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The Bitcoin and Blockchain Technology Explained | Magnus Prep Explains

Cryptocurrency and Blockchain Bitcoin was recently in the news yet again for reaching new value heights From being worth a couple of cents in 2008, it was worth more than $12000 in the first week of december Bitcoin is a kind of cryptocurrency that uses blockchain technology for its exchange and distribution

This technology in turn, is one of the biggest disruptors in the world of finance today And as soon as you try to understand what it is all about, you are bombarded with a host of terms such as Blockchain, Hashing, Distributed Ledger and whatnot So in this edition of Magnus Prep Explains…let’s decode Cryptocurrency and Blockchain For the sake of simplicity let us assume that transaction here would mean only monetary transactions Blockchain: Data today is a power tool which can be used to do wonders

But if this data is stored in a centralised place, it is vulnerable to attacks and thefts Blockchain offers analternative to this Blockchain technology enters the records of your transactions at multiple digital entities Each of these entities become a part of a decentralised ledgerThis is similar to the ledger that your bank has for your credit card transactions, but here the ledger is not held with a central authority (i

e your bank), but thousands of copies of this ledger are distributed all over the network Each and every part of the network ie a human acting through a computer can verify the transaction

Hence the term ‘decentralised ledger’ is used to refer to such ledgers This blockchain is Fault Tolerant Which means that if one of the computers that are a part of the network is not able to verify the transaction due to some error, the transaction can still be verified by the other computers of the network So when A sends some money to B using the blockchain network, a new entry is created which needs to be agreed upon by every person who is a part of the blockchain It is just like A and B having some hundreds of friends around them, who watch A send the money to B and then verify whether the details of the transaction such as the amount of money transferred is correct or not Every such transaction remains a part of the ledger forever, which means an entry to the ledger cannot be removed

It remains there till perpetuityThus there is no central authority involved No bank, no government, no notary In short, no middlemen through which the transaction needs to be routed through So what if we have a rogue in the blockchain who tries to tamper with the records and tries to modify or change the entries of the distributed ledger Well, the nature of the blockchain makes it impossible for our troublemaker to do so as this modification would be rejected by all the other computers that verified the transaction Hence, a blockchain lacks a central point of vulnerability

Instead of having to breach just one server or computer, our rogue guy can cause trouble if only a majority of the network is compromised So the Blockchain does not have a single point of failure Here is something interesting to note When all the other people on the network verify the transaction, they actually verify the parties involved in the transaction through an encrypted key Every party who is a part of the transaction has a unique key (which is generated by a different algorithm)

Hence while a transaction can be verified, the true identity of the parties involved cannot Bitcoin: Bitcoin is a cryptocurrency or digital money which can be used as a currency while making a transaction using blockchain It is not a physical coin One can own multiple coins or even one-thousands of a Bitcoin Bitcoin is not the only cryptocurrency that are available to trade in There are other cryptocurrencies as well

Some popular examples are: 1) LiteCoin(MAKE THESE APPEAR AS I SPEAK) 2) Zcash 3) Ripple 4) Ethereum But another question arises now If there is no bank, where is all the digital money stored? All the money is stored in digital walletsEach digital wallet has a wallet address which is similar to your bank account number Thus a member of the blockchain can make a transaction from his own wallet address to the other party’s wallet address But he has no control over what happens once the money is deposited in the other party’s wallet Blockchain security measures use a unique encryption technology rooted in the so-called Public and Private Keys: a) A public key (a long, randomly-generated string of numbers) is a users’ address on the blockchain

Bitcoins sent across the network gets recorded as belonging to that address b) The ‘private key’ is like a password that gives its owner access to their bitcoin or other digital assets Background: As esoteric as the whole idea of Blockchain and Bitcoin might seems, let us add a new element of mystery to it No one knows who created the Blockchain and bitcoin Well, we do have a name though Satoshi Nakamoto is the name used by the unknown person or people who designed bitcoin and created its original reference implementation

