3.2 Block - Video Tutorials & Practice Problems

So now that we have described what a cryptographic hash is and we talked about SHA-256. We're gonna talk about how this all ties into a block on the Bitcoin blockchain. To do that, we're gonna focus on the specific second tab on the navigation that says block. And what you see here is a block in the Bitcoin blockchain. Now this is a very simplified version of the Bitcoin blockchain and it's not exactly everything you're gonna see on the Bitcoin blockchain but it gives you the key elements that all tie together so you see exactly how this builds. We've talked about the hash, now we're gonna use these hashes as part of a block. So for this block, I wanna point out the different elements and fields you see here. The first thing you see is that you see a block number. For the purposes of this demo, this is blocked number one. And we talked about the fact that the blockchain actually orders blocks chronologically. So if you're building blocks chronologically this would have been block number one. Now this block number one has a field for data. Now notice that there's a cryptographic hash for this block and that cryptographic hash begins with four leading zeros. This is gonna be very important. And the reason why I say that is for the purposes of this demo, and as you'll learn as we go through this course, this specific type of cryptographic hash and the fact that we have this four leading zeros on the cryptographic hash is what determines that this block is valid. Notice also that this block is actually a green in color. And I'll show you exactly how this all plays together. What we have here is that block number one has a field called data and then you have this cryptographic hash. Let's put some data in here and let's just put, let's say transaction one. Notice that the color of the block changed to red. And the reason it changed is because the cryptographic hash changed and no longer has four leading zeros and now begins with F-E-6-F. So you see, as you change the contents of this block, the cryptographic hash changes. This ties in perfectly with what we spoken of in the previous lesson, where we talked about the hash. Because the hash is a digital fingerprint of a certain amount of data. And in this case, we changed the data. Notice, if I take this out, we have a perfectly valid cryptographic hash with four leading zeros. But again, if I type in that TX one boom, we break that cryptographic hash. Now here's what's important about this, I need to make sure for this block to be valid, that it has four leading zeros. And the only way that I can do that is either changing this field in the data or changing the block number. But I also have a field called nonce which I haven't talked to you about. Nonce stands for number used once. And this is a very important piece into making this a valid block. Because this is what the miners use to be able to make a valid cryptographic hash to make a block valid and add it to the Bitcoin blockchain. So, as I explained to you, what would make this a valid block would be if it had four leading zeros. That's a simplified way of looking at it. In fact, if you wanna be specific, what you have is that this cryptographic hash has to be below a certain target level. And that's determined by the Bitcoin Network. The Bitcoin Network determines how low this cryptographic hash needs to be. So if I have four leading zeros, I have a certain number because this cryptographic hash is actually a fixed size alphanumeric string, but it's a numeric value. This is actually a value and this is a number and that number needs to be below a certain target. So, the Bitcoin Network determines what that target is and the miners need to create a cryptographic hash that's below that target. For the purposes of this demo, it needs to have four leading zeros and be a certain number. Now, in the Bitcoin Network, as you will see later in the course, these cryptographic hashes are far lower. There's many many more leading zeros in the beginning, which means that it's a much lower value. But to keep this controllable because this computer is not very powerful, we're gonna use just four leading zeros. Because the way that you do this is by actually changing this nonce. And you would do that, if I put a one, you notice how this cryptographic hash changes? Well, let me try a number two. That changes again. Well, let's try a number three and I am randomly trying one, six, seven, eight. I'm just trying again and again to see what nonce will actually get me a cryptographic hash that will be below the certain target that I need. And as you can see, I'm trying just here, I'm trying let's try 400 and I can just keep trying 401, 402. It's a very, very time-consuming process just going through this. And this is literally what the miners are doing but the miners are using powerful mining computers that actually do this automated. So let's do that right now. As you'll notice that we have a button that says Mine. Now let's see what nonce we would need to get to bring down this cryptographic hash below the certain target level that we need. That is, get those four leading zeros. Let's just let the computer do this. And we're waiting right now and letting the computer just randomly try again and again and again, until it reached the number 61, which gave us a cryptographic hash that had four leading zeros. That is it's below the specific targets level we had. When these miners are actually doing these calculations on the real Bitcoin Network, they're actually doing these attempts, billions and billions of times a second, trying to find nonce that will enable them to get a cryptographic hash below the target level that the Bitcoin Network requires. So key things I want you to take out of this specific part of this demo is that in a block you have various elements. You have the block number, you have the data for this. In fact, let's say that we have more transactions. Let's say transaction two, let's transaction three and notice how the cryptographic hash has changed for all these. And we need this hash to be a certain specific value. And the only way you can do that is by changing this nonce. We said that doing it manually just is a very labor, time consuming process but you can also let technology do it for you. And what we find is that, that in this case the nonce was 5,835. Notice how this specific nonce was far lower than the previous one. So it's irrelevant how much data you're putting in here. You never know what that nonce will be. The only way that you can actually find out what the nonce require is by randomly trying again and again and again to figure that out. And that is how you're gonna be able to get a valid cryptographic hash to make this block valid. Let's move on to build this block into a blockchain.