Blockchain, Cryptocurrencies and Web Trust
By R. Butz and B. Krumnow
Starting in the early 1990s, cryptographers tried to develop ways in order to realise the concept of “money” in electronic form. David Chaum developed one of the first electronic currencies called ecash, which aimed to keep its users anonymous [1, 2]. The anonymity was achieved with blind signatures. These allowed users to obtain an untraceable digital currency from a bank and spend it. In later versions, it was even possible to allow offline transactions without double-spending. However, with Chaum being too greedy ecash was forgotten soon. After other brief experiments with digital money, pure forwarding services such as PayPal prevailed over electronic currencies.
Over the last years, the interest and investments in cryptocurrencies has been rapidly growing. Bitcoin alone experienced a massive price increase from $1,000 USD a coin to temporarily over $19,000 USD in 2017 . This can be seen as sign for a wider acceptance and also as a big success of this technology. However, the new interest in cryptocurrency is not only financially motivated. The Blockchain, the underlying technology of cryptocurrencies as Bitcoin, renewed the idea to decentralise digital systems. In fact, the original intension of Bitcoin was to solve a trust-based issue within the online merchandise domain . Traditionally, trading parties had to rely on middlemen, such as banks and payment service providers, in order to perform transactions. This involvement makes transactions reversible and led middlemen to collect unnecessary information about traders. By moving transactions into a blockchain cryptographic proof about transactions are always provided. This creates a foundation for systems, whereby there is no need for central parties or middlemen to authenticate transactions.
Applying the concept of the Blockchain to other areas, makes a transition towards a more centralised Web within the next few years a more feasible proposition.
The goal to design a workshop to teach the concept of blockchains contains some obstacles. The basic concepts are complex materials of computer science and their applications within Blockchain, concepts such as peer-to-peer-systems and cryptography must first be established. Furthermore, the Web sicence programme at TH Köln defines a 3 hours length for online workshops. Students can quickly be overwhelmed with these concepts within a single workshop. Luckily, there are plenty of materials available to students, such as books, MOODS and video blogs. All of which aid understanding these concepts outside the classroom.
We kept these things in mind, when designing our workshop. It addresses not only technical fundamentals but also the application of blockchain in practice. The current design is sperated into 3 parts. The first part of the course makes participants familiar with basic concepts and can be done at home. It encompasses an exercise, which consists of a fun-based hacking challenge with the aim build on basic hash functions. Followed by some basic reading materials and questions about asymmetric cryptography and cryptographic hash functions. Within the classroom environment students clarify questions together with the lecturers and dive into the concept of Bitcoin and blockchains. In additon, students learn which opportunities the technologies hold and what it means to web trust then they work on real life problems and attempt to address them with bitcoin or ethereum. All the results are presented in a poster session at the final on-site session, which rounds up the discussions from the workshop.
- Untraceable Electronic Cash – David Chaum and Amos Fiat and Moni Naor, Advances in Cryptology – CRYPTO ’88, 8th Annual International Cryptology, Conference, Santa Barbara, California, USA, August 21-25, 1988, Proceedings, 319-327, 1988
- Chaum, David. “Blind signatures for untraceable payments.” In Advances in cryptology, pp. 199-203. Springer, Boston, MA, 1983.
- Nakamoto, Satoshi. “Bitcoin: A peer-to-peer electronic cash system.” (2008).
- Bitcoin USD price – Coindesk, https://www.coindesk.com/price/, last seen 7th May 2018
May 8, 2018 | | Benjamin Krumnow