As part of the implementation, they also devised the first blockchain database No one knows who Satoshi Nakamoto is or where he or they reside At this point in time, you might think about what is so incredible about a group of people known only by their unique keys verifying and enabling digital transactions? Put a little more thought into it While the whole idea of anonymous transaction might seem shady, it brings with it a whole new level of transparency like no other It is almost like an oxymoron, but a very helpful one in our case

Let us show you some examples where the blockchain technology might bring about a revolution This can be used to make a transaction of almost anything digital Think about it, blockchain technology can be used almost anywhere where digital multiplicity or digital copying has to be avoided Some real-life examples of blockchain usage are: Our Democracy in the Future(the image ‘democracy’ will take up the whole screen in zoom in position):A company called Horizon State has built a blockchain technology which can be used for votingInstead of transacting bitcoins, this blockchain technology can be used for voting

Every vote cast remains a part of a digital ballot box which cannot be hacked or altered Duplication of votes can also be prevented and voter identity is protected(the image ‘horizon state’ will appear in the background) Forbes has called this technology a global gamechanger which will soon be adopted by political parties Our Energy in the future:(the image ‘future energy’ will appear on the full screen in zoom out position) Last year a group of households in Australia traded excess solar energy that each of them generated with their neighbours using blockchain The amount of energy shared could be verified by the other members of the neighbourhood and part of the blockchain

Here energy was the commodity being traded instead of a cryptocurrency Amazing ain’t it? Now let us look at some frequently asked questions which would help you in your interviews and GD process as well? Is Bitcoin or Cryptocurrency trading legal in India Well let’s say, it is not illegal While it is not banned in India, it is in a grey area The RBI does not stop it but asks the public to be careful while dealing in it What about the rest of the world There are a few countries such as Nepal, Bangladesh, Bolivia, which have banned bitcoins

While there are a number of countries that actively support bitcoin trading Canada, on the other hand, tries to regulate Bitcoins It recently opened a BitCoin ATM Brazil too seems to be accepting it with open arms It passed a law specifically for Electronic Currency in 2013

In most countries, Bitcoin is in the grey area where there is either ambiguity or ambivalence regarding it What are ICOs? ICOs stand for Initial Coin Offerings They are similar to an IPO (Initial Public Offering) of a company An unregulated means by which funds are raised for a new cryptocurrency venture An Initial Coin Offering (ICO) is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks

In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin What is Bitcoin Mining? Bitcoin mining is the process of earning bitcoin using the computational powers of your computer to solve mathematical problems Can Bitcoins be converted into INR or USD? Yes There are a number of bitcoin exchanges that convert your bitcoin and give you the equivalent amount of the currency of your choice What are the benefits of Bitcoins? Bitcoins come with the sense of liberty in the transactions that you make using them

There is no authoritative oversight Also, bitcoin can be traded in exchange markets just like shares of a company What are the drawbacks of Bitcoins? Bitcoins can be used for illegal activities as well These activities could threaten the law and order situation of a country It could give non-state actors a means to send or receive money without fearing that the transactions could be traced back to them

Duke University Energy Conference 2017 – Duke Talks: Energy and Blockchain Technology

– Hi everybody, is this working? Awesome, cool Okay, whoa

It seems like there's a lot of interest in blockchain I got some shout outs in the previous talks, so thanks for that So the way I wanna start is actually just understand a little bit about what you know about blockchain So, who has heard of Bitcoin? Who knows the difference between Bitcoin and Ethereum? Okay, cool, that's good to know I'm gonna talk about blockchain

I'm not going to explain it in detail I was just saying to Keith that it took me a good four months of full time work to understand blockchain in detail, so if you don't understand it, don't worry, you're not behind Just like, get a full time job working on it and four months later you'll be okay (laughs) So I'm not going to explain the technology in detail I will explain sort of the premise of the technology and why it's interesting, I will explain and talk about why it might be useful in the energy sector, and I am going to also talk about what we're doing as Energy Web Foundation to overcome some of the barriers facing blockchain technology in the energy sector

