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- Q: How big is the blockchain today?
- A: 415'000 blocks, 70 Gigabytes.
- Q: Where is the blockchain stored?
- A: On all the nodes participating in the Bitcoin p2p network.
- Implicit consensus is achieved by all nodes following the same rules (and incentives).
- Q: What kind of encryption is Bitcoin using?
- A: none (rather hashing and signing).
- Q: What is the blockchain data structure?
- A: A list of blocks, connected with hashes. A block's hash verifies the integrity of the previous
- block's content.
- A block contains a Merkle-tree, which is a binary tree, again connected with hashes. The leaves
- of the tree contain each one transaction.
- Q: What are other cases of Merkle trees?
- A: git (version control system), ZFS (file system), Cassandra (NoSQL database)
- Q: How is prevented that a bitcoin is copied and spent twice (double spend)?
- A: New transactions are only valid if their input address has not been redeemed yet,
- i.e. is not part of the block chain.
- Q: Who decides if a transaction is valid and will be stored in the blockchain?
- A: For bitcoins the miners decide ("unpermissioned ledger"). Other blockchains
- introduce specific nodes that are authorized to create new blocks ("permissioned ledger").
- Q: What can blockchains be used for apart from currencies?
- A: Trading of digital property (smart property, smart contracts).
- Voting, elections, Internet of Things.
- Q: Who is creating/mining new blocks in non-monetary blockchains? What is their incentive?
- A: Incentivicing peers to act legitimite is difficult to accomplish. A few ideas are around:
- - Create blocks not based on "proof of work" but e.g. "proof of stake". Stakeholders would create
- new blocks, without doing lots of calculations.
- Unclear how to select the next "miner". Unclear how to incentivize her.
- - Store non-monetary blockchains *inside* the bitcoin blockchain. This might be called a "virtual blockchain".
- See e.g. Blockstack (DNS resolution).
- The mining peers don't know about the DNS blockchain, so they are *not* verifiying legitimacy.
- - Have dedicated peers that are authorized to create blocks. This is called a "permissioned ledger".
- Legitimacy is ensured at the cost of having a central authority.
- Q: When was Bitcoin started?
- A: 2008, by Satoshi Nakamoto.
- ------------------------------------
- Q: What is a Bitcoin address?
- A: The hash of a public key (of an ECC public/private key pair).
- Hash of version and key, plus checksum and base58 encoded.
- Q: Does one need to pay VAT for bitcoin transactions in Switzerland?
- A: No.
- Q: Who controls the blockchain?
- A: The peers, and they software they run.
- See discussion Bitcoin Classic vs. Core (block size).
- Q: What is bitcoin mining?
- A: Generating new blocks that contain transactions, which includes solving a "search puzzle",
- heavily inspired by HashCash (to prevent spam).
- For every block mined there is a reward (25 bitcoins currently).
- The reward decreases over time, and will run out in 2140 with 21 millions bitcoins rewarded.
- Additionally transactions can include a fee, which the miner receives.
- Q: How often is a new block found?
- A: Every 10 minutes.
- The search puzzle's difficulty is increased over time to keep this number constant.
- Q: What happens if the majority of miners is rogue and works together?
- A: They cannot steal bitcoins, because they don't know the private keys.
- They can prevent certain transactions from landing in the blockchain (with the blocks they mine).
- Q: What is the size limit of a block?
- A: 1 Megabyte.
- Q: How big is a transaction?
- A: At least 250 bytes.
- Q: How many transactions can be stored in 1 block?
- A: Max. 4000.
- Q: How many transactions can be processed per second?
- A: About 7. Comparison: VISA processes ~10'000 transactions per second.
- Q: What data does a bitcoin transaction contain?
- A: A number of inputs (previous tx' hash, scriptSig), and outputs (value, scriptPubKey).
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