The Building Blocks of Blockchain Technology — Networks + Ledgers + Cryptography

The Building Blocks of Blockchain Technology — Networks + Ledgers + Cryptography

In this module, we will explore some of the the Building Blocks of Blockchain Technology — Networks + Ledgers + Cryptography

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Daniel Martin Katz

February 20, 2018
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  1. @ computational professor daniel martin katz danielmartinkatz.com BLOCKCHAIN, CRYPTOCURRENCY AND

    LAW professor nelson rosario THE BUILDING BLOCKS OF THE BLOCKCHAIN — NETWORKS + LEDGERS + CRYPTOGRAPHY nelsonmrosario.com @ nelsonmrosario BLOCKCHAINLAWCLASS.COM
  2. DANIEL MARTIN KATZ E D U | I L L

    I N O I S T E C H + S TA N F O R D C O D E X B LO G | C O M P U TAT I O N A L L E GA L S T U D I E S . C O M PAG E | DA N I E L M A R T I N K AT Z . C O M C O R P | L E X P R E D I C T. C O M NELSON ROSARIO B LO G | L AWO F C RY P TO C U R R E N C Y. C O M PAG E | N E L S O N M RO S A R I O . C O M F I R M | M A R S H A L L I P. C O M BLOCKCHAINLAWCLASS.COM L A B | T H E L AW L A B . C O M E D U | I L L I N O I S T E C H - C H I C AG O K E N T L AW
  3. BLOCKCHAINLAWCLASS.COM BLOCKCHAIN AND CRYPTOCURRENCY

  4. BLOCKCHAINLAWCLASS.COM BLOCKCHAIN CRYPTOCURRENCY A CHAIN OF CRYPTOGRAPHICALLY LINKED BLOCKS OF

    TRANSACTIONS UNIQUE DIGITAL PROPERTY TRANSACTED ON A DECENTRALIZED PEER TO PEER TRANSACTION NETWORK
  5. THE BUILDING BLOCKS OF BLOCKCHAIN TECHNOLOGY BLOCKCHAINLAWCLASS.COM

  6. LEDGERS CRYPTOGRAPHY NETWORKS + + CONSENSUS + } BLOCKCHAINLAWCLASS.COM INCENTIVES

    + {
  7. LEDGERS CRYPTOGRAPHY NETWORKS + + CONSENSUS + } BLOCKCHAINLAWCLASS.COM BLOCKCHAIN

    APPLICATIONS = INCENTIVES + {
  8. LEDGERS CRYPTOGRAPHY NETWORKS + + CONSENSUS + } BLOCKCHAINLAWCLASS.COM BLOCKCHAIN

    APPLICATIONS = INCENTIVES + {
  9. THE BUILDING BLOCKS OF BLOCKCHAIN TECHNOLOGY BLOCKCHAINLAWCLASS.COM NETWORKS - ALLOW

    US INTERACT / COMMUNICATE LEDGERS - LET US TRACK THINGS CRYPTOGRAPHY - HELPS US SECURE THINGS (*NOTE* NOTHING CAN EVER BE PERFECTLY SECURE)
  10. BLOCKCHAINLAWCLASS.COM LETS TAKE A BIT OF A DEEPER DIVE

  11. BLOCKCHAINLAWCLASS.COM NETWORKS

  12. BLOCKCHAINLAWCLASS.COM TODAY MANY PEOPLE THINK OF SOCIAL NETWORKS AS NETWORKS

  13. BLOCKCHAINLAWCLASS.COM MAPPING FACEBOOK NETWORK HTTPS://WWW.FACEBOOK.COM/NOTES/ FACEBOOK-ENGINEERING/VISUALIZING- FRIENDSHIPS/469716398919

  14. BLOCKCHAINLAWCLASS.COM

  15. BLOCKCHAINLAWCLASS.COM BUT NETWORKS ARE ALL AROUND US

  16. BLOCKCHAINLAWCLASS.COM SOCIAL DYNAMICS OF HIGH SCHOOLS JAMES MOODY, RACE, SCHOOL

    INTEGRATION, AND FRIENDSHIP SEGREGATION IN AMERICA, AMERICAN JOURNAL OF SOCIOLOGY 107, 679-716 (2001)
  17. BLOCKCHAINLAWCLASS.COM NICHOLAS A. CHRISTAKIS AND JAMES H. FOWLER, THE COLLECTIVE

    DYNAMICS OF SMOKING IN A LARGE SOCIAL NETWORK, 358 NEW ENGLAND JOURNAL OF MEDICINE 2249 (2008) SOCIAL DYNAMICS OF SMOKING
  18. BLOCKCHAINLAWCLASS.COM JOHN KELLY AND BRUCE ETLING, MAPPING IRANʼS ONLINE PUBLIC:

