth to everyone, such as Gold. Thus, many years ago, Gold is still considered as a unit of asset measurement. Earlier it was a direct gold transaction, it once became a bank currency system for human needs. Thus, in different countries different coins like money, dollars, pounds, euro etc. came. According to the needs of the country's economy, the government or central bank can release these coins in the market for the use of the people. Bank or banking system has been created to manage matters related to financial transactions or asset sharing of individuals or organizations in accordance with the laws of the country.
With the example of what we are talking about, explain the role of the bank with an example.
Suppose, Rahim should send a money to Karim Sahib for any work. But the problem is, Karim's reputation of trading is not very good. Rahim knows, there could be problems proving that there was a transaction in the case of cash transactions. Maybe Karim can deny the money. What is the way A trustworthy establishment, whose work is to be leased out, That means, the money from Rahim's account will go to Karim's account through another organization, and the company will keep a record of that transaction so that no one can question any of these two people regarding this transaction. The middle of this company is the bank.
Now, what would have happened if Rahim could send the money directly to Karim Sahib by no means if he did not go to a third party or bank? Here we are thinking of a system where there will be direct transactions of any resources which have full financial or financial value through a more transparent process automatically and any type of hacking, data theft or change is straightforward, where no two numbers are almost impossible.
So the name of this technology is the Blockchain, which is now seen as the future banking technology of the world, and some of the dominant banks in some influential countries are already investing billions of dollars behind this technology. For the blockchain system and for that the first cryptocurrency Bitcoin is designed and developed by the name Satoshi Naakamoto The word 'who' is probably not right here, it is estimated that Satoshi is a group of hackers whose original identity is unknown.
What is blockchain?
The blockchain is a fairly stable, distributed and disinfected laser, which is a completely unstructured and ordered array of blocks by combining all the encrypted data of transactions in the financial and resources of the world in a fair amount of time. It's a little hard to understand in one sentence. That's why we tried to break down a little bit. The blockchain I'm talking about in my writing is that Bitcoin Blockchain. There are many blockbusters for more work. Bitcoin will come in that discussion a little later.
In order to record all transactions in the bank, all branches have a large size book. If you want to see it, it is best to go to the government bank. The banks which use banking software, have these records in the database. Maybe, that old book is also there. This big size sheet tells laser. There must be an entry for the bank's laser entry for a valid transaction. The blockchain is such a laser, where there are many such blocks in one after another.
All the data inside every block is estimated to have been transit all over the world in the last 10 minutes. This data is open but encrypted. Everyone can see this data but to get a private key to read. Rahim is here to trance
Each block of backbench is completely irreversible. Once a block is added to the chain, it is impossible to change anything. Why it is impossible to come to technical explanation later.
The blocks are sitting in the order of their creation as well. Every block knows that there are no blocks. Thus, a block connected with another.
Blockchain distributed and discretized system, that is, it has absolutely carbon copy of thousands of servers around the world. So if one or a hundred servers or computers are nested together, there will be no blockchain.
Crypto-currency
Like our current currency, cryptocurrency is a type of currency or exchange medium. That is, the work that can be done with traditional coins, such as dollars, pounds, money etc., can be done by cryptocurrency. This crypto conferences used for transactions through blockchain technology. There are many such coins, such as Bitcoin, BitCash, Monaro, Lighcoin etc. The price of our coins, such as dollars, lbs, and so on, fluctuates from time to time, so also, that is, buying/selling price fluctuates. We'll just talk about Bitcoin, this is the most familiar cryptocurrency.
The first thing to remember here is that this currency and its technology have been created because the currency system or economic system is not a member of a person, group or organization. Someone may not manipulate it according to their own needs. And the whole process has been created so that the whole thing is absolutely transparent, and no one can take extra advantage from this system.
How Bitcoin is made?
The current regulator is the government and central bank of any country. Considering the central bank may be private or private like the United States, it can create a new currency considering the country's economy and many other things. The new banknotes can be printed directly in Bengal. That is, the regulator can do it on their own, in case of loss of profits, they do not sweat their heads, but they often leave them. For example, we have inflation due to printing more money than required in our country.
