LinkedIn /in/petkanic/

Transcription

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2 This is the first time in a history of a mankind when

3 we are able to permanently record the history of a mankind.

4 Yes, blockchain is a bubble.

5 And it s going to burst.

6 But that s amazing! Because only genuine blockchain projects will survive.

7 Ethereum could be one of them.

8 Misconceptions, hype and

9 Misconceptions, hype and misunderstood decentralization

10 About the author Jana Petkanic

11 About the author Jana Petkanic MSc in Applied Mathematics

12 About the author Jana Petkanic MSc in Applied Mathematics IT Services Manager at Accenture; Forecast Analyst Henkel

13 About the author Jana Petkanic MSc in Applied Mathematics IT Services Manager at Accenture; Forecast Analyst Henkel Ran an NGO to fight the food waste

14 About the author Jana Petkanic MSc in Applied Mathematics IT Services Manager at Accenture; Forecast Analyst Henkel Ran an NGO to fight the food waste Blockchain consultant at Axveco

15 About the author Jana Petkanic MSc in Applied Mathematics IT Services Manager at Accenture; Forecast Analyst Henkel Ran an NGO to fight the food waste Blockchain consultant at Axveco Now: blockchain consultancy and online education for supply chain companies + token economy models + Blockchain Talks

16 Today!

17 Today! You will understand what blockchain is What are the main features of Ethereum Beauty of Merkle trees

18 Today! You will understand what blockchain is What are the main features of Ethereum Beauty of Merkle trees You will learn more about some interesting use-cases

19 Today! You will understand what blockchain is What are the main features of Ethereum Beauty of Merkle trees You will learn more about some interesting use-cases You will learn how can we potentially improve an industry which creates 2/3 global GDP

20 Today! You will understand what blockchain is What are the main features of Ethereum Beauty of Merkle trees You will learn more about some interesting use-cases You will learn how can we potentially improve an industry which creates 2/3 global GDP Perhaps you will find a new meaningful passion

21 A roller-coaster

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33 People are willing to pay more for cryptocurrencies. Why?

34 Of course, speculation and Wild West practices are involved. But is there anything of a value?

35 Is it the underlying technology that is of a value?

36 Value transfer today - 3 levels

37 Value transfer today - 3 levels - Information flow

38 Value transfer today - 3 levels - Information flow - Money (=value) flow

39 Value transfer today - 3 levels - Information flow - Money (=value) flow - Product flow

40 Value transfer today - 3 levels - Information flow - Money (=value) flow - Product flow Supply chain

41 Value transfer today - 3 levels - Information flow - Money (=value) flow - Product flow Financial sector

42 Value transfer today Bank A

43 Value transfer today Bank A Bank B

44 Value transfer today Information flow Bank A Bank B Information flow

45 Value transfer today Information flow internet Bank A Bank B Information flow

46 Value transfer today Information flow value flow Bank A internet Bank B value flow Information flow

47 Value transfer tomorrow use-case for 2 bln people Information flow Information flow

48 Value transfer tomorrow Information flow internet Information flow

49 Value transfer tomorrow Value flow Information flow internet Information flow Value flow

50 Value transfer tomorrow Value flow Information flow blockchain Information flow Value flow

51 Transaction of a value across internet can be facilitated by blockchain

52 Internet of values

53 How can we preserve the value when sending it through internet?

54 Value is created by a system which is Difficult to corrupt Trusted Secure Advantage over legacy systems Liquid Convenient to use

55 Transaction of a value across internet can be facilitated by blockchain

56 So what?

57 Think of a very simple usecase

58 Invoicing in 1970 s

59 Invoicing in 1990 s

60 Invoicing in 1990 s Average settlement time in global supply chains is

61 Invoicing in 1990 s Average settlement time in global supply chains is 52 days

62 Invoicing of tomorrow

63 Invoicing of tomorrow No invoicing.

64 Invoicing of tomorrow No invoicing.

65 Invoicing of tomorrow No invoicing.

66 Invoicing of tomorrow No invoicing.

67 Invoicing of tomorrow No invoicing.

68 Invoicing of tomorrow No invoicing.

69 Invoicing of tomorrow No invoicing.

70 Invoicing of tomorrow No invoicing. Smart contracts + cryptocurrency

71 Invoicing of tomorrow No invoicing. Smart contracts + cryptocurrency technically feasible on Ethereum blockchain

72 What is a blockchain? Key vocabulary, essential features

73 Blockchain Blockchain immutable distributed ledger of transactions performed by the network participants

74 But where is the chain and where are the blocks?

75 Blockchain Blockchain immutable distributed ledger of transactions performed by the network participants

76 Network types

77 Node Node; miner; participant of the network

78 A ledger of transactions A ledger of transactions performed by the network each node holds the same copy which is connected with each other