    POLITICS AND CULTURE IN THE PERSIAN BLOGOSPHERE, BERKMAN CENTER FOR INTERNET AND SOCIETY AND INTERNET & DEMOCRACY PROJECT, HARVARD LAW SCHOOL (2008) MAPPING IRAN’S BLOGOSPHERE
  19. BLOCKCHAINLAWCLASS.COM SPECIAL ISSUE - COMPLEX SYSTEMS AND NETWORKS, 325 SCIENCE

    5939 (2009)
  20. BLOCKCHAINLAWCLASS.COM MARK NEWMAN, NETWORKS: AN INTRODUCTION. OXFORD UNIVERSITY PRESS (2010)

    (A VERY GOOD AND FAIRLY COMPREHENSIVE TREATMENT)
  21. BLOCKCHAINLAWCLASS.COM INDEED NETWORKS ARE EVEN WITHIN US

  22. BLOCKCHAINLAWCLASS.COM M. K. GANAPATHIRAJU, M. THAHIR, A. HANDEN, S. N.

    SARKAR, R. A. SWEET, V.L. NIMGAONKAR & S. CHAPARALA, SCHIZOPHRENIA INTERACTOME WITH 504 NOVEL PROTEIN–PROTEIN INTERACTIONS, 2 NPJ SCHIZOPHRENIA16012 (2016)
  23. BLOCKCHAINLAWCLASS.COM HAGMANN P, CAMMOUN L, GIGANDET X, MEULI R, HONEY

    CJ, WEDEEN VJ, SPORNS O, MAPPING THE STRUCTURAL CORE OF HUMAN CEREBRAL CORTEX. PLOS BIOLOGY VOL. 6, NO. 7, E159 (2008)
  24. BLOCKCHAINLAWCLASS.COM AND IN LAW LAW LAND AS WELL

  25. has spread from its ysical sciences into cial sciences (1).

    In- cial sciences frame from the financial d system as complex ) and urge policy- olutions with What is often se initiatives also complex st as it seems ory measures AS properties or regulation, o appreciate ystems yield nrealistic as- ng empirical w, there has exity science. cal studies of searchers are ngly evident cientific sup- ch agenda to gap and ad- ons. t what com- y as hallmark e diverse in- res, agencies, due process, actors (e.g., and judges); regulations, are intercon- tic processes s, and rule- mechanisms ourts and ju- n). These are all em- and nonhierarchical e.g., cross-references ns and judicial opin- ies of federal, state, stitutions) that fre- ganizing properties exercise bounded rationality, have only par- tial information, and are able to exercise only varying degrees of control on overall system behavior (2). Efforts to integrate CAS approaches to regulated systems may flounder if complex adaptive characteristics of the legal system it- self are not taken into account. For example, although natural-resources policy theorists have advocated for a new field of adaptive management based on an understanding that ecosystems are CAS, agencies, courts, and other components of the legal system have reacted in unexpected ways that can frustrate adaptive management (3). Legal systems are locked in perpetual co- evolution with their regulatory targets. Co- adaptive dynamics have driven growth in structure and size, punctuated with stages of nonlinear expansion of the U.S. statutory was a factor in the 2008 financial crisis (5) and the Deepwater Horizon oil spill (6). THEORY, ANALYSIS, APPLICATION Application of informatics and big-data– styled research to law offers many potential benefits for conventional empirical legal studies. The CAS framework is neither an extension of nor a replacement for that ap- proach but a different way of envisioning systems in which agent strategies and sys- tem structures evolve, with outcomes stan- dard game theory and equilibrium analyses would not predict (7). Although well behind CAS research in other social sciences, re- searchers have begun to map CAS concepts onto the legal system (2). Researchers are applying empirical tools of complexity sci- ence to understand how to measure, moni- tor, and manage the legal system as a CAS. U.S. Supreme Court term Percentage of cases contained within giant component Giant component (%) 60 1805 1810 1810 1815 1820 1820 1825 1830 1830 1835 50 40 30 20 10 0 United States Supreme Court citation network (1805–1835) Cases are represented as nodes, citations between cases as edges. Emergence of a giant [connected] component after 1815, a hallmark phenomenon in complex systems, represents a transition from jurisprudential reliance on foreign to domestic law following the War of 1812 (4). We include all cases that had been cited at least once over the Court’s history (1791–2015). For figure code and data, see https://github.com/mjbommar/legal-complexity-science. Nashville, TN 37203, USA. cago-Kent College of Law, he Stanford Center for 05, USA. Email: jb.ruhl@ 31 MARCH 2017 • VOL 355 ISSUE 6332 1377 3/29/17 11:31 AM Published by AAAS on March 30, 2017 http://science.sciencemag.org/ Downloaded from J.B. Ruhl, Daniel Martin Katz & Michael Bommarito, Harnessing Legal Complexity, 355 Science 1377 (2017) Michael Bommarito, Daniel Martin Katz, Jonathan Zelner & James Fowler, Distance Measures for Dynamic Citation Networks 389 Physica A 4201 (2010) BLOCKCHAINLAWCLASS.COM
  26. BLOCKCHAINLAWCLASS.COM (a) Christian Sternitzke, Adam Bartkowski & Reinhard Schramm, Visualizing

