SENS4553-Blockchain

Essentials
Dr. Abdullah Yousafzai
Instructor
DR ABDULLAH YOUSAFZAI

Associate Professor, Faculty of IT

Post Doctorate (Blockchain and Federated Learning)

Kyung Hee University, South Korea.
PhD (Computer Science)
Distributed Systems (Mobile Computing)
University of Malaya, Kuala Lumpur, Malaysia.
MS (Computer Science)
Distributed Systems (Content Delivery Networks)
CUI Abbottabad
BS (Computer Science)
Hazara University, Mansehra.

[email protected]

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Our Objective at UCP
UCP’s Vision
To become an internationally acclaimed University in teaching and research.
UCP’s Mission
To provide quality education leading to research, employability and
entrepreneurial pursuits creating societal impact, serving the nation and the
world.

BSSE -- PEOs
PEO 1– Contribute effectively to software development industry by the
application of requisite technical skills.
PEO 2– Demonstrate advancement in the field of software engineering by
enhancing their knowledge and skills.
PEO 3– Demonstrate ethical values and contribute positively towards the
society.

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UCP Core Values(‫بنیادی‬
‫)اقدار‬
Integrity: We put honesty and ethical responsibility at the core of
everything we do.
Respect: We treat everyone with dignity and value the wisdom and
expertise of the people that surround us.
Tolerance: We accept the existence of different views, ideas, and people
even if we may disagree with them.
Commitment: We are passionate and determined to work hard in order
to achieve our goals.
Service: We believe in helping our community and working together to
empower each other.
Creativity: We celebrate innovation and encourage new ways to think.

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 Course Methodology
Lectures
16 power point lectures
Study relevant sections of Text/Ref books
Assignments
Assignment should done on individual basis
To be submitted exactly when due according to the direction.
10% marks deduction per day for being late.
No submission after 5 days (120 hours).
Quizzes
Un-announced.
No make-up for quizzes

Exam Pattern
Exams to include complete material in covered chapters
MCQs, short answers, problems, design questions

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Academic Honesty
Your work in this class must be your own
If students are found to have:
◦ collaborated excessively, or
◦ copied/shared answers

For the first infraction…

◦ all involved will, at a min,
receive grades of 0
Further infractions…
◦ will result in failure in course

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Classroom Etiquettes
Attendance policy strictly in accordance with the Univ policy.

If you come 10 – 20 minutes late, you will be marked late otherwise absent – no relaxation.

Bring your own calculator and stationary.

Usage of Mobile phones is strictly prohibited in the class.
Everyone must come with a copy and pen to record his notes.
No disturbance!!!! No Misconduct!!!!
If you do not understand a point, raise your hand and ask me to explain or contact during
counselling hours.
REMEMBER: Your first priority must be your studies

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Administrative
Information
Office : Cabin 16, Gym Building.
Counselling Hours : 12:55-13:55 (Tuesday)
Email : [email protected].
Phone, I generally prefer to communicate on emails so if you
found my number don’t call/message.
Prior appointment is mandatory for coming to my office during
counselling hours.
Saturday & Sunday is OFF, so no one will be entertained on OFF
days.

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 Grading Policy
Quizzes (Average of all) 04 15%
Assignments (Average of all) 04 10%
Project 10%
Mid-exam ..….…. 20%
Final-exam .……… 40%
Class participation ..….…. 05%
Class Participation means how much you adhere to behavioral
conduct (noise making, murmuring).
This will be monitored/recorded for each student.

Distribution is tentative and flexible

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 What is
Blockchain
?
Why a course on
Blockchain?
•Have you seen the news lately?
•Bitcoin
•Ethereum
•Solana
•Blockchain for supply chain management
•Blockchain for energy management ……
•Soon: Block chain for Everything
•Is it just a hype?
•Hopefully this course will teach
•Even if you do not care about cryptocurrency and its
market volatility

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Let’s First talk about
Banking
Regulatory Agency
(State Bank of Pakistan)

Customers Bank Employee

Bank

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How do you transact?
•You write a check or do internet transaction to pay a payee
•Bank checks if you have balance > transaction amount
•If yes, it debits your account by
• balance = balance ‐ transaction_amount
•credit’s payee’s account by.
• balance = payee.balance + transaction_amount

•If no, the transaction is invalid and rejected.