How do I advance slides? Go (audience laughs) That didn't work Oh, this, thank you God, sorry All right cool, so thank you Brad for talking about the shifts that are happening in the energy sector

There is a cost cross that is underway Cost of distributor resources, energy efficiency, down The cost of regular grid infrastructure is not going up necessarily, but the way that it is financed, energy use is going down, or flattening So the relative cost is increasing, shall we say This is affecting the entire industry

Okay, so we've got the distributed resources sitting on the customer end, and we've got these traditional resources sitting on the other end of the spectrum The value, the money should be shifting to the customer Right? It's not It's not, at least as quickly as it could be, or as quickly as it should be Why? The system is designed right now

It's not designed for distributed resources It's not designed for DERs Sorry for all the acronyms

The system is designed for a relationship between utilities and customers A relationship that has been extremely effective at serving all customers, at serving them at lowest cost, and at socializing the good of energy And not double spending There's not five or 10 poles and wires running down the street, there's one So this system has been very effective so far

But it is not working, it's not very effective for the shift that we are seeing to distributed resources We need a system that can enable participation and interaction, customer to customer, prosumer to prosumer – proactive consumer We need that transactive layer, that network, that ability to transact at the distribution edge, where the resources and value is moving Okay? What is the problem with this, with building this transactive system, what is difficult about this? There's a lot of issues, I'm gonna highlight three issues The first, cybersecurity

This is a big challenge, actually To allow devices to interact with each other in a physical system as fragile, as important as the electricity grid, you really do have cybersecurity concerns The second, transaction costs Sure, it's great, let's allow everybody to sell solar to their neighbor If it costs $10 every kilowatt hour to sell, who cares? It's not going to do anything, it's not going to be useful

So keeping transaction costs extremely low is very important to enable any value to be created at the distribution edge The third is a little mushy, but it's multiparty coordination It's very hard for people to coordinate with each other in this peer to peer way That's very challenging It's one of the, if you're familiar with Bitcoin, one of the sort of revolutions of the Bitcoin network

Is that allowed people to interact with each other for currency, as opposed to meeting a bank sitting in between them Okay Not surprisingly, given the topic that I am talking about, we think that blockchain can address these three issues We think because of its sort of inbuilt cryptography, it can address a lot of the concerns around cybersecurity Because there's no intermediary in the system, it's a direct peer to peer interaction through an algorithm, you can't imagine costs that could go lower

And it by its nature is really designed for multiparty coordination So this is why we think blockchain is valuable as a foundation for peer to peer transactions, for supporting grid edge transactions So this is really about creating a market between traditional consumers who are now becoming self generators, who are now participating as suppliers This is very futuristic We're talking transactive energy, we're talking a full remake of the electricity grid

This isn't the only way that blockchain can be valuable in the energy sector There are many applications up and down the energy sector from sort of process improvement side of things, reducing overhead costs, improving something like a utility billing relationship as an example There's plenty of applications in those spaces There's also applications that are truly disruptive, that are sitting on this sort of transactive energy grid True peer to peer electricity transaction side of things

So it's not just the disruptive future, it's also the process improvements where we believe it can be valuable How are people doing so far? Are we with me? You're doing okay? Okay, just checking It's easy to lose people on this topic Okay So there's a lot of value there, there's a lot of value to be captured

It's unclear who is gonna capture it, but there is a lot of value And there's a lot of activity in the blockchain space and in the blockchain energy space There are some real barriers to blockchain scaling in the energy sector The first, and this is a little difficult to grasp for people who are less familiar with the technology But actually, the technology is not there yet

Bitcoin can practice seven transactions a second, Ethereum, the second most used blockchain in the world can process 25 transactions a second That is nothing, that is so low It's not gonna support any applications in the energy sector at 25 transactions a second So the core technology needs to be, there's several advancements that need to be made, especially in scalability for it to support transactions in the energy sector, for it to capture that value in the previous slide The second big barrier is that there is very little examples of physical connection between blockchain and the world