    Patent Statistics by Means of Social Network Analysis Tools. 30 World Patent Information 115 (2008) (a) (b) (b) Daniel Martin Katz & Michael Bommarito, Measuring the Complexity of the Law: The United States Code, 22 Journal of Artificial Intelligence & Law 1 (2014) (c) Daniel Martin Katz & Derek Stafford, Hustle and Flow: A Social Network Analysis of the American Federal Judiciary, 71 Ohio State Law Journal 457 (2010) (c)
  27. BLOCKCHAINLAWCLASS.COM NETWORKS ARE AS OLD AS HUMANS

  28. BLOCKCHAINLAWCLASS.COM A.A. WHITE, THE SOCIAL NETWORKS OF EARLY HUNTER- GATHERERS

    IN MIDCONTINENTAL NORTH AMERICA. PH.D. DISSERTATION: UNIVERSITY OF MICHIGAN (2012)
  29. BLOCKCHAINLAWCLASS.COM NETWORKS - A DEFINITION PEOPLE/SOCIAL - AN INTERCONNECTED ASSOCIATION

    OR GROUP OF PERSONS THOSE INDIVIDUALS MIGHT SHARE INFORMATION AND RESOURCES
  30. BLOCKCHAINLAWCLASS.COM A FAMILY IS A NETWORK

  31. BLOCKCHAINLAWCLASS.COM A TRIBE OR VILLAGE IS A NETWORK JAIME IRANZO,

    JAVIER M. BULDÚ & JACOBO AGUIRRE, COMPETITION AMONG NETWORKS HIGHLIGHTS THE POWER OF THE WEAK, 7 NATURE COMMUNICATIONS 13273 (2016).
  32. BLOCKCHAINLAWCLASS.COM CITIES AND REGIONS (AS WELL AS COUNTRIES) CAN BE

    THOUGHT OF AS NETWORKS C. HERRERA-YAGÜE, C. M. SCHNEIDER, T. COURONNÉ, Z. SMOREDA, R. M. BENITO, P. J. ZUFIRIA & M. C. GONZÁLEZ, THE ANATOMY OF URBAN SOCIAL NETWORKS AND ITS IMPLICATIONS IN THE SEARCHABILITY PROBLEM, 5 SCIENTIFIC REPORTS 10265. (2015)
  33. BLOCKCHAINLAWCLASS.COM AS WE HAVE NOTED IN PRIOR MODULES, MUCH OF

    HUMAN HISTORY CONCERNS SCALING TRUST AND GROWING NETWORKS
  34. BLOCKCHAINLAWCLASS.COM THE WAY TRUST HAS BEEN SCALED THROUGH THE USE

    OF COORDINATION TECHNOLOGY
  35. COORDINATION TECHNOLOGY BLOCKCHAINLAWCLASS.COM WRITING TELEGRAPH TELEPHONE THE INTERNET BLOCKCHAIN APPLICATIONS?

  36. BLOCKCHAINLAWCLASS.COM HOWEVER IT IS THE NETWORKED INFRASTRUCTURE THAT IS OF

    GREATEST INTEREST HERE
  37. BLOCKCHAINLAWCLASS.COM FOR OUR PURPOSES WE ARE CONCERNED WITH COMPUTER NETWORKS

  38. BLOCKCHAINLAWCLASS.COM NETWORKS - A DEFINITION REVISITED AN INTERCONNECTED ASSOCIATION OR

    GROUP OF PERSONS PEOPLE :
  39. BLOCKCHAINLAWCLASS.COM NETWORKS - A DEFINITION REVISITED AN INTERCONNECTED CHAIN, GROUP

    OR SYSTEM TECH :
  40. BLOCKCHAINLAWCLASS.COM NETWORKS - A DEFINITION REVISITED COMPUTER NETWORK : DIGITAL

    TELECOMMUNICATIONS NETWORKS THAT ALLOW COMPUTERS TO SHARE RESOURCES/INFORMATION
  41. BLOCKCHAINLAWCLASS.COM THE MOST WELL KNOWN COMPUTER NETWORK IS THE INTERNET

  42. BLOCKCHAINLAWCLASS.COM COMPUTER NETWORKS ARE ORGANIZED ACCORDING TO PROTOCOLS

  43. BLOCKCHAINLAWCLASS.COM PROTOCOLS ARE A SET OF RULES FOR HOW INFORMATION

    SHOULD BE HANDLED
  44. BLOCKCHAINLAWCLASS.COM NETWORK PROTOCOLS GOVERN HOW DATA IS TRANSMITTED ON A

    NETWORK
  45. BLOCKCHAINLAWCLASS.COM REMEMBER THIS

  46. REMEMBER THIS

  47. OKAY LETS GO BACK IN TIME A BIT …

  48. BLOCKCHAINLAWCLASS.COM ARPANET DECEMBER 1969

  49. BLOCKCHAINLAWCLASS.COM ARPANET ARPANET, OR ADVANCED RESEARCH PROJECTS NETWORK, WAS AN

    EARLY PACKET SWITCHING NETWORK
  50. BLOCKCHAINLAWCLASS.COM ARPANET PACKET SWITCHING IS A WAY OF TRANSMITTING DATA

    ON A NETWORK BY BREAKING THE DATA INTO TWO PARTS …
  51. BLOCKCHAINLAWCLASS.COM ARPANET HEADER : THE INTERNET IS A PACKET SWITCHING

