Blockchain Technology: From Theory to Practice

421 Pages·2022·11.397 MB·English

by  Sudeep Tanwar

Studies in Autonomic,
Data-driven and Industrial Computing
Sudeep Tanwar
Blockchain
Technology
From Theory to Practice
Studies in Autonomic, Data-driven
and Industrial Computing
SeriesEditors
SwagatamDas,IndianStatisticalInstitute,Kolkata,WestBengal,India
JagdishChandBansal,SouthAsianUniversity,Chanakyapuri,India
The book series Studies in Autonomic, Data-driven and Industrial Computing
(SADIC)aimsatbringingtogethervaluableandnovelscientificcontributionsthat
address new theories and their real world applications related to autonomic,
data-driven, and industrial computing. The area of research covered in the series
includes theory and applications of parallel computing, cyber trust and security,
grid computing, optical computing, distributed sensor networks, bioinformatics,
fuzzycomputinganduncertaintyquantification,neurocomputinganddeeplearning,
smart grids, data-driven power engineering, smart home informatics, machine
learning,mobilecomputing,internetofthings,privacypreservingcomputation,big
dataanalytics,cloudcomputing,blockchainandedgecomputing,data-drivengreen
computing, symbolic computing, swarm intelligence and evolutionary computing,
intelligent systems for industry 4.0, as well as other pertinent methods for
autonomic,data-driven,andindustrialcomputing.
Theserieswillpublishmonographs,editedvolumes,textbooksandproceedings
of important conferences, symposia and meetings in the field of autonomic,
data-drivenandindustrialcomputing.
Moreinformationaboutthisseriesathttps://link.springer.com/bookseries/16624
Sudeep Tanwar
Blockchain Technology
From Theory to Practice
SudeepTanwar
DepartmentofComputerScience
andEngineering
InstituteofTechnology
NirmaUniversity
Ahmedabad,India
ISSN 2730-6437 ISSN 2730-6445 (electronic)
StudiesinAutonomic,Data-driven andIndustrialComputing
ISBN 978-981-19-1487-4 ISBN 978-981-19-1488-1 (eBook)
https://doi.org/10.1007/978-981-19-1488-1
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Thisbookisdedicatedtomymomanddad,
Mrs.SnehLataTanwarandLateSh
JanardhanTanwar,whogavemeexistencein
thisbeautifulworld;mysiblings(Pradeep
TanwarandSandeepTanwar),who
encouragemewithadmiration; mywife
Anshul,whostrengthensmysoulwithlove
andinspiresmetoalwaysworktoward
perfection;andmysweetdaughterAmodita
andinnocentsonDivit,whoenlightenme
withjoyeveryday.
Personally,fromthecoreofmyheart,Iwould
liketodedicatethisbooktoallmembersof
STLab,especiallyRajeshGupta,AnujaNair,
NileshJadav,TejalRathod,RiyaKakkar,
JignaHethaliya,andUmeshBodkhe,for
their24by7supporttoconvertthisbookinto
reality.Withouttheirsupport,itwouldnot
havebeenpossibleformetocompletethis
booktimely.
IamfinallydedicatingthisbooktoProf.(Dr.)
NeerajKumarandDr.Sudhanshu Tyagifor
alwaysmotivating metoaccelerateinall
dimensionsofresearchanddevelopment.
—Prof.(Dr.)SudeepTanwar,Ahmedabad,
Gujarat,India
Preface
Blockchain is an emerging technology platform for developing decentralized
applications and data storage, over and beyond its role as the technology under-
lying the cryptocurrencies. The basic tenet of this platform is that it allows one to
create a distributed and replicated ledger of events, transactions, and data gener-
ated through various IT processes with strong cryptographic guarantees of tamper
resistance,immutability,andverifiability.Furthermore,publicblockchainplatforms
allowustoguaranteethesepropertieswithoverwhelmingprobabilitiesevenwhen
untrustedusersareparticipantsofdistributedapplicationswiththeabilitytotransact
ontheplatform.
Eventhoughblockchaintechnologyhasbecomepopularlyknownbecauseofits
use in the implementation of Cryptocurrencies such as Bitcoin and Ethereum, the
technologyitselfholdsmuchmorepromiseinvariousareassuchastimestamping,
logging of critical events in a system, recording of transactions, and trustworthy
e-governance. Moreover, many researchers are working on use cases such as
decentralizedpublic-keyinfrastructure,self-sovereignidentitymanagement,registry
maintenance, health record management, decentralized authentication, diamond
industry,andtelesurgery.Also,corporationslikeIBMandMicrosoftaredeveloping
theirapplicationsindiversefieldssuchastheInternetofThings(IoT),evenenabling
blockchainplatformsonthecloud.
