The document describes how to build a blockchain in 40 minutes by implementing blocks, transactions, mining, consensus, and propagation. It outlines 4 steps: 1) create the initial blockchain and transactions, 2) mine new blocks by adding transactions and a reward, 3) reach consensus by comparing blockchains' validity, and 4) decentralize by propagating transactions and blocks between nodes. The blockchain can be built following instructions in the linked GitHub repository.
7. A Blockchain is an implementation of a distributed ledger
B1B2B3
B1B2B3
B1B2B3
B1B2B3
B1B2B3
B1B2B4
8. A Blockchain is an sequential, immutable chain of records
called Blocks
Block
transactiontransactiontransaction
Block
transactiontransactiontransaction
Block
transactiontransactiontransaction
9. index : 2
previous hash
payload
transaction
transaction
transaction
Immmutability is implemented by hashing
index : 1
previous hash: 0
Genesis block
transaction
index : 3
previous hash
payload
transaction
transaction
transaction
11. Let’s build a Blockchain, then!
BlockchainRestController
Blockchain TransactionPool
BlockBlockBlockBlock
TransactionTransactionTransactionTransaction
Manages Manages
Has Has
API
GET /api/blockchain
POST /api/createtransaction
GET /api/pendingtransactions
POST /api/mine
Network
Interacts
with
12. Step 1: Create the initial blockchain
index : 1
previous hash: 0
Genesis block
13. Create the block structure
public class Block {
private long index;
private Set<Transaction> transactions = new HashSet<>();
private String previousHash;
private long nonce;
…getters, setters, toString etc.
}
14. Making the initial chain
public class Blockchain {
private LinkedList<Block> blocks = new LinkedList<>();
static Blockchain create() {
Blockchain blockchain = new Blockchain();
Block block = new Block();
block.setIndex(1);
block.setPreviousHash("0");
block.setNonce(0);
blockchain.blocks.add(block);
return blockchain;
}
}
15. Kudo’s (from, to, kudos)
Pool of transactions
Out of scope:
• Transaction integrity (signing)
• Transaction inputs and outputs
Transaction pool
transaction
transaction
transaction
Step 2: Create something to store in
the blocks
16. Creating a transaction
public class Transaction {
private String id;
private String from;
private String to;
private int kudos;
..getters, setters…
… equals and hashcode based on id only!
}
17. Creating a transaction pool
public class TransactionPool {
private Set<Transaction> transactions = new HashSet<>();
public void addTransaction(Transaction transaction) {
transactions.add(transaction);
}
public void clearTransactions() {
transactions.clear();
}
public Set<Transaction> getAllTransactions() {
return new HashSet<>(transactions);
}
}
18. Creating a transaction
@PostMapping("/api/createtransaction")
public long createTransaction(@RequestBody Transaction transaction) {
//give the transaction an id
transaction.setId(UUID.randomUUID().toString());
//add the transaction to the pool
transactionPool.addTransaction(transaction);
//return the height of the next block
return blockchain.height() + 1;
}
19. • Block should contain hash of previous
block (immutability, trust)
• Creating a block requires proof-of-
work (supports consensus)
• Creating a block should give a reward
(incentive, generation transaction)
index : 2
previous hash
payload
transaction
transaction
transaction
index : 1
previous hash: 0
Genesis block
Step 3: making (mining) a new block
20. Proof-of-work
• It should be hard to create a new
block
• Makes cheating unattractive
• It should be easy to verify a new
block
21. Remember this Nonce thingy?
“(new block)” “00005c3d2d...”SHA256 hash
“(new block with nonce x)” “00005c3df8...”SHA256 hash
X = 100
Creating a proof-of-work (hard)
Verifying proof-of-work (easy)
22. Mining a new block
@PostMapping("/api/mine")
public Block mine() {
Block block = getBlockchain().mine(transactionPool.getAllTransactions());
transactionPool.clearTransactions();
return block;
}
23. Mining a new block
public class Blockchain {
...