    NETWORK PAYLOAD : THE HEADER IS USED TO ROUTE THE DATA
  52. BLOCKCHAINLAWCLASS.COM ARPANET APRIL 1984

  53. BLOCKCHAINLAWCLASS.COM ARPANET - MID 1960’S INTERNET 1990’S LAN/WAN - MID

    1980’S TCP/IP - LATE 1970’S BLOCKCHAIN 2010’S IOT 2020’S (AND BEYOND) (AND BEYOND)
  54. None
  55. BLOCKCHAINLAWCLASS.COM NETWORKS CAN BE ORGANIZED IN DIFFERENT WAYS INCLUDING HOW

    THEY ARE CONTROLLED
  56. BLOCKCHAINLAWCLASS.COM MOST BLOCKCHAIN NETWORKS ARE ORGANIZED AS DECENTRALIZED NETWORKS

  57. BLOCKCHAINLAWCLASS.COM THE EXTENT OF CENTRALIZATION EXISTS ON SPECTRUM

  58. BLOCKCHAINLAWCLASS.COM NETWORKS - TYPES NOT FULL DECENTRALIZED BUT LESS THAN

    THE CENTRALIZED NETWORK
  59. BLOCKCHAINLAWCLASS.COM MOST CRYPTOCURRENCY BLOCKCHAINS ARE PEER TO PEER NETWORKS

  60. BLOCKCHAINLAWCLASS.COM PEER-TO-PEER NETWORK

  61. BLOCKCHAINLAWCLASS.COM PEER-TO-PEER NETWORKS EXAMPLES THE FIRST WAVE OF PEER-TO-PEER APPLICATIONS

    WERE FOCUSED ON FILE-SHARING NAPSTER BITTORRENT GROKSTER
  62. BLOCKCHAINLAWCLASS.COM PEER-TO-PEER NETWORKS EXAMPLES THE SECOND WAVE OF PEER-TO-PEER APPLICATIONS

    ARE FOCUSED ON ALL SORTS OF TOPICS FINANCE COMPUTING FILE STORAGE
  63. None
  64. BLOCKCHAINLAWCLASS.COM LEDGERS

  65. BLOCKCHAINLAWCLASS.COM HOW SHOULD WE ORGANIZE INFORMATION ON THESE NETWORKS?

  66. BLOCKCHAINLAWCLASS.COM ONE OPTION IS TO USE A LEDGER

  67. BLOCKCHAINLAWCLASS.COM LEDGERS MAY BE USED TO TRACK TRANSACTIONS

  68. BLOCKCHAINLAWCLASS.COM ALL PARTICIPANTS IN A LEDGER HAVE AN ACCOUNT WHERE

    THEY RECEIVE CREDITS OR DEBITS
  69. BLOCKCHAINLAWCLASS.COM AS NOTED, LEDGERS HAVE BEEN AROUND FOR MORE THAN

    5000 YEARS …
  70. BLOCKCHAINLAWCLASS.COM https://www.coindesk.com/information/what-is-a-distributed-ledger/

  71. BLOCKCHAINLAWCLASS.COM DOUBLE-ENTRY BOOKKEEPING LUCA PACIOLI - INVENTOR EVERY CREDIT HAS

    A DEBIT AND VICE VERSA REVOLUTIONIZED FINANCE/ BANKING/TRADE
  72. BLOCKCHAINLAWCLASS.COM LEDGERS - ISSUES LEDGERS CAN BE MAINTAINED BY A

    CENTRAL PARTY LEDGERS CAN BE MAINTAINED BY MULTIPLE PARTIES THAT THEN NEED TO RECONCILE THEIR LEDGERS
  73. BLOCKCHAINLAWCLASS.COM LEDGERS - AN EXAMPLE FROM BANKING