•You can check your transaction list online, or check the monthly statement
•Who maintains the ledger?
•Bank Does
•What if Bank allows an invalid transaction go through
• Invalid = you did not authenticate the transaction
• Invalid = your balance was not sufficient but transaction was made

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Bank Frauds
•You find a check was used to pay someone but you never wrote the check
• Someone forged your check and/or signature
•You did sign a check for x amount, but the amount field was modified
• How do you prove to the bank that an extra 0 was not there in your signing time?
•The monthly statement says that you did a transaction but you did not recall or
the amount of a transaction is different from what you had done
• Someone got your password, and possibly redirected OTP to another SIM (SIM Fraud)
• Bank employees themselves might have done something
•How do you argue to the bank? (Non‐repudiation)
•How do you argue that the amount was modified? (Integrity)
•Finally, do you tally your transactions when you receive your monthly
statement?
• Most people do not

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Digital Currency
Idea

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Digital Currencies
• Origins of digital currencies date back to the 1990s Dot-com bubble.
• Precursory ideas for digital currencies were presented in electronic
payment methods such as the Sabre (travel reservation system).
• In 1983, a research paper titled "Blind Signatures for Untraceable
Payments" by David Chaum introduced the idea of digital cash.
• e-gold was the first widely used Internet money, introduced in 1996,
and grew to several million users before the US Government shut it
down in 2008.
• Another known digital currency service was Liberty Reserve,
founded in 2006;
• Q coins or QQ coins, were used as a type of commodity-based
digital currency on Tencent QQ's messaging platform and emerged
in early 2005.
Cryptocurrencies
• A whitepaper posted online in 2008: “Bitcoin: A Peer-to-Peer
Electronic Cash System,” by Satoshi Nakamoto.
• Described a distributed cryptocurrency system not regulated by any
government.
• The system went live on January 2009.
• Now “Satoshi Nakamoto” is only associated with certain public keys
on Bitcoin blockchain.
• She/He/They was/were active on forums/emails/etc. until 2010.
• Currently there are more than 22000 cryptocurrencies

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Cryptocurrencies
• The use of cryptographic primitives and distributed
consensus protocols to secure virtual money creation and
flow between various parties.
• “A type of unregulated, digital money, which is issued and
usually controlled by its developers, and used and accepted
among the members of a specific virtual community” -
European Central Bank.

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Blockchain
• An append only ledger.
• Simply an immutable record of all transactions and actions
performed in the system so far.
• Each page of this ledger is called a block.
• These pages are glued together by using a hash chain.
• Adding a new page on the ledger is done through a process called
mining.

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Utility of Blockchains
• Initially, the goal was to build a decentralized virtual currency
medium.
• Interest has shifted towards providing a decentralized service on top
of this medium.
• Lately blockchains on their own (without involving any currency) are
used in several applications.
• Mainly to support transparency and public verifiability.
• Examples include healthcare, business management, and supply
chains.

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 What is Blockchain?
 It is data structure
 It looks like a linked list
 It is Replicated.
 It is Distributed.
Consistency maintained by Consensus
Cryptographically linked
Cryptographically assured integrity of data
 Used as
 Immutable Ledger of events, transactions or time stamped data
 Tamper resistant log
 Platform to Create and Transact in Cryptocurrency
 log of events/transactions unrelated to currency

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Other Applications: Land
Record
•You buy a piece of land
•Someone else claims to own the land
•But the one who sold you the land showed you paper work
•Land registry office earlier said that the owner was rightful
•Now they say that they made a mistake – it was owned by
the other person
•You already paid for the land – to the first person
•First person goes missing
 How does any one prove who changed the land record?
•The government employees?

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A student Online Grade
Submission and
Management System

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Perspectives

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Why not bitcoin?

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Why not bitcoin?

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Why not bitcoin?

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Another perspective – Loss of 145 USD worth cryptocurrency

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Another perspective

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Bitcoins and other cryptocurrencies

•Too much interest by investors to park their assets

•Less use as a medium of value exchange
•Private Key stealing or private keys at exchanges — risk
•Coding vulnerabilities — risk
•Volatility
•Energy Waste — climate impact
•Too much concentration in one country — risk
•Regulatory risk
•Usage for criminal activities — Silk Road

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Again, What is a blockchain?

Blockchain technology is a digital innovation that has

the potential to significantly impact trusted
computing activities and therefore cybersecurity
concerns as a whole.
•Attractive properties of Blockchain
•Log of data with digital signature
•Immutable (once written – cryptographically hard
to remove from the log)
•Cryptographically secure – privacy preserving
Provides a basis for trusted computing on top of
which applications can be built

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