Trying to understand blockchain by making one!

Introduction

Bitcoin and cryptocurrencies made a lot of noise lately. I have been rather disappointed by the turn the cryptocurrencies took, from an amazing concept to what seems just another way to make quick money ( or not... ).

But I became very interested by the technologies enabling cryptocurrencies, and obviously by the concept of a blockchain. The concept is fascinating, and not limited to Bitcoin and friends. We could imagine many applications for such a technology. So, in a proper developer manner, I decided to code one blockchain, or what I think is a blockchain, to understand better what it is.

A simple project

So, what do we need to create a very simple blockchain?

• A block

A block is what the blockchain is made of. In our case, a block will be composed of a date, an index, some data ( a message in our case ), and the hash of the previous block.

• Cryptography

To keep informations secure, we need to encrypt our data. For our little project, we will use the js-sha256 package. This process will create a string of 64 characters. Ultimately, our blockchain will be a series of hashes, each composed of 64 characters. As I said earlier, we use the hash of the previous block to encrypt a new block ( that is why we call it a chain ).

• Difficulty and nonce

We don't just create one hash per block and that's it. A hash must be valid. In our case, a hash will be valid if the first four characters of our hash are 0. If our hash starts with '0000......', it is considered valid. This is called the difficulty. The higher the difficulty, the longer it takes to get a valid hash.

But, if the hash is not valid the first time, something must change in the data we use right? If we use the same data over and over, we will get the same hash over and over and our hash will never be valid. You are right, we use something called nonce in our hash. It is simply a number that we increment each time the hash is not valid. We get our data (date, message, previous hash, index) and a nonce of 1. If the hash we get with these is not valid, we try with a nonce of 2. And we increment the nonce until we get a valid hash.

• Genesis block

Their must be a first block in our chain. It is called the genesis block. Of course, this block can't use the hash of the previous block because it doesn't exist. We will just give it some arbitrary data to create its hash.

And that is pretty much what we need for our blockchain.

The methods

We will need a few methods to make a functional blockchain:

• initialize our blockchain => creates the genesis block
• hash our blocks => a function responsible for creating a valid hash
• check the validity of a hash => does our hash starts with 'OOOO' ?
• get the last hash => we need the previous hash to create a new block
• add a new block => We need to do that at one point, if we want a chain

THE COOOOODE !!

Let's get coding now.

For this little project, I will create two files, one called index.js and another called blockchain.js. The second one will hold our little module to create a blockchain. It's straightforward, let's take a look at it:

const sha256 = require('js-sha256').sha256

const blockchain = (function(){
  const blocks = []

  const initBlockchain = () => {
    const data = 'Hello World!'
    const timestamp = new Date()
    const previousHash = 0
    const index = 0
    hashBlock(data, timestamp, previousHash, index)
  }

  const hashBlock = (data, timestamp, prevHash, index) => {
    let hash = '', nonce = 0

    while( !isHashValid(hash) ){
      let input = `${data}${timestamp}${prevHash}${index}${nonce}`
      hash = sha256(input)
      nonce += 1
    }
    console.log(nonce)
    blocks.push(hash)
  }

  const getLastHash = blocks => blocks.slice(-1)[0]

  const isHashValid = hash => hash.startsWith('0000') // Difficulty

  const addNewBlock = data => {
    const index = blocks.length
    const previousHash = getLastHash(blocks)
    hashBlock(data, new Date(), previousHash, index)
  }

  const getAllBlocks = () => blocks

  return {
    initBlockchain,
    getLastHash,
    blocks,
    getAllBlocks,
    addNewBlock
  }
})()

module.exports = blockchain

So, in this module, I have a few methods. At the top, I import the module that will handle the cryptography part. I have an empty array that will hold my blockchain's blocks, called blocks.

initBlockchain: This method starts the blockchain by creating the first block, the genesis block. I give it a timestamp, a message, the block's index in the blockchain ( 0 ) and a arbitrary previous hash because there are no previous blocks in the chain yet. With all these informations, I can now create the hash for the genesis block.

hashBlock: This method takes all the block's data and creates a hash. As you can see, the first time we run the function for a specific block, the nonce is set to 0. We encrypt our block and check if the hash is valid with isHashValid. In our case, a hash is valid if the four first characters are 0. This is called the difficulty. This is the problem we have to solve to make sure the block can be part of the blockchain. Once the hash is valid, we add it to our blocks array.

addNewBlock: This method is responsible for creating a new block. We only need to give it the message as an argument, because all the other arguments ( index, previousHash, and timestamp) can be found in the blockchain. The method calls hashBlock with the data to create and validate the new block.

getLastHash: The method I call to get the previous hash. We always need the previous hash to create a new block.

getAllBlocks: Just returns all the blocks currently in the blockchain

Great, so let's move to index.js to use our new blockchain!

const blockchain = require('./blockchain')

blockchain.initBlockchain()
blockchain.addNewBlock('First new block')
blockchain.addNewBlock('I love blockchains')
blockchain.addNewBlock('Make me a new hash!!')

console.log(blockchain.getAllBlocks())

We initialize our blockchain, then we create three new blocks. When I run this, I get the following chain in response:

Initializing the blockchain
139355
30720
68789
51486
[ '0000d87875f12e8c00d60cdfc8c21c4867eb1e732d3bb0e4d60bd0febcfafbaf',
  '0000331d80f4e83461bad846e082baa08c5e739edfa19a4880c1dcbe4eed1984',
  '00000dcab247410050e357158edc20555cc0110429023fdadb1d8cda3e06da5e',
  '0000a16968811cf75c33d877e99f460d396c46b5485f669c8e55b193b862106d' ]

The array represent the four blocks. As you can see, every single one of them starts with four zeros, so every single hash is valid. If one of those hashes didn't start with four zeros, I would know right away the hash was invalid, therefore, the data in the corresponding block should probably not be trusted.

