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In another comment in this thread I mentioned my boss asking our team if 'blockhains would be a good idea to add security' in our web application because a cust

In another comment in this thread I mentioned my boss asking our team if 'blockhains would be a good idea to add security' in our web application because a customer mentioned them. If I were to send this MS Pain visualisation to my boss he'd still not understand anything about it. The subject is quite complex and the metaphor used is far to abstract for people who already struggle with describing the simplest requirements in a clear way. Note that I don't pretend to know how bitcoins work 100%; I have read up on bitcoins a while back, with this previous knowledge I still picked some things up, but I did not grasp the complete explanation from this MS Paint cartoon. Maybe someone could shine some light on a few things that I am left wondering after reading this cartoon?: [1]: What would be actually 'written on the pages' in the case of bitcoins? The transactions? [2]: What mechanism determines what 'finding' or 'mining' bitcoins means? At one point it says that there are rules regarding how many 'pages' there are per day. Is there a parallel for this in Bitcoins? It says that there is randomness involved in mining. I thought you had to find certain key pairs that were hard to calculate and that those key pairs were then used to grant people bitcoins again. Are the reward-bitcoins simple written in a new block? How does mining work? [3]: 'Sahti' seems to refer to money. Are we talking bitcoins or external currencies?

juhovh 10y ago
1. The transactions. 2. The mechanism used to determine what 'mining' bitcoins means is defined by the bitcoin client software implementation. In case of bitcoin it is about finding a suitable random number by using brute force. 3. I believe the cartoon is using sahti in comparison to bitcoins or ether or any internal currency used in a public blockchain.
- mosselman 10y ago
  Thank you for your answer. With regards to 2, what would define a 'a suitable random number'?
Udik 10y ago
There's tons of people here on HN that know this stuff by heart, but as far as I understood: 1) I guess so, the blockchain contains the bitcoin transactions. 2) In order to add a block to the blockchain, you need to mix the block's fingerprint with a random value and shake, hoping for the mix to get a special and very recognisable appearance. If it doesn't work, you have to try a new random number (the block's fingerprint of course stays the same). When you've found a good number (which takes a lot of tries and luck) you raise a flag and say "hey, found it", and you can add your block to the chain. Then you're rewarded with some amount of bitcoins that are created from nothing (hence mined). I don't have clear how this reward is granted, whether it's already written in the block you're trying to add or in a new one, and in which form.
- mosselman 10y ago
  Thank you for your explanation. It certainly clears a few things up. With regards to "hoping for the mix to get a special and very recognisable appearance". What happens here concretely? What would 'very recognisable' entail?
  - Udik 10y ago
    Very late reply, but in case anybody sees this. The "shaken mix" of fingerprint + random number must produce a number that is lower than a certain target number. The most visible consequence of this is that the accepted numbers must begin with a string of zeros (as the number of digits is fixed, as in 0003 is lower than 0123). Example: Not a good mix: 1312af178c253f84028d480a6adc1e25e81caa44c749ec81976192e2ec934c64 A good mix: 0000000000000000057fcc708cf0130d95e27c5819203e9f967ac56e4df598ee This "shaken mix" is a SHA-256 hash of the current block plus a random number. SHA-256 is an algorithm that generates a "fingerprint" (called "hash") of a block of data, in such a way that it is not possible to determine, from the fingerprint itself, which data might have generated it [otherwise it would be possible to start from (a set of) desired fingerprints and calculate back to the set of possible blocks that could generate them].
m3ta 10y ago
The subject could be seen as very complex but for most use-cases there is a simple litmus test. Do you need censorship-resistant transactions or a neutral/decentralized timestamping server? If not, then you don't need a blockchain. That's really it. In the case of a vendor, accepting _bitcoin_ has own security advantages, and bitcoin comes with its own blockchain built-in. As a vendor you probably wouldn't really need to worry about the blockchain as much as you would need to worry about avoiding exchange rate fees.
- mosselman 10y ago
  I will keep your answer in mind when I get asked this question again. Thank you.

juhovh 10y ago

1. The transactions. 2. The mechanism used to determine what 'mining' bitcoins means is defined by the bitcoin client software implementation. In case of bitcoin it is about finding a suitable random number by using brute force. 3. I believe the cartoon is using sahti in comparison to bitcoins or ether or any internal currency used in a public blockchain.

mosselman 10y ago
Thank you for your answer. With regards to 2, what would define a 'a suitable random number'?

Udik 10y ago

There's tons of people here on HN that know this stuff by heart, but as far as I understood: 1) I guess so, the blockchain contains the bitcoin transactions. 2) In order to add a block to the blockchain, you need to mix the block's fingerprint with a random value and shake, hoping for the mix to get a special and very recognisable appearance. If it doesn't work, you have to try a new random number (the block's fingerprint of course stays the same). When you've found a good number (which takes a lot of tries and luck) you raise a flag and say "hey, found it", and you can add your block to the chain. Then you're rewarded with some amount of bitcoins that are created from nothing (hence mined). I don't have clear how this reward is granted, whether it's already written in the block you're trying to add or in a new one, and in which form.

mosselman 10y ago
Thank you for your explanation. It certainly clears a few things up. With regards to "hoping for the mix to get a special and very recognisable appearance". What happens here concretely? What would 'very recognisable' entail?
- Udik 10y ago
  Very late reply, but in case anybody sees this. The "shaken mix" of fingerprint + random number must produce a number that is lower than a certain target number. The most visible consequence of this is that the accepted numbers must begin with a string of zeros (as the number of digits is fixed, as in 0003 is lower than 0123). Example: Not a good mix: 1312af178c253f84028d480a6adc1e25e81caa44c749ec81976192e2ec934c64 A good mix: 0000000000000000057fcc708cf0130d95e27c5819203e9f967ac56e4df598ee This "shaken mix" is a SHA-256 hash of the current block plus a random number. SHA-256 is an algorithm that generates a "fingerprint" (called "hash") of a block of data, in such a way that it is not possible to determine, from the fingerprint itself, which data might have generated it [otherwise it would be possible to start from (a set of) desired fingerprints and calculate back to the set of possible blocks that could generate them].

m3ta 10y ago

The subject could be seen as very complex but for most use-cases there is a simple litmus test. Do you need censorship-resistant transactions or a neutral/decentralized timestamping server? If not, then you don't need a blockchain. That's really it. In the case of a vendor, accepting _bitcoin_ has own security advantages, and bitcoin comes with its own blockchain built-in. As a vendor you probably wouldn't really need to worry about the blockchain as much as you would need to worry about avoiding exchange rate fees.

mosselman 10y ago
I will keep your answer in mind when I get asked this question again. Thank you.