public Block mine(Set<Transaction> allTransactions) {
Block block = new Block();
block.setIndex(this.blocks.size() + 1);
block.setPreviousHash(DigestUtils.sha256Hex(blocks.getLast().toString()));
block.setTransactions(allTransactions);
//create reward
Transaction reward = new Transaction();
reward.setId(UUID.randomUUID().toString());
reward.setFrom("");
reward.setTo(“Michel for creating this block");
reward.setKudos(3);
allTransactions.add(reward);
block.calculateProofOfWork();
blocks.add(block);
return block;
}
}
24. Proof of work
public class Block {
…
public void calculateProofOfWork() {
this.nonce = 0;
while (!DigestUtils.sha256Hex(this.toString()).startsWith("0000")) {
this.nonce++;
}
}
}
25. • The longest blockchain that is valid “wins”
• A blockchain is valid when
• Previous hash field of each block matches hash of previous block
• Proof-of-work (nonce) is verified and correct for each block
Step 4: consensus with other nodes
26. Comparing with other blockchains
In your service…
public void init() {
this.blockchain = Blockchain.create();
this.blockchain = network.retrieveBlockchainsFromPeers()
.stream()
.filter(b -> b.isValid())
.filter(b -> b.height() > this.blockchain.height())
.max(Comparator.comparing(Blockchain::height))
.orElse(this.blockchain);
}
27. Comparing with other blockchains
public boolean isValid() {
for (int i = blocks.size() - 1; i > 0; i--) {
Block currentBlock = blocks.get(i);
Block previousBlock = blocks.get(i - 1);
if (!previousHashMatches(previousBlock, currentBlock)) {
System.out.println("previous hash doesn't match!");
return false;
}
if (!currentBlock.isValid()) {
System.out.println("proof of work is invalid");
return false;
}
}
return true;
}
private boolean previousHashMatches(Block previousBlock, Block currentBlock) {
return currentBlock.getPreviousHash()
.equals(DigestUtils.sha256Hex(previousBlock.toString()));
}
28. Comparing with other blockchains
public class Block {
…
boolean isValid() {
return DigestUtils.sha256Hex(this.toString()).startsWith("0000");
}
…
}
29. Step 5: Implementing decentralization
• Transactions are propagated
• Everybody should have the chance to mine
• Blocks are propagated
• Validation is performed before accepting
• This could prevent downloading all chains
31. Receiving transactions from the network
@PostMapping("/api/addtransaction")
public void newTransactionReceived(@RequestBody Transaction transaction) {
if (!transactionPool.getAllTransactions().contains(transaction)) {
transactionPool.addTransaction(transaction);
network.notifyPeersOfNewTransaction(transaction);
}
}
33. Receiving blocks from the network
@PostMapping("/api/addblock")
public void newBlockReceived(@RequestBody Block block) {
//only add block if it is valid
if (blockchain.isValid(block)) {
blockchain.addBlock(block);
//clear all transactions that are already in the block
transactionPool.clearTransactions(block.getTransactions());
//propagate block through the network
network.notifyPeersOfNewBlock(block);
}
}
34. Receiving blocks from the network
public class Blockchain {
...
private boolean previousHashMatches(Block previousBlock, Block currentBlock) {
return currentBlock.getPreviousHash()
.equals(DigestUtils.sha256Hex(previousBlock.toString()));
}
public boolean isValid(Block block) {
return block.isValid() && previousHashMatches(blocks.getLast(), block);
}
public void addBlock(Block block) {
blocks.add(block);
}
}
35. Summary
We created a blockchain in 40 minutes with:
• Blocks
• Transactions
• Mining
• Reaching consensus
• Propagation
Now go and build one yourself!
https://gitlab.com/craftsmen/workshop-blockchain
Switch to branch “demo-solution” if you just want the solution
So good afternoon! Still got some every left? Thank you for coming to this session. My name is Michel Schudel. I’m a software developer from a IT company from the Netherlands called Craftsmen, I’m currently working for Dutch Railways working on traffic control systems. So today, let’s build a blockchain from scratch and hopefully have it working in 40 minutes!
So why this session? I’ll explain. Does anyone have any cryptocurrency? How’s it going so far? Well, I started to get really exited about all these crypto currencies and the technology behind them. So I started looking for articles. Problem was, the articles were either like this:
…or this, way too complex examples that also pulled in signing, double spending etc.
In essence, a blockchain is…. Each block contains one or more transactions, and each block has some kind of backreference to the previous block. This will give the blockchain its immutability.
Furthermore, a blockchain is distributed. So each participant in the network has the same copy of the blockchain. So if you’re the odd one out, you won’t be accepted as having a valid blockchain.
Important point to discuss is that immutabilty is implemented by hashing. Each block contains a hash of the previous block. You can imagine that if you change a transaction in block 2, all subsequent block’s hashes will change as well. So you’ll have to recalculate all these hashes as well. Apart from convincing everyone your blockchain is the correct one, making new blocks or changing existing blocks is not easy. It requires something called proof-of-work, which we will see when we’re going to build the blockchain.
So, let’s get started with an initial block! Not to worry about this hashing thingy, let’s just set up the model, right?