  74. BLOCKCHAINLAWCLASS.COM LEDGERS ARE THE BASIS OF BANKING

  75. BLOCKCHAINLAWCLASS.COM LEDGERS MUST BE RECONCILED BY PARTIES TO VERIFY TRANSACTIONS

  76. BLOCKCHAINLAWCLASS.COM THIS RECONCILIATION PROCESS IS TIME CONSUMING AND COSTLY

  77. BLOCKCHAINLAWCLASS.COM FOR OUR PURPOSES, LEDGERS ARE A WAY TO TRACK

    THE FLOW OF FUNDS BETWEEN PARTIES
  78. BLOCKCHAINLAWCLASS.COM LEDGERS ALLOW PARTIES TO COME TO A CONSENSUS ON

    WHO OWNS WHAT
  79. BLOCKCHAINLAWCLASS.COM A WAY TO ORGANIZE INFORMATION MAY BE MANAGED BY

    A CENTRAL PARTY, OR EACH PARTY MAY MAINTAIN THEIR OWN LEDGER THAT IS LATER RECONCILED TO MAINTAIN CONSENSUS ON TRANSACTIONS LEDGERS - A REVIEW
  80. BLOCKCHAINLAWCLASS.COM

  81. BLOCKCHAINLAWCLASS.COM NOT ALL LEDGERS NEED BE CENTRALIZED OR RECONCILED

  82. BLOCKCHAINLAWCLASS.COM DISTRIBUTED LEDGERS ARE SHARED/ REPLICATED LEDGERS

  83. BLOCKCHAINLAWCLASS.COM DISTRIBUTED LEDGERS TYPICALLY LEVERAGE PEER-TO-PEER NETWORKS

  84. BLOCKCHAINLAWCLASS.COM THE DIFFICULTY WITH DISTRIBUTED LEDGERS IS …

  85. BLOCKCHAINLAWCLASS.COM HOW DOES INFORMATION GET ORDERED CORRECTLY ?

  86. BLOCKCHAINLAWCLASS.COM WHAT ABOUT KEEPING THINGS SECRET?

  87. None
  88. BLOCKCHAINLAWCLASS.COM CRYPTOGRAPHY

  89. BLOCKCHAINLAWCLASS.COM CRYPTOGRAPHY IS ALL ABOUT SECRETS

  90. BLOCKCHAINLAWCLASS.COM CRYPTOGRAPHY - A DEFINITION CRYPTOGRAPHY IS THE ART AND

    SCIENCE OF KEEPING INFORMATION SECURE FROM UNINTENDED AUDIENCES
  91. BLOCKCHAINLAWCLASS.COM CRYPTANALYSIS - A DEFINITION CRYPTANALYSIS IS THE ART AND

    SCIENCE OF BREAKING ENCODED DATA
  92. BLOCKCHAINLAWCLASS.COM CRYPTOGRAPHY IS (ALMOST) AS OLD AS WRITING

  93. BLOCKCHAINLAWCLASS.COM EGYPT ~2000 B.C. IN EGYPTIAN TOWN MENET KHUFU IN

    THE TOMB OF KHNUMHOTEP II IS A SET OF HIEROGLYPHIC SYMBOLS DESIGNED BY THEIR CREATOR TO OBSCURE THEIR MEANING
  94. BLOCKCHAINLAWCLASS.COM EGYPT ~2000 B.C. WHILE THE EXACT REASONS FOR THIS

    ARE UNKNOWN - THIS IS AN EARLY EXAMPLE OF A SUBSTITUTION CIPHER http://www.eng.utah.edu/~nmcdonal/Tutorials/EncryptionResearchReview.pdf
  95. BLOCKCHAINLAWCLASS.COM GREECE ~700 B.C. THE ANCIENT GREEKS USED THIS CIPHER

    AS A WAY TO COMMUNICATE AMONG MILITARY. SENDER AND RECIPIENT EACH HAD A CYLINDER OF EXACTLY THE SAME DIAMETER. THE SENDER WOULD WIND A RIBBON OF PARCHMENT PAPER AROUND THE CYLINDER AND WRITE ON IT LENGTHWISE.
  96. BLOCKCHAINLAWCLASS.COM AFTER THE RIBBON IS UNWOUND, THE WRITING COULD BE

    READ ONLY BY A PERSON WHO HAD A CYLINDER OF EXACTLY THE SAME CIRCUMFERENCE. IT IS WAS NOT OVERLY SECURE BUT DID IMPOSE SOME COST TO DECRYPTION GREECE ~700 B.C.
  97. BLOCKCHAINLAWCLASS.COM ROME ROMAN EMPIRE AT ITS HEIGHT WAS MASSIVE EMPIRE

    WITH MASSIVE COORDINATION PROBLEMS HOW DO YOU KEEP INFORMATION SAFE?
  98. BLOCKCHAINLAWCLASS.COM CAESAR’S CIPHER

  99. BLOCKCHAINLAWCLASS.COM THIS IS A SIMPLE SUBSTITUTION CIPHER WHERE LETTERS ARE

    SHIFTED BY A SET NUMBER CAESAR’S CIPHER
  100. BLOCKCHAINLAWCLASS.COM PLAINTEXT INPUT: DEFEND THE EAST WALL OF THE CASTLE

