WEBVTT

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hi in this video we will get an

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introduction to blockchain which is the

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technology that crypto currencies like

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Bitcoin are based on blockchain is based

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on a concept called proof of work

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basically if you want to get paid any

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kind of cryptocurrency

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you have to prove you have worked on the

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blockchain through a transaction of some

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kind so what is this blockchain well a

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blockchain is a digital ledger in which

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transactions made in something like

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Bitcoin or another cryptocurrency are

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recorded chronologically and publicly we

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can actually look at a blockchain and

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see evidence or proof of what has

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happened or what is going on this

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evidence in the ledger is our proof of

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work a blockchain is really no more than

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a distributed database that utilizes a

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very large network of computing devices

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think of it as a large worldwide

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computer where everyone can securely

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access data and execute transaction code

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all transactions are stored in blocks of

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data a ledger is a list of transactions

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or exchanges that usually includes

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information about the transactions such

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as the date what was purchased amounts

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etc block chains are also immutable if

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you find an error on your bank statement

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like an extra charge the bank can't

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remove that charge instead the bank

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refunds your money in a regular ledger

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if someone modifies one entry it has no

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impact on the other entries when you

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mutate something you change it like the

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amount above that was originally 1,500

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it was changed to 2,000 this cannot

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happen in a blockchain immutable means

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you can't change it block chains are

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immutable blocks in a blockchain are

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made in such a way that it makes them

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very hard to manipulate or fake once

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they are stored to the blockchain

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because if someone modifies an entry or

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transaction it instantly invalidates all

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of the later entries blockchain makes it

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harder to tamper with ledger

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transactions and easier to detect

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tampering should it occur in order to

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accomplish this it uses something called

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a hash

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a hashes of value produced by hashing

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function in computer programming so

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cryptography is the practice of encoding

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information so only authorized people

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can read it hashing is one of these

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types of cryptography that we can use to

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make data secure and it's the foundation

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for making block chains hashing in a

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blockchain changes a transaction into an

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unreadable string of text for the

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purpose of encrypting the transaction as

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we'll see hashing is perfectly suited

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for block chains a cryptographic hash

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function is a one-way function that

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takes input data of some arbitrary

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length and produces a fixed sized output

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so the hash is always the same size that

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the hash function tells it to be

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regardless of how big the input is the

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hash is a lot smaller than the data

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itself and it's generated by a

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mathematical formula inside of a

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computer program in such a way that it's

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really unlikely that some other text

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would produce that same hash value

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hashing algorithms and block chains take

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a chunk of transaction data and hash it

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the cool thing about hash data is that

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the computation is much simpler going

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forwards than backwards so it's easy to

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confirm we get an output hash that

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usually looks like nonsense as shown but

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it will always be the same length no

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matter how big our input was making good

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one-way hash functions and block chains

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relies on some math to produce these

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random strings of letters and numbers s

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hash output we won't get into the math

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instead we'll use a simple online hash

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generator the most used hashing

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algorithms are generally very well known

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and available to the public if very

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common hashing algorithm used with

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blockchain technology is sha-256 it is

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one of several hashing algorithms and it

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will produce a long text string as a

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result so let's jump out to a sha-256

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hash generator this is a really simple

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hash generator where you can enter any

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kind of text and see what kind of hash

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is actually generated below so let's

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let's say I type in the word code HS

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notice I get a hash of that string it's

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8 d 0 0 9 2 6

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and so forth so it's a string of letters

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and numbers this is my hashed output if

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I remove just a single letter the letter

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S look how drastically my hash changes

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zero to eight one eight seven two blah

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blah so just changing the input even

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slightly changes the entire hash output

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so I put the s back on I still get the

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same original input eight D zero zero

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nine six two so any given input should

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always produce the exact same hash

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output but just changing the input ever

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so slightly will completely change the

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hash output and that's what a good hash

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generator or hash algorithm should do

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now is your turn to explore some

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resources and activities