Mastering Blockchain · 2nd Edition by Bashir, Imran -- Read -- Imperial Library of Trantor

Index

Title Page Copyright and Credits

Mastering Blockchain Second Edition

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Preface

Who this book is for What this book covers To get the most out of this book

Download the example code files Download the color images Conventions used

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Blockchain 101

The growth of blockchain technology Distributed systems The history of blockchain and Bitcoin

Electronic cash Blockchain

Blockchain defined

Peer-to-peer Distributed ledger Cryptographically-secure Append-only Updateable via consensus

Generic elements of a blockchain

How blockchain works How blockchain accumulates blocks

Benefits and limitations of blockchain Tiers of blockchain technology Features of a blockchain

Types of blockchain

Distributed ledgers Distributed Ledger Technology Public blockchains Private blockchains

Semiprivate blockchains Sidechains Permissioned ledger

Shared ledger Fully private and proprietary blockchains Tokenized blockchains Tokenless blockchains

Consensus

Consensus mechanism Types of consensus mechanisms Consensus in blockchain

CAP theorem and blockchain Summary

Decentralization

Decentralization using blockchain Methods of decentralization

Disintermediation Contest-driven decentralization

Routes to decentralization

How to decentralize The decentralization framework example

Blockchain and full ecosystem decentralization

Storage Communication Computing power and decentralization

Smart contracts Decentralized Organizations

Decentralized Autonomous Organizations Decentralized Autonomous Corporations Decentralized Autonomous Societies Decentralized Applications (DApps) Requirements of a Decentralized Application Operations of a DApp

DApp examples

KYC-Chain OpenBazaar Lazooz

Platforms for decentralization

Ethereum MaidSafe Lisk

Summary

Symmetric Cryptography

Working with the OpenSSL command line Introduction

Mathematics

Set Group Field A finite field Order An abelian group Prime fields Ring A cyclic group Modular arithmetic

Cryptography Confidentiality Integrity Authentication

Entity authentication Data origin authentication

Non-repudiation Accountability

Cryptographic primitives

Symmetric cryptography

Stream ciphers Block ciphers

Block encryption mode Electronic Code Book Cipher Block Chaining Counter mode Keystream generation mode Message authentication mode Cryptographic hash mode

Data Encryption Standard Advanced Encryption Standard

How AES works

Summary

Public Key Cryptography

Asymmetric cryptography

Integer factorization Discrete logarithm Elliptic curves

Public and private keys

RSA

Encryption and decryption using RSA Elliptic Curve Cryptography

Mathematics behind ECC Point addition Point doubling

Discrete logarithm problem in ECC

RSA using OpenSSL RSA public and private key pair

Private key Public key Exploring the public key

Encryption and decryption

Encryption Decryption

ECC using OpenSSL

ECC private and public key pair Private key Private key generation

Hash functions

Compression of arbitrary messages into fixed-length digest Easy to compute Preimage resistance Second preimage resistance Collision resistance Message Digest Secure Hash Algorithms

Design of Secure Hash Algorithms Design of SHA-256 Design of SHA-3 (Keccak) OpenSSL example of hash functions Message Authentication Codes MACs using block ciphers Hash-based MACs

Merkle trees Patricia trees Distributed Hash Tables Digital signatures

RSA digital signature algorithm

Sign then encrypt Encrypt then sign

Elliptic Curve Digital Signature Algorithm

How to generate a digital signature using OpenSSL ECDSA using OpenSSL Homomorphic encryption Signcryption Zero-Knowledge Proofs Blind signatures Encoding schemes

Financial markets and trading

Trading Exchanges

Orders and order properties Order management and routing systems Components of a trade The underlying instrument General attributes Economics Sales Counterparty

Trade life cycle Order anticipators Market manipulation

Summary

Introducing Bitcoin

Bitcoin

Bitcoin definition Bitcoin – a bird's-eye view

Sending a payment to someone

Digital keys and addresses

Private keys in Bitcoin Public keys in Bitcoin Addresses in Bitcoin

Base58Check encoding Vanity addresses

Multisignature addresses

Transactions

The transaction life cycle

Transaction fee Transaction pools

The transaction data structure

Metadata Inputs Outputs Verification The script language Commonly used opcodes

Types of transactions

Coinbase transactions Contracts

Transaction veriﬁcation

Transaction malleability

Blockchain

The structure of a block The structure of a block header The genesis block

Mining

Tasks of the miners Mining rewards Proof of Work (PoW) The mining algorithm The hash rate Mining systems