  101. BLOCKCHAINLAWCLASS.COM PLAINTEXT INPUT: DEFEND THE EAST WALL OF THE CASTLE

    CIPHER
  102. BLOCKCHAINLAWCLASS.COM PLAINTEXT INPUT: EFGFOE UIF FBTU XBMM PG UIF DBTUMF

    DEFEND THE EAST WALL OF THE CASTLE CIPHERTEXT: OUTPUT: CIPHER
  103. BLOCKCHAINLAWCLASS.COM ROT13 IS JUST A SPECIAL CASE OF THE CAESAR

    CIPHER ROT13 A CANONICAL EXAMPLE OF ‘WEAK’ ENCRYPTION ROTATE BY 13 PLACES
  104. BLOCKCHAINLAWCLASS.COM THOMAS JEFFERSON INVENTED A WHEEL CIPHER JEFFERSON DISK

  105. BLOCKCHAINLAWCLASS.COM “When Jefferson became America's minister to France (1784-1789), the

    adoption of codes [for diplomatic correspondence] was necessary. Codes were an essential part of his correspondence because European postmasters routinely opened and read all diplomatic and any suspect letters passing through their command.” https://www.monticello.org/site/research-and-collections/wheel-cipher JEFFERSON DISK It is not clear to what extent Jefferson actually used the invention.
  106. BLOCKCHAINLAWCLASS.COM THOMAS JEFFERSON INVENTED A WHEEL CIPHER (JEFFERSON DISK) THERE

    ARE 36 WHEELS AND THUS 36! WAYS TO ARRANGE (I.E. 3.72 X 1041) EACH WHEEL HAS A RANDOM ARRAY OF THE ALPHABET
  107. BLOCKCHAINLAWCLASS.COM ENCRYPT: TURN WHEEL TO DISPLAY THE PLAINTEXT INPUT THEN

    SELECT A RANDOM ROW AS THE CIPHERTEXT OUTPUT
  108. BLOCKCHAINLAWCLASS.COM ENCRYPT: TURN WHEEL TO DISPLAY THE PLAINTEXT INPUT THEN

    SELECT A RANDOM ROW AS THE CIPHERTEXT OUTPUT MESSENGER ONLY HAS THE CIPHERTEXT NOT THE DEVICE
  109. BLOCKCHAINLAWCLASS.COM ENCRYPT: TURN WHEEL TO DISPLAY THE PLAINTEXT INPUT THEN

    SELECT A RANDOM ROW AS THE CIPHERTEXT OUTPUT DECRYPT: USING AN IDENTICAL COPY OF THE JEFFERSON DISK TURN WHEEL TO THE CIPHERTEXT OUTPUT AND LOOK FOR AN INTELLIGIBLE ROW MESSENGER ONLY HAS THE CIPHERTEXT NOT THE DEVICE
  110. BLOCKCHAINLAWCLASS.COM THE DEVICE WAS DEVELOPED BY MAJOR JOSEPH MAUBORGNE IN

    1917 BASED ON A SYSTEM INVENTED BY THOMAS JEFFERSON AND ETIENNE BAZERIES THE M-94
  111. BLOCKCHAINLAWCLASS.COM M4 DESIGNED FOR USE BY THE GERMAN NAVY DURING

    WWII ENIGMA
  112. BLOCKCHAINLAWCLASS.COM ENIGMA POLISH MATHEMATICIANS BROKE THE INITIAL VERSION OF ENIGMA

    BUT THE GERMANS MADE A SET OF IMPORTANT CHANGES INCLUDING CHANGING THE CIPHER SYSTEM DAILY
  113. BLOCKCHAINLAWCLASS.COM ALAN TURING HELPED INVENT A MACHINE KNOWN AS THE

    BOMBE
  114. BLOCKCHAINLAWCLASS.COM THE BOMBE ALLOWED FOR RAPID DECRYPTION OF GERMAN SIGNALS

  115. BLOCKCHAINLAWCLASS.COM SIMON SINGH, THE CODE BOOK: THE SCIENCE OF SECRECY

    FROM ANCIENT EGYPT TO QUANTUM CRYPTOGRAPHY, DOUBLEDAY PRESS (1999) A POPULAR TREATMENT OF THE HISTORY OF CRYPTOGRAPHY
  116. None
  117. BLOCKCHAINLAWCLASS.COM FOR OUR PURPOSES, WE ARE INTERESTED IN THE MODERN

    IMPLEMENTATION OF THESE IDEAS
  118. BLOCKCHAINLAWCLASS.COM KEY CONCEPTS ENCRYPTION DECRYPTION HASHING / MERKLE TREES DIGITAL

    SIGNATURES
  119. BLOCKCHAINLAWCLASS.COM ENCRYPTION DEFINITION PROCESS BY WHICH INFORMATION IS ENCODED INTO

    A FORMAT ONLY READABLE BY SOMEONE THAT KNOWS THE ENCRYPTION ALGORITHM OR CIPHER
  120. BLOCKCHAINLAWCLASS.COM DECRYPTION DEFINITION PROCESS BY WHICH INFORMATION IS DECODED INTO

