BitcoinNikhil Bhatia 2k13/SE/53Sarthak Khandelwal 2k13/SE/72Sakshi Kumar 2k13/SE/70

What is Bitcoin?

• Open Source Software

• Crypto-currency/Digital Currency

• Peer to Peer transaction system

Who invented Bitcoin?

• Satoshi Nakamoto (Unknown)- 2009

• Believed to be developed by Samsung(Sa), Toshiba(toshi), Nakamichi(naka), Motorola(moto).

Features of Bitcoin

• No central ruling authority

• All transactions are public

• All transactions are verified by users (miners)

How does it work?

Design of the Bitcoin System

Transaction

BlockChain

Mining

BlockChain

• Public ledger/Distributed database

• Verify Bitcoin transactions

Fig: Total Bitcoins in circulation

Transaction

• Transactions can be made using QR Codes

• Made in BTC denominations: mBTC, µBTC, bit, satoshi.

• Public-key cryptography is used.

Mining • Record keeping service.

• It is a cryptographic hash of the previous block (SHA-256)

• Hash of the new block smaller than the ‘difficulty target’ serves as a ‘proof-of-work’

Miners

• Nodes in the Bitcoin network(users) who perform mining operation.

• 25 BTC awarded for hashing a new block Rs. 3,50,000

Crytographic Hashing• A hash function which is considered practically impossible to invert.

a) easy to compute the hash value for any given messageb) infeasible to generate a message from its hashc) infeasible to modify a message without changing the hashd) infeasible to find two different messages with the same hash.

• Eg. SHA1 , SHA2, MD5

SHA 2 Algorithm

• A family of two similar hash functions, known as SHA-256 and SHA-512. They differ in the word size; SHA-256 uses 32-bit words where SHA-512 uses 64-bit words.• Designed by the NSA.• Used in security applications and protocols

- TLS and SSL.

Thank You.