Lecture 26: Bitcoin (Part 1)

• Slides
• Playlist (length: 44:58)

What is Bitcoin?

Designing Bitcoin: Identity

(True/False) In Bitcoin each user has a symmetric key associated with their identity.

False. They have a public, asymmetric key.

Designing Bitcoin: Transactions

In Bitcoin, how do we make sure a user can only spend money they have?

We make use of the public ledger. Everytime a transaction is made, a user will publish it to the ledger. Then, anyone can verify how much money a person has by tracing back the transaction history.

Designing Bitcoin: Blockchain

(True/False) If instead of hashing the entire previous block in our blockchain, we just hashed part of it, this would still be secure since an attacker can’t break collision resistance.

False. The attacker can modify the parts of the block that aren’t hashed

Designing Bitcoin: Motivating Consensus

Consider a version of the protocol we’ve seen thus far, which requires two individuals working together to add a block to the hashchain. Assume there is only a single adversary, Mallory, in the network - can she double-spend via a fork?

No. To do this she would need to generate an alternate, valid blockchain from a point in the past. Since this requires two people, Mallory will be unable to create this alternate chain herself. This concept is similar to what Bitcoin attempts to do via it’s Proof-of-Work consensus mechanism we’ll see next lecture