    A READABLE FORMAT
  121. BLOCKCHAINLAWCLASS.COM ENCRYPTION MAY BE SYMMETRIC OR ASYMMETRIC

  122. BLOCKCHAINLAWCLASS.COM SYMMETRIC ENCRYPTION - DEFINITION BOTH PARTIES TO A MESSAGE,

    SENDER AND RECIPIENT, USE THE SAME KEY FOR ENCRYPTING AND DECRYPTING THE MESSAGE INFORMATION IS ON A TWO WAY STREET USER MUST KEEP THE KEY SECRET
  123. BLOCKCHAINLAWCLASS.COM ASYMMETRIC ENCRYPTION - DEFINITION USES TWO KEYS FOR HANDLING

    OF INFORMATION INFORMATION IS ON A ONE WAY STREET ONE KEY ENCRYPTS AND OTHER DECRYPTS TYPICALLY KNOWN AS PUBLIC-KEY CRYPTOGRAPHY
  124. None
  125. BLOCKCHAINLAWCLASS.COM PUBLIC-KEY CRYPTOGRAPHY

  126. BLOCKCHAINLAWCLASS.COM HOW ARE THE KEYS GENERATED? LARGE “RANDOM” NUMBER IS

    USED AS A SEED
 THE LARGE RANDOM NUMBER MUST BE HARD TO GUESS TYPICALLY THIS IS A LARGE PRIME NUMBER
  127. BLOCKCHAINLAWCLASS.COM HOW ARE THE KEYS GENERATED?

  128. BLOCKCHAINLAWCLASS.COM

  129. BLOCKCHAINLAWCLASS.COM MOST CRYPTOCURRENCY BLOCKCHAINS USE PUBLIC-KEY CRYPTOGRAPHY

  130. BLOCKCHAINLAWCLASS.COM THEY ALSO LEVERAGE HASHING AND DIGITAL SIGNATURES

  131. BLOCKCHAINLAWCLASS.COM HASHING AND DIGITAL SIGNATURES ARE USED TO SECURE INFORMATION

    TRANSMITTED ON NETWORKS
  132. None
  133. BLOCKCHAINLAWCLASS.COM HASHING - DEFINITION A FUNCTION THAT IS USED TO

    MAP DATA OF ANY SIZE TO A FIXED SIZE
  134. BLOCKCHAINLAWCLASS.COM TAKE A GIVEN INPUT OF AN ARBITRARY LENGTH

  135. BLOCKCHAINLAWCLASS.COM GET THE SAME HASH FUNCTION BACK AS OUTPUT

  136. BLOCKCHAINLAWCLASS.COM HASHING - AN EXAMPLE This old man, he played

    three, he played knick- knack on his knee INPUT TEXT E5B2621834F9F271503F12 AB984EF2312EC9CBBF257 AE27DAD7E1BE9F93104F9 This old man, he played three, he played knick- knack on his Knee A4AD6A051622F3E1BEBD90 F434A728DB36A62BB8A62D 59782DA2CB9F575FFCB2 SHA-256 SHA-256 HASH FUNCTION HASH VALUE
  137. BLOCKCHAINLAWCLASS.COM ANY CHANGE GENERATES A DIFFERENT HASH VALUE

  138. BLOCKCHAINLAWCLASS.COM https://passwordsgenerator.net/sha256-hash-generator/ FUN WITH HASHING

  139. BLOCKCHAINLAWCLASS.COM https://cran.r-project.org/web/ packages/digest/index.html SOME HASH RELATED PACKAGES https://docs.python.org/3/library/ hashlib.html#module-hashlib

  140. BLOCKCHAINLAWCLASS.COM FIVE IDEAL PROPERTIES FOR A HASHING ALGORITHM 5. UNLIKELY

    TWO MESSAGES HAVE SAME HASH 1. SAME MESSAGE RESULTS IN THE SAME HASH 2. QUICK TO COMPUTE THE HASH VALUE 3. ONE WAY STREET 4. SMALL CHANGES TO MESSAGE GENERATE DIFFERENT HASHES
  141. BLOCKCHAINLAWCLASS.COM HASHING HELPS ENSURE AGAINST TAMPERING WITH INFORMATION

  142. None
  143. BLOCKCHAINLAWCLASS.COM DIGITAL SIGNATURE A MATHEMATICAL WAY TO AUTHENTICATE AND VERIFY

    THE INTEGRITY OF A RECEIVED MESSAGE
  144. BLOCKCHAINLAWCLASS.COM DIGITAL SIGNATURE HASH ALGORITHMS HASH VALUE SENDER PRIVATE KEY

    SIGNED MESSAGE SENDER RECEIVER SIGNED MESSAGE SENDER PUBLIC KEY HASH VALUE
  145. BLOCKCHAINLAWCLASS.COM DIGITAL SIGNATURE DIGITAL SIGNATURES ALLOWS A USER TO PROVE

