Blockchain

1.0
 History of blockchain 1.0
Blockchain 1.0 is often associated with the creation of Bitcoin in
2008 by an anonymous person or group using the pseudonym
Satoshi Nakamoto. Bitcoin introduced the concept of blockchain
technology as a decentralized, immutable ledger to record
transactions of the cryptocurrency. The first block of the Bitcoin
blockchain, known as the "genesis block," was mined on January
3, 2009, marking the beginning of blockchain 1.0. Bitcoin's
blockchain laid the foundation for subsequent developments in
blockchain technology and inspired the creation of numerous
other cryptocurrencies and blockchain-based applications.

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Blockchain 1.0
Blockchain 1.0, often associated with Bitcoin,
primarily aimed to create a decentralized digital
currency system, allowing peer-to-peer transactions
without the need for intermediaries like banks. It
focused on the use of cryptographic techniques to
secure and verify transactions on a distributed
ledger.

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 Blockchain 1.0 primarily features

Decentralization Consensus
Security
Mechanisms
Transactions are recorded Cryptographic
on a distributed ledger, Blockchain 1.0
typically uses proof- techniques ensure the
eliminating the need for a security of transactions,
central authority. of-work consensus
mechanisms to making it difficult for
validate and add unauthorized parties to
transactions to the tamper with data.
Immutability ledger.
Transparency
Once data is recorded
on the blockchain, it All transactions are visible
cannot be altered or to all participants,
deleted, ensuring the promoting transparency
integrity of the ledger. and trust.
 Cryptographic Hash Function:
Used to secure the integrity of data within blocks and link blocks
together through hashes.

Distributed Ledger:
Component A decentralized database that records all transactions across a
network of computers (nodes).

s of Consensus Mechanism:
Used to achieve agreement among nodes on the validity of
transactions and the order in which they are added to the

blockchain blockchain. Bitcoin's blockchain 1.0 primarily uses proof-of-work

(PoW) as its consensus mechanism.
Transactions:

1.0
Records of data exchanges between participants in the network,
stored in blocks and added to the blockchain.

Wallets:
Software or hardware applications used to store,
manage, and interact with cryptocurrencies and
blockchain assets
Advantage Disadvantage
I. Scalability: Traditional blockchain 1.0 systems like
I. Decentralization: Eliminates the need for
Bitcoin have limitations in transaction throughput,
intermediaries, reducing costs and increasing
leading to scalability issues during periods of high
efficiency in transactions.
demand.
II. Immutability: Once data is recorded on the
II. Energy Consumption: Proof-of-work consensus
blockchain, it cannot be altered or deleted, ensuring
mechanisms, as used in blockchain 1.0, require
the integrity and security of transactions.
significant computational power and energy
III. Transparency: All transactions are visible to all
consumption, raising concerns about environmental
participants, promoting trust and accountability.
impact.
IV. Security: Cryptographic techniques ensure the
III. Transaction Fees: Depending on the blockchain 1.0
security of transactions, making it difficult for
platform, transaction fees can vary and may be
unauthorized parties to tamper with data.
relatively high during peak usage times.
V. Accessibility: Enables peer-to-peer transactions
IV. Regulatory Uncertainty: The decentralized and
across geographical boundaries, without the need for
pseudonymous nature of blockchain 1.0 can pose
traditional financial institutions.
challenges for regulatory compliance and oversight.
V. Data Privacy: While transactions are transparent, the
underlying data stored on the blockchain may not
always adhere to privacy regulations, raising
concerns about data protection and confidentiality.

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 Comparison between blockchain 1.0 and
3.0
Blockchain 1.0: Blockchain 3.0:

• Primarily focused on decentralized • Shifted towards broader applications

Focus
currency and peer-to-peer transactions, beyond currency, emphasizing
exemplified by Bitcoin. scalability, interoperability, and smart
contract functionality.
• Provides pseudonymous transactions Privacy • Enhances privacy and security features
with varying degrees of privacy features. and through techniques such as zero-
Securit knowledge proofs, ring signatures, and
y
secure multi-party computation.
• High energy consumption associated • Adopts energy-efficient consensus
Environment
with proof-of-work consensus al Impact mechanisms (e.g., proof-of-stake) and
mechanisms. explores sustainable blockchain
solutions to reduce environmental
impact.

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Thank you
Mirjam Nilsson
[email protected]
www.contoso.com