block chain database of bitcoin.
every block added every 10 minutes on average may vary. depending if very easy or hard t create hash sha-256
chain should be longest chain so they get reward. Every block gets rewards 10 minutes 50 bitcoin and halves every 4 years.
same block can be created at the same time. start working on first block that you see. Chk which form longest chain. Then all blocks stop working on other and starts working on the one that was the largest. Forking of chain is also done. Longest one wins.
Transaction in bitcoin:A bitcoin uses elliptic curve(signature is shorter to control length of block chain.). A private key is 32 random bytes. A public key computed from private key. There is no cryptography in bitcoin. Only signing.
Bitcoin addresses are like bank account numbers they are random and long. Calculated from a public key RIPEMD-160(SHA256(public key)). No one knows who owns which. You can have a many bitcoin addresses. Value can be moved from one account to other via transactions.
Bitcoin mining is the process of adding transaction records to Bitcoin’s public ledger of past transactions or blockchain. This ledger of past transactions is called the block chain as it is a chain of blocks. The block chain serves to confirm transactions to the rest of the network as having taken place.
merkle root is a binary tree of SHA256 hashes: Transaction are unconfirmed. No block in the chain trusts a transaction untill confirmed by miner. Miner pulls a random transaction from the unconfirmed transactions and adds it into a block. Then the transaction is broadcast to all the nodes. But there can be a fork in the block chain where a illegit node can try a transaction.
A hacker can send two transactions and broadcast into the network. Half network will believe that first one is legit and other half will believe in the other transaction.
bitcoin properties 1. you cannot add money at your will you need huge computational power.
Biggest distributed computing in the world. If you combine top 50 supercomputers in the world they will be 200 time slower than bitcoin network. You can add blocks if you have huge computational power but you cannot keep doing it for a long amount of time because the block chain will readjust the hardness and it will become more difficult for you to keep on adding nodes.
This attack is very expensive around millions.
Block chain concept is new.
A block can only be one MB large- 1000 transactions in a block. Cannot use brute force attack on it because of SHA 256. When the block rewards gets upto 0 then the miners will live on transaction fees.