79 A wallet Wallet UI to blockchain

80 Ethereum fundamentals

81 Ethereum protocol Currency: Ether, ETH,

82 Ethereum protocol Currency: Ether, ETH, Inflationary model (no hard cap, deflationary model discussed)

83 Ethereum protocol Currency: Ether, ETH, Inflationary model (no hard cap, deflationary model discussed) Proof-of-work (soon proof-of-stake with Casper)

84 Ethereum protocol Currency: Ether, ETH, Inflationary model (no hard cap, deflationary model discussed) Proof-of-work (soon proof-of-stake with Casper) Notable forks: Ethereum Classic

85 Ethereum protocol Currency: Ether, ETH, Inflationary model (no hard cap, deflationary model discussed) Proof-of-work (soon proof-of-stake with Casper) Notable forks: Ethereum Classic dapps applications built on top of ETH

86 Outline Development Upgrades Hacks Accounts Communication EVM

87 Outline Development Upgrades Hacks Accounts Communication EVM

88 Development Idea: Vitalik Buterin, late 2013

89 Development Idea: Vitalik Buterin, late 2013 Start of development: in Switzerland, early 2014

90 Development Idea: Vitalik Buterin, late 2013 Start of development: in Switzerland, early 2014 Jul-Aug 2014: public crowdsale (~15.5m USD in BTC)

91 Development Idea: Vitalik Buterin, late 2013 Start of development: in Switzerland, early 2014 Jul-Aug 2014: public crowdsale (~15.5m USD in BTC) Name Ethereum Vitalik read wikipedia and he liked it

92 Outline Development Upgrades Hacks Accounts Communication EVM

93 Upgrades

94 Upgrades

95 Privacy zk-snarks zcash, privacy model ZKRP

96 Zero knowledge?

97 Zero knowledge!

98 Zero knowledge!

99 Privacy zk-snarks zcash, privacy model ZKRP

100 Privacy zk-snarks zcash, privacy model ZKRP

101 Privacy

102 Outline History Upgrades Hacks Accounts Communication Mining Upgrades

103 The DAO hack

104 The DAO hack In 2016, the DAO raised 150m USD in public crowdsale

105 The DAO hack In 2016, the DAO raised 150m USD in public crowdsale Anonymous entity managed to claim 50m USD This activity was fully inline with protocol

106 The DAO hack In 2016, the DAO raised 150m USD in public crowdsale Anonymous entity managed to claim 50m USD

107 The DAO hack Ethereum Classic Ethereum

108 Upgrades

109 Outline History Upgrades Hacks Accounts Communication Mining

110 Accounts Interact with each other through a message-passing network Account has a state and 20-byte address

111 Accounts Interact with each other through a message-passing network Account has a state and 20-byte address 2 types of accounts: Externally owned accounts, controlled by private keys Contract accounts, controlled by contract code and contain an associated code

112 Types of accounts Wallet as externally-owned account

113 Types of accounts Wallet as externally-owned account Contract account containing the associated code

114 Accounts Interact with each other through a message-passing network Account has a state and 20-byte address 2 types of accounts: Externally owned accounts, controlled by private keys Contract accounts, controlled by contract code and contain an associated code Communication: Externally owned accounts value transfer Externally owned acc vs contract account can trigger an event (new contract, exec contract, etc) Contract account cannot initiate new transaction

115 Communication between accounts Value transfer Wallet as externally-owned account Contract account containing the associated code

116 Communication between accounts Can trigger an event new contract, contract exec Wallet as externally-owned account Contract account containing the associated code

117 Communication between accounts Contract account cannot initiate new transaction Wallet as externally-owned account Contract account containing the associated code

118 ! Part of the protocol which handles transactions is called EVM Ethereum Virtual Machine

119 Account state 4 components Nonce either No of transactions sent from acc address OR No of contracts created by the acc Balance No of Wei owned by the address (1 ETH = 10^18 Wei) storageroot a hash of the root node of Merkle tree codehash the hash of EVM code of this acc (for ext owned empty string)