Blockchain is really good at getting agreement on something like a currency, on cutting out a bank and allowing people to transact with trust between each other But it's only as good as the data that is entered And so it's really easy for virtual interactions, but once you start dealing with interactions with the physical world, you have to trust that data coming in, as well That hasn't been solved yet So that's a barrier that's gonna need to be overcome in the physical world of electricity

The third is incumbent adoption There's a lot of big players in the space that can put real capital behind this work and scale it quickly, but they're unfamiliar with the space, they're unfamiliar with the technology And they're not ready to move in and to implement it and to benefit from it And the last is regulatory awareness These regulators and standards making bodies aren't familiar with the technology, they don't understand it that well, they're not ready to regulate around it in a productive way

So I work for the Rocky Mountain Institute which is a non-profit based in Colorado I also work for the Energy Web Foundation The Energy Web Foundation is a joint venture between RMI, a mission driven non-profit organization, and Grid Singularity, which is a blockchain technology company now based in Berlin So we founded the Energy Web Foundation to address these barriers Really, our goal is to create as much value as possible by scaling blockchain in the energy sector

And as RMI, the reason we started Energy Web Foundation is because we believe that it has the potential to scale distributed and renewable resources faster than anything else in the space And we're gonna do it as Energy Web Foundation by building an open source core tech So building the blockchain core that will support the applications at the appropriate speed We're gonna do it by identifying, and assessing, and proving the value of applications to incumbents, to the energy space We're gonna build an ecosystem – we are building an ecosystem

I'm saying all this in the future, I'm used to giving this as a pitch We're already doing this We're building the ecosystem of users, application developers, and infrastructure providers And educating regulators and standards making bodies So this is the work we're doing, these four points

In terms of the role that we intend to play in the market, it is an open source role So we are building what's in blue We are building what we believe should be shared, should be a core, open source foundation, not a competitive space So it's essentially the app store, we're building the app store And the application space, we believe, should be competitive, should be open to competition

This core foundation space is the technology that we are building and will be releasing, open source We think that coming together as a consortium of energy companies and as a group, to build this core technology, is more efficient and more effective, and faster than there being you know, many different proprietary platforms, for every different commercial application has to build its own proprietary core tech platform So our belief is that that core technology platform should be shared and should be open source These are our founding corporate affiliates, so these are the companies that agree with this proposition, want to enter the commercial, competitive space but don't have the core technology support to do it yet And so have funded Energy Web Foundation to build that core tech support and build awareness in the energy sector

And we've actually got another five companies that have joined us in the past few months This is our governance structure If you're familiar with the blockchain space, governance has been a little unruly We have tried to keep a very small governing board for decisions and to not sort of grow and to be an unruly organization So we've got a small governing board between Rocky Mountain Institute and Grid Singularity, and our fifth board member, Christoph Frei, the Secretary of the World Energy Council

Our technology timeline, we actually on the 1st of November released our test network, open source, for use So this is the first iteration of the core technology that we'll be releasing on our go live date, April 2019 In April 2018, we'll be releasing some of the applications and projects that we've been developing with our corporate affiliates over the past few months and onto 2018 That's it I'd love to take your questions

(audience clapping) And feel free to rewind all the way back to the energy, blockchain stuff and why that's important So I think it's just hands up, questions You know, anybody Go ahead – [Audience Member] Are there any pilots of this, like in New York or like Sonnen, is there something in Brooklyn, can you talk about those for a minute? – Sure, so the question was are there any pilots, New York, Sonnen were mentioned

There are some pilots, and there's some really good work that's been done to demonstrate what can be valuable in the energy sector using blockchain So in Brooklyn, there's a Microgrid project whereby several households on a street were connected to a blockchain network and were selling their electricity peer to peer And I almost did air quotes there Because it's a financial transaction They're using Con Edison's poles and wires, it's not a physical transaction of electricity, they're not doing any power flow analysis