But cryptocurrencies are completely different. Here the new currency or bitcoin comes every 10 minutes to solve a cryptographic puzzle. Simply put, just keep a little head cool here :)
Those who know encryption need to know the SHA256 encryption. Those who are not known, it will be known, if any data is encrypted on SHA256 then there is a hash for that data. For the purpose of understanding the hash, "000001beeca3785d515897041af0a7" is something like this. Now if there is a slight change from this data, then a different hash can be found. That means, if the encryption is done then the hash will always be the same for a specific data, and the same will be the same on everyone's computer.
Now notice, the above hash that I used there is 5 zero at the beginning. It's deliberate. And that's the cryptographic puzzle that I said earlier. Confused?
There are numerous transactions in the world of Bitcoin in blockchain every moment. After adding a new block in Blockchain, approximately 10 minutes of pending transaction data, Bitcoin, all the miners on the system get into the computer. What is the miner again? For the sake of understanding, mine means we ourselves and we are sitting with the computer to solve puzzles. Now the target of us or miners is to find out a hash of the pattern that we have at the moment, the hash of the previous block, and another with Random Number (here it is called nonce = Number Used Once). Why this 5th Zero? It is said, the difference level, that is, how many zeros will sit at the beginning, it's actually hard to solve the puzzle.
In this way, thousands of miners from all over the world have been competing to find the desired hash on their computers. This process does not really win with any special algorithm or intelligence. In the system, one should apply nonce after checking if the pattern hash has been found.
In this contest, the miner can first find out this hash that the champion Finding a hash is to create a new block for a new blockchain. Not nice? Winner of the winner gets 12.5 Bitakayena as the prize to be the champion. Then the rest? The rest of the miner who could not win, they too will get their hash in a very short time. Their job is to verify that the results of the winning miner are correct. Thus, perhaps 51.7% of the vermilion was verified, then the new block was added to the Blockchain as a test block. A block that was added a little earlier is shown below.
And this is how a new currency or bitcoin is created in a system with equal facilities for everyone and everyone's participation. If anyone wants to buy Bitcoin, they can buy directly from miners, or buy from Bitcoin sites for trading.
Blockchain Security
Hacking
As mentioned earlier, the biggest feature of Blockchain is that a block has been added to Blockconie, which means that the block is completely unchanged. There is no change in the block anyhow. In other words, hacking is almost impossible. Why Impossible?
The reason is funny First, there is a lot of transaction records inside a block. These are all encrypted data. That means it is impossible to read data inside a transaction without a private key. Suppose a reputable hacker made this impossible possible. Suppose hacker cracks at 10000 numbers and changes a transaction record as needed.
what will happen now? We already know that every block has hash blocks of its previous block. This is the previous hash, the blockage transaction data, and nonce matching but the SHA256 hash of that block. So, a huge problem will arise. The problem is that the hacker will be changed to the SHA256 hash block of the block within the 10000 block. Switching the hash means that the block is immediately invalidated. Before the hacking of this block has 10001 blocks, so 10000 blocks are now invalid due to the new hash of 10000 blocks. When 10001 is nested then 10002 last. In this way, from one block of chain reactions to 10000 blocks to this point, all the blocks that are blocked will be blocked or invalid.
So if you have to hack into the blockchain then the blocker hacker will have to reconstruct all the blocks (currently 499982 number blocks) from the changed 10000 block or fix the hash and every block will have to be verified with about 52% of the miner. Now we know from the previous information that the problem here is that the hacker has time to complete the entire process of approximately 10 minutes, ie the time between adding a new block. Where a block can be mined in 10 minutes, it will not be wrong to say that many blocks are not so impossible to mine at this time.
Data security
Transaction data in BlockChain is quite safe. A bank's banking software may have one or more servers. If hackers can hack that server then the bank will be in danger, customers who are in the chase will be in severe trouble. But the Blockchain is Distributed and Dissolved. In other words, there are thousands of data centers, computers in the whole blockchain with the same data. In spite of all the destruction of a system, the system will run, it is not actually possible. To be able to make the Internet down the whole world to be possible. The whole data is encrypted, so there is no doubt about the security of the data.
However, we know how technology works, such as Blockchain and Bitcoin, and how it works, to solve the anxiety of Chowdhury. Hope to discuss the issues of how Chowdhury's problems are resolved through this technology will be discussed in next phase.