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Blockchain for Business 2019

You're reading from   Blockchain for Business 2019 A user-friendly introduction to blockchain technology and its business applications

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Product type Paperback
Published in Jan 2019
Publisher
ISBN-13 9781789956023
Length 258 pages
Edition 1st Edition
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Concepts
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Author (1):
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Peter Lipovyanov Peter Lipovyanov
Author Profile Icon Peter Lipovyanov
Peter Lipovyanov
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Table of Contents (17) Chapters Close

Preface 1. Bitcoin, Blockchain, and Cryptoassets FREE CHAPTER 2. A Brief History of Money 3. The Birth of Bitcoin and the Advantages of a Decentralized Payment System 4. Five Forces of Bitcoin - #1 Blockchain 5. Five Forces of Bitcoin - #2 Cryptography 6. Five Forces of Bitcoin - #3 Consensus Algorithm 7. Five Forces of Bitcoin - #4 P2P Network 8. Five Forces of Bitcoin - #5 Software Code Base 9. How Ethereum Took the Idea of Blockchain to the Next Level 10. Ethereum - A Global Platform for Decentralized Applications 11. Blockchains Focused on Specific Sectors and Use Cases 12. Corporate Blockchains 13. The Disruptive Potential of Blockchain Technology 14. Blockchain and AI 15. Current Issues and Potential Solutions to Take Blockchain to the Next Level 16. Other Books You may Enjoy

The Proof-of-Work consensus algorithm

Now that you know the problem, let's see the solution, which is called the Byzantine fault tolerance algorithm. This algorithm involves game theory and math.

The first and foremost practical implementation of the Byzantine fault tolerance algorithm came with the Bitcoin's Proof-of-Work. In this case, the generals are nodes on the Bitcoin network, also known as miners. A network node is a connection point that can receive, create, store, and send data across a network. In other words, nodes are the connected dots that make up a network.

The important concept to grasp here is that these mining nodes start from the assumption that nobody else on the network can be trusted.

The Proof-of-Work algorithm guarantees network consensus even in the presence of Byzantine non-compliant nodes. Let's see how this mechanism works in Bitcoin...

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