But they are matching load curves and understanding and buying and selling peer to peer, financially And that has been a really effective demonstration of how peers can essentially trust each other, use the blockchain shared ledger as a foundation for their transactions Yep (inaudible) So the question was Bitcoin's a currency, is what we're doing a currency as well? The answer is no We also don't want to get into currency risk

What we want to do is to provide the transactive platform, essentially, and if you're familiar with tokens, Bitcoin is a token, is this sort of virtual currency We also will have a token, but the token is only used to pay for transaction costs So it's only used to pay for the computing power to run the network, and it will have a floating exchange rate with US dollars, so you're paying a set amount in US dollars There's no risk of inflating transaction costs Yep

– [Audience Member] So it seems like every day, there's a new company focusing on blockchain Do you have a sense from your perspective of the landscape? What characteristics would make companies have a higher chance of succeeding verses being a good headline? (laughs) – You're asking me for financial advice in your investment company (laughs) So what companies are going to be successful versus less successful in the blockchain space? I think that you really get back to differentiating between companies that have sound fundamentals and those that don't And in the blockchain space there has been a lot of excitement and just in the energy side of things a company recently raised 40 million dollars, another raised 70 million dollars off of nothing, a white paper And that's alarming

I would say just as any other investment, I think that there are business models that make sense, and there are business models that don't make sense And I think there's a lot of excitement, and that's what's leading to some of these investments that maybe don't make as much sense, in my mind – [Woman] I think we have an audience question up in the back – Yeah – [Audience Member] Comment a little bit about transactions cost associated with blockchain, if I understand correctly there is still mining which again requires power, and it's privative for some of the applications, how is that in context for energy? – Absolutely, great question

So transaction costs are extremely high in Bitcoin Bitcoin is driven by a process of reaching consensus in the network, that's called proof of work And that process is very energy intensive It is also totally unnecessary It is the way that they have decided to achieve consensus, but there are other ways that are currently being created and being tested

And our network will be based on a new kind of consensus mechanism called proof of authority, which does not require the energy spend of proof of work, and does not incur the same transaction costs It's really designed in order to keep transaction costs as low as possible – [Woman] Okay, we're gonna do one more question – [Audience Member] Thank you Is your platform gonna be able to work disconnected from the internet, so like in a small pocket such as a developing country, somewhere that doesn't necessarily have you know, broadband access

– Yeah, great question So each node on the network does need to be able to communicate with each other You can use mesh networks, you can use internet, it doesn't matter As long as the nodes on the network essentially And because this is the last question I'm gonna extrapolate a little bit But the core idea of blockchain is that you're getting all of these nodes to agree with each other You're taking the individual idea of truth from every organization, from every person, and instead of it being held individually and then disputed and had legal debates around and audited and all of these things, you're taking that idea of the truth in the network and putting it in the center So that everybody can transact based on the same information that is trusted and agreed upon

And so in order to do that, the nodes just need to be able to communicate with each other in some way Happy to answer more questions over lunch, or in another break, but thanks a lot for having me (audience clapping)

Why Cryptocurrency is the Future [Blockchain Technology THE NEW INTERNET]