There are four numbers here: 139355, 30720, 68789, 51486. These are the nonce for each block. I printed them out to see how many times the function hashBlock ran to come to a valid hash.

The first block, the genesis block, ran 139355 times before having a valid hash! The second, 30720 times. The third 68789 times and the fourth 51486 times.

Conclusion

This is a very simple example of a blockchain. I'm pretty sure I missed a few things here. I also kept things pretty simple because hey, I'm learning! This little project made me understand a few things:

• If one person decides to modify a previous block, she would have to change every single block after that one. Each block inherits from its parent ( previous hash ), so trying to cheat a blockchain seems complicated.

• But if a majority of the blockchain's users decide to cheat, they could modify a previous block and all agree to change the rest of the blockchain accordingly. A blockchain seems to work only if the majority decides to follow the rules. Or you could end up with two different blockchains, one where the users decided to stick with the original data, and the other where the users decided to use the modified blockchain.

• I've heard about the Bitcoin enormous use of power where it came to mining. Mining is the concept of solving the difficulty problem when you encrypt the data. You get the transaction and you try to find a valid hash for that block. As a reward for your effort, you get some bitcoin. I can only imagine the amount of power you would use when the blockchain becomes huge.

Well, that's about what I got from that. It made things a lot clearer for me. Feel free to correct me if i got things wrong!

Comments

[baolongt]

Thanks a lot

[eva]

That is absolutely brilliant, Damien. Nothing like seeing it with your own eyes in order to understand it. Many thanks :-)

To help out anyone who is not at all familiar with node (hello, anyone there? ;-) ) here's a very simple way to run this:

1. Create a folder.
2. In it, create both files index.js and blockchain.js as instructed in the article. Copy & paste respective code.
3. Get a command prompt or a terminal to the folder that contains both files.
4. Run npm init -y (this will create the package.json file)
5. Run npm install js-sha256 (this will install the required module and update package.json)
6. Just run the project with node index.js

Hope it helps.

[davidkiama]

Hey would you please recommend a good online course on blockchain

[vishnuvizz]

I have a doubt!! Bitcoin!!!!
If people from multiple mining pool trying to find nounce for certain block, then how are they going to agree to validate the same transaction in that block? if they didn't agree to mine with same transactions, then how is blockchain going to verify that they did valid mining(I meant not cheating). There is still a possibility that they can cheat right? If other mining pool people took diff set of transaction to mine for a block, then obviously they ll get diff hash and so they can't compare with them with actual hash. and If only one pool would get incentive (12.5BTC) then how after one mining a block, some other pool is going to waste its compute power in verifying the transaction. Even if it did so, how is it going to resist to change as change is already done in the blockchain.

Someone, please help me out...

[Sunita Singhal]

Very much impressed with the article.
Does each block contain one transaction in case of bitcoin?
How the bitcoin is generated? Who will generate?

[eternalprofits]

Thank you for the article! very helpful.
Here is a block application building hackathon coming on this weekend July 14, 15. Let me know if anyone else is joining: bit.ly/2L2olS9

[ebraheemijaz]

very Interesting and best for beginners

[Tanya Daskova]

Did we get an answer to how we retrieve the original data? How to see the messages in each block? Other than that, really good article! Well done!

[Ezzat]

thank you for the post it really cleared many concepts i was struggling to understand.

here is the implementation in python

first file

blockchainLib.py

import hashlib
import time

blocks = []


def encrypt_string(hash_string):
    sha_signature = \
        hashlib.sha256(hash_string.encode()).hexdigest()
    return sha_signature


def isValidhash(hash):
    if hash.startswith("0000"):
        return True
    return False


def hashBlock(data, timestamp, previoushash, index):
    _hash = ""
    nonce = 0
    while not isValidhash(_hash):
        _input = data + str(timestamp) + str(previoushash) + str(index) + str(nonce)
        _hash = encrypt_string(_input)
        nonce += 1
        print(nonce)
    blocks.append(_hash)


def getLastHash():
    return blocks[len(blocks) - 1]


def addNewBlock(mmessage):
    _index = len(blocks)
    timestamp = time.time()
    previousHash = getLastHash()
    hashBlock(mmessage, timestamp, previousHash, _index)


def getAllBlocks():
    for i in range(0, len(blocks)):
        print(blocks[i])


def initBlock():
    data = "hello world"
    timestamp = time.time()
    previoushash = 0
    index = 0
    hashBlock(data, timestamp, previoushash, index)

the second file

main.py

#!/bin/python3


import blockchainLib as bl

if __name__ == "__main__":

    bl.initBlock()
    bl.addNewBlock("hello world")
    bl.addNewBlock("hello world 2")
    bl.getAllBlocks()

[Maciej Przerwa]

I don't get one thing. How to retrieve information from this Blockchain (the data Strings?)