120 World state Mapping between account addresses and the account states

121 World state Mapping between account addresses and the account states Merkle tree

122 Merkle is not Merkel.

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125 Merkle proof

126 Merkle proof

127 Block header State tree Transactions tree Receipts tree

128 Nodes full, light Full node entire blockchain Light node only the chain of headers

129 Node Node; miner; participant of the network

130 Gas and fees Everything is paid This payment is called gas

131 Gas and fees Everything is paid This payment is called gas Gas is a unit Gas price [gwei]

132 Gas and fees Everything is paid This payment is called gas Gas is a unit Gas price [gwei] Every transaction Gas limit Gas price Sender is refunded for any unspent gas

133 Gas and fees In case a sender does not have enough gas transaction does not go through The higher the gas price, the more likely are miners (as beneficiaries) to process it

134 Gas and fees Gas is used to pay the storage use as well Incentive of the network the storage as low as possible Sender rewarded when freeing up the storage Fees role is to save some energy and prevent loops

135 Blocks All transactions are stored in a block Block consists of The block header Information about the set of transactions included in that block A set of other block headers for the current block s ommers

136 Blocks All transactions are stored in a block Block consists of The block header Information about the set of transactions included in that block A set of other block headers for the current block s ommers Block time: ~15 seconds (BTC: ~10 mins) We say mining Ethereum but we basically refer to mining a block on ETH blockchain But! Shorter the time, more competing/orphaned blocks! (mined blocks which do not make it to the main chain) Ommer blocks receive smaller reward than a full block; ommer block can be referenced if younger than 6 th generation

137 Blocks All transactions are stored in a block Block consists of The block header Information about the set of transactions included in that block A set of other block headers for the current block s ommers Block time: ~15 seconds (BTC: ~10 mins) We say mining Ethereum but we basically refer to mining a block on ETH blockchain But! Shorter the time, more competing/orphaned blocks! (mined blocks which do not make it to the main chain) Ommer blocks receive smaller reward than a full block; ommer block can be referenced if younger than 6 th generation

138 GHOST protocol Used for determining which chain is valid GHOST = Greedy Heaviest Observed Subtree We pick the path that has had the most computation power done upon it

139 Block header parenthash ommershash Beneficiary stateroot transactionsroot receiptsroot logsbloom Difficulty Number gaslimit gasused Timestamp extradata mixhash nonce

140 Transaction execution All transaction have to meet following criteria RLP recursive length prefix Valid transaction signature Valid transaction nonce Transaction gas limit >= intrinsic gas Pre-defined gas units Gas fee (4 gas for every B which equals 0; 68 gas otherwise) If it s a contract-creating transaction: another gas

141 Comparison to Bitcoin protocol Block time BTC: ~10 mins; ETH: ~14-15 sec Mining ETH reward: 3 ETH/block Different PoW algorithm Scripting language to create smart contracts Average block size

142 Take-aways

143 You can forget what precisely is in the ETH block header only remember following:

144 1. Never stop studying and always be curious

145 1. Never stop studying and always be curious

146 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario)

147 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community

148 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code

149 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain

150 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain A purpose

151 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain A purpose A value (= product)

152 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain A purpose A value (= product) A traction

153 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain A purpose A value (= product) A traction A network

154 2. Don t buy just because it seems to skyrocket soon Every cryptocurrency is (in best scenario) A community A code A blockchain A purpose A value (= product) A traction A network Buying = voting. The more you buy, the more support for the creators you show.

155 2. Don t buy just because it seems to skyrocket soon

156 2. Don t buy just because it seems to skyrocket soon

157 3. Be patient with regulators they just don t know

158 3. Be patient with regulators they just don t know Blockchain is an innovation, flying car is an innovation. So what s the difference?

159 3. Be patient with regulators they just don t know Imagine you are really building such flying car

160 3. Be patient with regulators they just don t know And you want to have it fully regulated.

161 3. Be patient with regulators they just don t know Regulators can merge and tweak existing regulations because

162 3. Be patient with regulators they just don t know Regulators can merge and tweak existing regulations because

163 3. Be patient with regulators they just don t know But what about blockchain?

164 3. Be patient with regulators they just don t know But what about blockchain?

165 4. Support #BUIDLing Don t ride the hype support projects with genuine purpose which are here to stay

166 5. cryptohumor

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