CPU GPU FPGA ASICs

Mining pools

Summary

Bitcoin Network and Payments

The Bitcoin network Wallets

Non-deterministic wallets Deterministic wallets Hierarchical Deterministic wallets Brain wallets Paper wallets Hardware wallets Online wallets Mobile wallets

Bitcoin payments Innovation in Bitcoin

Bitcoin Improvement Proposals (BIPs) Advanced protocols Segregated Witness (SegWit) Bitcoin Cash Bitcoin Unlimited Bitcoin Gold Bitcoin investment and buying and selling bitcoins

Summary

Bitcoin Clients and APIs

Bitcoin installation

Types of Bitcoin Core clients

Bitcoind Bitcoin-cli Bitcoin-qt

Setting up a Bitcoin node Setting up the source code Setting up bitcoin.conf Starting up a node in testnet Starting up a node in regtest Experimenting with Bitcoin-cli Bitcoin programming and the command-line interface

Summary

Alternative Coins

Theoretical foundations

Alternatives to Proof of Work

Proof of Storage Proof of Stake (PoS)

Various stake types

Proof of coinage Proof of Deposit (PoD) Proof of Burn Proof of Activity (PoA) Nonoutsourceable puzzles

Difficulty adjustment and retargeting algorithms

Kimoto Gravity Well Dark Gravity Wave DigiShield MIDAS

Bitcoin limitations

Privacy and anonymity

Mixing protocols Third-party mixing protocols Inherent anonymity

Extended protocols on top of Bitcoin

Colored coins Counterparty

Development of altcoins

Consensus algorithms Hashing algorithms Difficulty adjustment algorithms Inter-block time Block rewards Reward halving rate Block size and transaction size Interest rate Coinage Total supply of coins

Namecoin

Trading Namecoins Obtaining Namecoins Generating Namecoin records

Litecoin Primecoin

Trading Primecoin Mining guide

Zcash

Trading Zcash Mining guide

Address generation GPU mining

Downloading and compiling nheqminer

Initial Coin Offerings (ICOs) ERC20 tokens

Summary

Smart Contracts

History Definition Ricardian contracts

Smart contract templates Oracles Smart Oracles Deploying smart contracts on a blockchain The DAO

Summary

Ethereum 101

Introduction

The yellow paper

Useful mathematical symbols

Ethereum blockchain

Ethereum – bird's eye view The Ethereum network

Mainnet Testnet Private net

Components of the Ethereum ecosystem

Keys and addresses Accounts

Types of accounts

Transactions and messages

Contract creation transaction Message call transaction Messages Calls Transaction validation and execution The transaction substate State storage in the Ethereum blockchain The world state The account state Transaction receipts

Ether cryptocurrency / tokens (ETC and ETH) The Ethereum Virtual Machine (EVM)

Execution environment Machine state The iterator function

Smart contracts

Native contracts

Summary

Further Ethereum

Programming languages

Runtime bytecode

Opcodes and their meaning Arithmetic operations Logical operations Cryptographic operations Environmental information Block information Stack, memory, storage, and ﬂow operations Push operations Duplication operations Exchange operations Logging operations System operations

Blocks and blockchain

The genesis block The block validation mechanism

Block finalization

Block difficulty Gas

Fee schedule

Forks in the blockchain Nodes and miners

The consensus mechanism

Ethash

CPU mining GPU mining Benchmarking Mining rigs Mining pools

Wallets and client software

Geth Eth Pyethapp Parity Light clients Installation Eth installation Mist browser Geth The geth console Funding the account with bitcoin Parity installation Creating accounts using the parity command line

APIs, tools, and DApps

Applications (DApps and DAOs) developed on Ethereum Tools

Supporting protocols

Whisper Swarm

Scalability, security, and other challenges Trading and investment

Summary

Ethereum Development Environment

Test networks Setting up a private net

Network ID The genesis file Data directory

Flags and their meaning Static nodes

Starting up the private network

Running Mist on private net Deploying contracts using Mist Block explorer for private net / local Ethereum block explorer

Summary

Development Tools and Frameworks

Languages

Compilers

Solidity compiler (solc)

Installation on Linux Installation on macOS

Integrated Development Environments (IDEs)