Considering the need to disseminate the emerging concepts to students of
UG/PG/Ph.D.,researchers,andblockchaindevelopers,Idecidedtowriteacomplete
reference book on blockchain technology: From Theory to Practice. The main
benefitsofthisbooktothereadersareasfollows:
(cid:129)
It introduces theoretical and implementation aspects of blockchain technology,
whichcontainsallthenecessarymaterialtobecomeablockchaintechnicalexpert.
(cid:129)
Itincludesanin-depthinsightintotheneedfordecentralization,smartcontracts,
consensusbothpermissionedandpermissionless,andvariousblockchaindevel-
opment frameworks, tools, and platforms such as Ethereum, Bitcoin, and
HyperledgerFabric.
vii
viii Preface
(cid:129)
Itcanbeusedasatextbookforcoursesrelatedtoblockchaintechnologyandcryp-
tocurrencies.Itcanalsobeusedasalearningresourceforvariousexaminations
andcertificationsrelatedtocryptocurrencyandblockchaintechnology.
(cid:129)
Almosteverychaptercoversanin-depthimplementationofvariousconceptsof
blockchaintechnology.
Thisbookisthefirst-ever‘how-to’guideaddressingoneofthemostoverlooked
practical, methodological, and moral questions in any nations’ journey to manage
the trust among various stakeholders: What is a distributed technology, what are
its properties, what it means to have consensus in a distributed system, an under-
standing of foundational consensus algorithms (e.g., PoW, PoB, PBFT, etc.), and
why Nakamoto Consensus is a big revolution for smart applications, which have
multi-partyenvironment?HowBlockchaincancompletelytransformthislandscape
and what are the existing pieces of work who are working on this, what are they
doing,anditgivesyouasenseofwhereweareandhowsomeofthefirstproduction
networksarecomingoutinthisarea.Howtoensurescalabilityandcomputingeffi-
ciency?ItdiffersfromotherpublishedbooksaloneonBlockchainTechnologyasit
includesadetailedimplementationonalmostallaspectsofBlockchainTechnology
and comparative case studies concerning various performance evaluation metrics,
such as scalability, accessibility, reliability, heterogeneity, and Quality of Service
(QoS) requirements. This book explained the nuts and bolts of blockchain tech-
nology in lucid language to make students more familiar with the implementation
perspectiveofthismuch-neededtechnology.
This book is organized into fourteen chapters, and a brief description of each
chapterisasfollows:
Chapter 1 “Introduction to Blockchain Technology” discusses the basic funda-
mentalsofblockchaintechnologythatcanbringtrustandreliabilityinvariousbusi-
nessoperations.Itcoversbasicconceptsofblockchain,thestructureofblockchain,
different types of blockchain, smart contracts, consensus mechanism, and the
working of blockchain. Moreover, it briefly introduces all possible development
toolsandplatformstoimplementblockchain-basedsolutions.
Chapter 2 “Blockchain Revolution from 1.0 to 5.0: Technological Perspective”
presentsthehistoricalperspectiveofblockchaintechnologyrangingfrom1.0to5.0.
Itdiscussesthedifferentformsofblockchainwithitsmotivation,benefits,andimple-
mentationtotransformbusinessoperationsinatrusted,safe,andsecureenvironment.
Finally,itshowsacomparativeanalysisofdifferentgenerationsofblockchain.
Chapter 3 “Decentralization and Architecture of Blockchain Technology”
describesthepotentialimpactofdecentralizationinthecurrentbusinessenvironment
and discusses decentralization methods, i.e., Disintermediation and Competition.
Moreover,theadopteddecentralizationneedstobemeasured;therefore,wepresent
adecentralizationindexthatmeasuresthecorrectnessofthedecentralization.Lastly,
we have included some recent use cases which have incorporated decentralization
intotheirbusinessmodels.
Chapter 4 “Basics of Cryptographic Primitives for Blockchain Development”
explores cryptography’s preliminaries, which are the basic building blocks for
Preface ix
blockchain development. It primarily covers different types of hash functions:
SHA,RIPEMD,Scrypt,andEthash,digitalsignaturescomprisingECDSA,Schnorr,
Multisignature,Ringsignature,andencryptionstandards.Finally,thischaptershows
theformalECDSA-basedsecp256k1implementationforbitcoinapplications.
Chapter5“SmartContractsforBuildingDecentralizedApplications”discusses
thebasicconceptsofsmartcontractsalongwiththeirprosandcons.Themajorfocus
ofthischapterisontheimplementationofsmartcontractsusingSoliditylanguage.