    WHO SENT A MESSAGE AND THAT THERE HAS BEEN NO MESSAGE TAMPERING
  146. None
  147. BLOCKCHAINLAWCLASS.COM MERKLE TREE MERKLE TREE OR HASH TREE IS NAMED

    AFTER RALPH MERKLE WHO PATENTED THE IDEA IN 1979 https://patents.google.com/patent/US4309569A/en
  148. BLOCKCHAINLAWCLASS.COM MERKLE TREE “A MERKLE TREE IS A HASH BASED

    DATA STRUCTURE … IN WHICH EACH LEAF NODE IS A HASH OF A BLOCK OF DATA, AND EACH NON-LEAF NODE IS A HASH OF ITS CHILDREN. MERKLE TREES ARE USED IN DISTRIBUTED SYSTEMS FOR EFFICIENT DATA VERIFICATION. THEY ARE EFFICIENT BECAUSE THE USES HASHES INSTEAD OF FULL FILES.” VIA BRILLIANT.ORG
  149. BLOCKCHAINLAWCLASS.COM MERKLE TREE WHAT IS CRITICAL ABOUT A THE TREE

    BASED STRUCTURE IS THAT NODES FURTHER UP IN THE TREE ARE THE HASHES OF THEIR RESPECTIVE CHILDREN — ANY TAMPERING UPSTREAM CHANGES DOWNSTREAM …
  150. BLOCKCHAINLAWCLASS.COM MERKLE TREE FOR EXAMPLE — HASH 0 IS THE

    RESULT OF HASHING THE CONCATENATION OF HASH 0-0 AND HASH 0-1. THAT IS, HASH 0 = HASH( HASH 0-0 + HASH 0-1) WHERE + DENOTES CONCATENATION
  151. None
  152. BLOCKCHAINLAWCLASS.COM CRYPTOGRAPHY A REVIEW 1. USED TO PROTECT SECRETS 2.

    PUBLIC-KEY CRYPTOGRAPHY USES KEY PAIRS GENERATED BY USE OF A LARGE RANDOM NUMBER 3. HASHING SECURES THE INTEGRITY OF INFORMATION SENT ON A NETWORK 4. DIGITAL SIGNATURES AUTHENTICATE WHO SENT A MESSAGE AND VALIDATE THE INTEGRITY OF THE SENT MESSAGE
  153. BLOCKCHAINLAWCLASS.COM BUILDING BLOCKS PUT TOGETHER NETWORKS PEER-TO-PEER NETWORKS ALLOW PARTICIPANTS

    TO DIRECTLY CONNECT WITH EACH OTHER AND PERFORM TRANSACTIONS LEDGERS DISTRIBUTED LEDGERS ARE MAINTAINED BY EVERYONE ON THE PEER-TO-PEER NETWORK CRYPTOGRAPHY PUBLIC-KEY CRYPTOGRAPHY PROVIDES THE ADDRESSES AND AUTHENTICATION OF USERS IN THE PEER-TO-PEER NETWORK INFORMATION IS PROTECTED THROUGH THE USE OF HASHES AND DIGITAL SIGNATURES
  154. None
  155. BLOCKCHAINLAWCLASS.COM HOW DOES IT ALL FIT TOGETHER?

  156. BLOCKCHAINLAWCLASS.COM WHAT ABOUT THE ECONOMIC INCENTIVES?

  157. BLOCKCHAINLAWCLASS.COM IN THE LATER MODULES, WE WILL DISCUSS CROWDS AND

    CONSENSUS
  158. BLOCKCHAINLAWCLASS.COM WE WILL ALSO DISCUSS ECONOMIC INCENTIVES ASSOCIATED WITH PEER

    TO PEER PARTICIPATION (I.E. CURRENCY, REPUTATION, ETC.)
  159. BLOCKCHAINLAWCLASS.COM FOR MORE MODULES VISIT

  160. DANIEL MARTIN KATZ E D U | I L L

    I N O I S T E C H + S TA N F O R D C O D E X B LO G | C O M P U TAT I O N A L L E GA L S T U D I E S . C O M PAG E | DA N I E L M A R T I N K AT Z . C O M C O R P | L E X P R E D I C T. C O M NELSON ROSARIO B LO G | L AWO F C RY P TO C U R R E N C Y. C O M PAG E | N E L S O N M RO S A R I O . C O M F I R M | M A R S H A L L I P. C O M BLOCKCHAINLAWCLASS.COM L A B | T H E L AW L A B . C O M E D U | I L L I N O I S T E C H - C H I C AG O K E N T L AW
  161. @ computational professor daniel martin katz danielmartinkatz.com BLOCKCHAIN, CRYPTOCURRENCY AND

    LAW professor nelson rosario THE BUILDING BLOCKS OF THE BLOCKCHAIN — NETWORKS + LEDGERS + CRYPTOGRAPHY nelsonmrosario.com @ nelsonmrosario BLOCKCHAINLAWCLASS.COM