BLOCKCHAIN DEMO

The workers (or miners) are tasked with uncovering new coins and do this by computing a complex algorithm. Each worker is a powerful computer that runs the blockchain software and helps to keep it running by participating in the relay of information. Anyone can run a worker, you just download the blockchain software and leave a certain port open (the drawback is that it consumes energy and storage space – the bitcoin network at time of writing takes up about 150GB).

The workers take a transaction (or block) and add it to the blockchain. They do this by solving a complex mathematical puzzle and including the answer in the block. The puzzle that needs solving is to find a number that, when combined with the data in the block and passed through a hash function, produces a result that is within a certain range. In this exmaple the puzzle is to find a hash that starts "00f0". Real blockchains, like Bitcoin, have a much harder puzzle to solve.

The number that solves the puzzle is called a “nonce”, which is a concatenation of “number used once.”

The more compute power you have, the more likely you are to find the nonce and claim the reward.

Blockchains can theoretically store anything in a secure and distributed manner. In this example we are storing transactions of the imaginary sdeaghCoin (SDC). Whichever worker can prove the block by guessing the nonce will be rewarded with a random amount (between 1 and 6) of SDC.

Enter your information in the fields and hit transfer. The input data along with the index, the current date and time and the previous hash constitute the block to be 'solved'. This block is passed to all the workers who then attempt to solve the algrorithm, i.e. find the nonce.

In this section you will see the actual blockchain for sdeaghCoin. Each block has been calculated so that the hashed value of the data, the previous block's hash, the index and the nonce start with '00f0'

The security of the blockchain comes from having a distributed system and the 'chain' effect of always using the previous hash in the new calculation. If somebody attempted to modify some of the saved data the calculation of the nonce would no longer be valid - it would require a different nonce to make the hash start with '00f0. Other workers or nodes in the distributed system would pick this up and invalidate the change.