ThischaptercoversbasicprimitivesofSoliditylanguage,suchasarrays,functions,
andstructures.Fromtheimplementationpointofview,thischapterpresentsvarious
case studies, such as telesurgery, oil mining, banking, voting, and remote patient
monitoring.
Chapter 6 “Distributed Consensus for Permissionless Environment” describes
variousconsensusmechanismswiththeirmeritsanddemerits.Thischapterbriefly
discussesvariousconsensusalgorithmssuchasProofofWork(PoW),ProofofStake
(PoS),ProofofBurn(PoB),ProofofCapacity(PoC),andProofofOwnership(PoO)
along with their comparative analysis, merits, and demerits. Moreover, it presents
thepython-basedimplementationofPoW,PoB,andPoOconsensusalgorithms.
Chapter7“MiningProcedureinDistributedConsensus”discussestheneeds,tech-
nicalities,andproceduresformininganodeintheblockchainnetwork.Itdiscusses
how the incentive is distributed among the miners upon mining a block and the
concept of a mining pool. From the implementation point of view, this chapter
presentsimplementationdetailsoftheminingprocedureforPoWwithblockmining
andrewarddistribution.
Chapter8“DistributedConsensusforPermissionedBlockchain”focusesoniden-
tifyingthepracticalaspectandtheadvantagesanddisadvantagesofconsensusproto-
cols.Theprotocolsarebisectedintotwo,thatisproof-basedandvoting-basedalgo-
rithms,whichaimtosolveByzantinefaults.Thischaptercoversalgorithms,suchas
PAXOS,RAFT,PBFT,DBFT,andFBFT.Furthermore,itshowstheimplementation
of Leslie Lamport’s algorithm for three general Byzantine problems and Proof of
Authority(PoA).
Chapter9“ConsensusScalabilityinBlockchainNetwork”discussestheimprove-
mentsinconsensusmechanismintermsofscalability,suchasthescalabilityofPoW
consensus mechanism can be improved with Bitcoin-NG. This chapter discusses
various scalable consensus mechanisms, such as Helix-based, RPoC reputation-
based, and EBRC framework. Finally, this chapter highlights various bottlenecks
ofscalingtheconsensusmechanism.
Chapter 10 “Building Trust in Blockchain Network Using Collective Signing”
discusses the implications of collective signing in the blockchain network, which
eradicatesthemalicioustoprotecttheauthenticregulatorybodies.Ithighlightsthe
architecture of collective signing (CoSi) and Byzcoin protocol in the multi-party
environmenttovalidatethedigitalsignatureandimprovetheblockchain’sscalability.
Chapter11“AdoptionofBlockchaininEnterpriseComputing”discussesthebasic
concept of enterprise computing and also highlights the need for blockchain tech-
nology in it. From the implementation point of view, this chapter presents various
x Preface
case studies for enterprise computing, such as diamond supply chain, DigiLocker,
transportationservices,fooddeliveryservice,andrestaurantmanagement.
Chapter12“BlockchainforSupplyChainManagement”describesblockchain’s
basicrequirementandusageinsupplychainmanagementtoprovidesecurity,trans-
parency, and traceability in the network. It describes the basic research areas of
adopting blockchain in supply chain management. It shows the implementation
details of the food supply chain, wall mart industry, and drug logistics process
utilizingtheblockchainsmartcontract.Finally,itpresentsthedifferentcasestudies
ofsupplychainmanagementwithblockchain.
Chapter 13 “Blockchain for Government Services” presents the application of
blockchainingovernmentservicessuchasVATtax,payrolltax,transferpricing,and
incometax.Further,itexplorestheadvantagesofutilizingblockchainingovernment
services.Itdiscussesthedifferentcasestudiesofblockchainfortaxationandland
registryrecordsandtheGSTprocesswithandwithoutblockchain.Finally,itshows
the basic implementation of land registry records by implementing the blockchain
smartcontract.
Chapter 14 “Impact of Blockchain on Academic Publishing” discusses the
potential of blockchain technology in open-access academic publishing. It high-
lights the benefits of using blockchain technology with its key technologies such
as smart contracts, digital rights, cryptocurrencies, and identity management. It
shows the different case studies to apply blockchain technology in open-access
publishing.Finally,itshowstheimplementationdetailsofblockchainusingSolidity
inopen-accesspublishingandthedifferentchallengesassociatedwithit.
The author is very thankful to all the members of Springer, especially Mr.
AnindaBose,fortheopportunitytowriteabookfocusedonvariousimplementation
perspectivesofBlockchainTechnology.
Ahmedabad,India Dr.SudeepTanwar