welcome back to crypto lands my name is Matthew Timothy if you're new here to this channel I do cryptocurrency videos every single day so if you're into that consider subscribing today I wanted to do a video talking about disruption and adoption and this is freaking awesome I was talking about the disruption in cryptocurrency and blockchain technology and when I got started with cryptocurrency 3 years ago I didn't even know about all this but like blockchain technology is gonna revolutionize everything and I'm not just saying that but look here there's an article coming out I've been saying this by the way if you go back to my other videos you will see I've been saying this blockchain technology for the taxi industry and it will go like this for the the real-estate taxi for everything you can use this like we don't need the centralized garbage anymore telling us what to do pushing us over and to me that's living upon life but hey that's just me blockchain technology in local transportation or taxi industry is only the continuation of an evolution that has gone on for centuries blah blah blah they go on to say that taxis are still there and blah blah blah here benefits of decentralization the introduction of partially decentralized taxi systems like uber and lyft are introduced some necessary competitions into the taxi industries this has provided community commuters with more options leading to reduced fares and better quality surface however despite the extent of decentralization is that is introduced by these systems they are still governed by a single database and run by a single company blockchain takes it a step further as blockchain implementations are speeded speedily sweeping across every industry signs of the technology overtaking the taxi industry are clear already for an industry that has been continually evolving over time across ages moving into a new face will not be a surprising development at all according to Thomas Fela belicus founder of A to B taxi license taxi drivers are essential for the industry for purposes such as security and appraisals the situation in the markets is an inspiration towards the creation of the platform designed to connect customers with professionals accredited drivers directly providing a mobile application for customers to find a licensed driver as well as a driver to manage their business more effectively efficiently will go a long way in creating a sanitized taxi industry it is an essential tool for both the security of commuters and motivation towards quality service implement implementing the concept of tokenization or using blockchain based app apps to manage local transportation systems is a development that has been long coming it's really that it's likely that many taxi servers based on blockchain or tokenization will spring up this is largely due to various benefits of blockchain offers especially in the area of personal control and the decentralization for example imagine traveling to a new city every where the local currency is totally different from where you are coming from and you need a taxi service to make you to take you to the airport or to the hotel from the airport to the hotel using a blockchain powered service automatically eliminates the need for any form of currency conversion as the value of the token remains the same and is available all over the world making this a technology for the common man this is freaky not this is what we've been waiting for basically and this is the future this is where we're going guys and yesterday I was talking with a buddy three years ago ëthere IAM was 72 cent right now it's 462 dollars right now the opportunities are immense we are moving into a future that is gonna be totally different from anything we've seen before and we are still early believe me when I say this we are still early a 462 dollar etherium is freaking cheap so that's basically what I wanted to share in this video I'm freaking excited about this and freaking excited about the future with cryptocurrency and blockchain technology if you're not in it already shame on you and yeah I will see you on the next video probably tomorrow and until then stop settling and start living the coin life please

Advancing and securing transactions in banking with blockchain technology on IBM Z

(upbeat music) – There is a grounds for our round blockchain that is just amazing Wall Street does trillions and trillions of dollars a day, so the consumers are trusting us, we have to ensure that that trust stays with us and that we have the ability to ward off any hack, or attack, or attempt to breach those assets, or those funds, or the equities in trades markets

Z has been notorious for heavy lifting, it's a monster moving massive amounts of data, so blockchain data fits right into that When you have a secure platform that's shared amongst the financial institutions you don't have to worry about that hand off, or that transfer, because it's secure from inception and it's secure through it's transfers

How Blockchain Technology Will Disrupt the World of Retail

Hey and welcome to Retail 90 I'm your host Tom We're hearing a lot about Blockchain at the moment but what even is it? And what could it mean for online retailers? First then the technical part, a blockchain simply records data in chronological order

The difference is the data is never stored centrally but it's distributed across multiple computer networks around the world And because the data base is distributed no one party can ever make any changes so it becomes permanent This makes it ideal for digital currencies such the famous Bitcoin but it's not all about banking the list of uses is growing and diversifying and the potential for retail is huge as well as protecting consumers from fraudulent transactions by creating a smart contract which holds back funds until everyone is satisfied – it can also be used to reduce other types of fraud and build consumer trust It creates a permanent record of a product's journey from supplier to customer so it can prove origin and authenticity whilst improving visibility on the supply chain What about warranties? Blockchain offers the possibility of recording all purchase transactions so no more shoeboxes full of receipts

And when it comes to customer loyalty how about the idea of using blockchain to record loyalty points for awards schemes Blockchain provides a better customer experience and for retailers it streamlines the exchange of information So where will this take us in the future? Well blockchain is likely to be a part of a product's whole life cycle even through to tracking new owners in the case of a resale And while it's hard to build trust in the wild wild west of today's internet Blockchain can fix that issue of trust which for online retailers can only be a good thing

But what do you think? Let us know your thoughts