Remix

Tools and libraries

Node version 7 EthereumJS

Ganache MetaMask Truffle

Installation

Contract development and deployment

Writing Testing

Solidity language

Types

Value types

Boolean Integers Address

Literals

Integer literals String literals Hexadecimal literals

Enums Function types

Internal functions External functions

Reference types

Arrays Structs Data location Mappings

Global variables Control structures

Events Inheritance Libraries Functions

Layout of a Solidity source code ﬁle

Version pragma Import Comments

Summary

Introducing Web3

Web3

Contract deployment POST requests The HTML and JavaScript frontend

Installing web3.js

Example Creating a web3 object Checking availability by calling any web3 method Contract functions

Development frameworks

Truffle

Initializing Truffle Interaction with the contract Another example An example project – Proof of Idea

Oracles Deployment on decentralized storage using IPFS

Installing IPFS

Distributed ledgers

Summary

Hyperledger

Projects under Hyperledger

Fabric Sawtooth Lake Iroha Burrow Indy Explorer Cello Composer Quilt

Hyperledger as a protocol The reference architecture

Requirements and design goals of Hyperledger Fabric

The modular approach Privacy and confidentiality Scalability Deterministic transactions Identity Auditability Interoperability Portability Rich data queries

Fabric

Hyperledger Fabric

Membership services Blockchain services Consensus services Distributed ledger

The peer to peer protocol Ledger storage Chaincode services Components of the fabric Peers Orderer nodes Clients Channels World state database Transactions Membership Service Provider (MSP) Smart contracts Crypto service provider Applications on blockchain Chaincode implementation The application model Consensus in Hyperledger Fabric The transaction life cycle in Hyperledger Fabric

Sawtooth Lake

PoET Transaction families Consensus in Sawtooth The development environment – Sawtooth Lake

Corda

Architecture

State objects Transactions Consensus Flows

Components

Nodes The permissioning service Network map service Notary service Oracle service Transactions Vaults CorDapp

The development environment – Corda

Summary

Alternative Blockchains

Blockchains

Kadena Ripple

Transactions

Payments related Order related Account and security-related

Interledger

Application layer Transport layer Interledger layer Ledger layer

Stellar Rootstock

Sidechain Drivechain

Quorum

Transaction manager Crypto Enclave QuorumChain Network manager

Tezos Storj MaidSafe BigchainDB MultiChain Tendermint

Tendermint Core Tendermint Socket Protocol (TMSP)

Platforms and frameworks

Eris

Summary

Blockchain – Outside of Currencies

Internet of Things

Physical object layer Device layer Network layer Management layer Application layer IoT blockchain experiment

First node setup Raspberry Pi node setup

Installing Node.js

Circuit

Government

Border control Voting Citizen identification (ID cards) Miscellaneous

Health Finance

Insurance Post-trade settlement Financial crime prevention

Media

Summary

Scalability and Other Challenges

Scalability

Network plane Consensus plane Storage plane View plane Block size increase Block interval reduction Invertible Bloom Lookup Tables Sharding State channels Private blockchain Proof of Stake Sidechains

Subchains Tree chains (trees) Block propagation Bitcoin-NG Plasma

Privacy

Indistinguishability Obfuscation Homomorphic encryption Zero-Knowledge Proofs State channels Secure multiparty computation Usage of hardware to provide confidentiality CoinJoin Confidential transactions MimbleWimble Security

Smart contract security

Formal verification and analysis Oyente tool

Summary

Current Landscape and What's Next

Emerging trends

Application-specific blockchains (ASBCs) Enterprise-grade blockchains Private blockchains Start-ups Strong research interest Standardization Enhancements Real-world implementations Consortia Answers to technical challenges Convergence Education of blockchain technology Employment Cryptoeconomics Research in cryptography New programming languages Hardware research and development Research in formal methods and security Alternatives to blockchains Interoperability efforts Blockchain as a Service Efforts to reduce electricity consumption

Other challenges

Regulation Dark side

Blockchain research

Smart contracts Centralization issues Limitations in cryptographic functions Consensus algorithms Scalability Code obfuscation

Notable projects

Zcash on Ethereum CollCo Cello Qtum Bitcoin-NG Solidus Hawk Town-Crier SETLCoin TEEChan Falcon Bletchley Casper

Miscellaneous tools

Solidity extension for Microsoft Visual Studio MetaMask Stratis Embark DAPPLE Meteor uPort INFURA

Convergence with other industries Future Summary

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