Homework on Consensus - Questions

Blockchain and Bitcoin 101
#1791

  1. The blockchain does not allow one version of a transaction’s truth to be added to any block within any node. All computers of the blockchain network must achieve agreement for the transaction to be introduced in the network.

  2. A centralized database has one entity that determines the truth of a transaction. Consensus in a decentralized database provides incentives for a network of entities to achieve an agreement with a transaction’s acceptance or denial into the blockchain.

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#1792

  1. The truth is determined by the blockchains agreeing what is being told is true. The truth is achieved through incentives. The blockchain nodes reach a consensus to what is true or what is false.

  2. The truth in a central database is determined by people who can alter the information with no group consensus to challenge them that it is not true, allowing them to put any version of information into circulation.

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#1793

What does it mean when we say that in blockchain, consensus determine the truth?
Consensus determine the truth means that multiple blockchain nodes verified individually a transaction a same to the conclusion that it is wright. If the individually verifications off multiple nodes are the same there is a consensus and it is the truth.

How is this different from how truth is determined in a central database?
A centrale database is controlled by a single entity. If this entity makes a mistake (willingly or unwillingly) the outcome is not verified by other parties …so not full trusted.

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#1794

1.The blockchain must agree as a group that everything is where it came from.
2. A central database can be edited.

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#1795

Homework on Consensus - Questions

  1. What does it mean when we say that in blockchain, consensus determine the truth?
    Consensus determining the truth means we have a network of different computers that is able to see,update and verify the source of any new information, either data or transaction depending on the sector where trust is needed to be in check but without the need to doubt if it is truth or not which is an important factor that can be altered by an untrustworthy parties to hide there deficiency.Therefore with consensus different parties were able to confirm their role using a mathematical function in the network rather than relying on a single source.Every individual network or nodes have an incentives to benefit from outlining their genuine role especially in a supply chain and the same goes with a transaction and if the truth is hidden or unverifiable by the mathematical function then the incentives will not be attained.

  2. How is this different from how truth is determined in a central database?
    The central database has proven to be faltered in so many case because of issue of trust. The transparency of any data can be hidden as there is no individual communication between every single entity that leads to the collection of data to see clearly when and why a change is occurring in the supplied data.

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#1796

  1. Consensus is the agreement of different networks deciding if a certain information is true and can be added to the ledger. It makes blockchain trustless towards everything that is being entered unless it has been proven true.

  2. A central database is own by a single individual which has the power to decide if a certain information is true or false.

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#1797

(1) With respect to blockchain, consensus determines the truth based on the respective consensus protocols of each cryptocurrency/blockchain. Usually all nodes (or a majority) agree about the information in a block and agree to publish the information. There is no one party involved that has a veto power or can determine the data in a block. The different nodes in the consensus algorithm are kept honest with game theory and financial incentives at risk. Dishonest members will lose money. Honest members will gain money.

(2) This is different from how truth is determined in a central database because there is no counterpart to contradict or verify that the information in the centralized database is in fact true. With a central database, the authority that inputs the data is the one who determines what is true, with no accountability or transparency that you would have with a network of computers verifying that all data entered is true. There is no financial incentive to keep the truth in the centralized database.

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#1798
  1. What does it mean when we say that in blockchain, consensus determine the truth?
    When a blockchain reaches consensus it means that a network of participants agree that something is true this can be many things like a transactions and data.Consensus allows the ledger to be double checked to ensure it is in fact true whether something happened or did not happen.

How is this different from how truth is determined in a central database?
Central databases do not have multiple participants agreeing on what is true and not true rather they rely on a authority to state if something or not. Central databases rely heavily on trust of the authority to secure and store the data.

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#1799

Very good answers. I like how you pointed out the possibility of multiple types of consensus in blockchains. :smiley:

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#1800

I really like talking about consensus when it comes to Bitcoin because it is an example of my ideology actually working in the real world. I’m an Anarchist and that used to be very hard to admit in public because Anarchy is so misconstrued. The semantics have been lost and most people hear the word and think it means chaos when in fact Anarchy has nothing to do with chaos. When you break the word down in Greek “An” means without and “Archon” means ruler, Anarchy literally means without rulers. It does not mean without rules.

Ivan first asks, what does it mean when we say that in blockchain, consensus determines the truth? Consensus means the rules of the network or the rules of how the game is played. Bitcoin is just a massive game with lots of players who are incentivized by the other players to play by the rules or else lose the game. So when we say in blockchain, consensus determines truth that means that in order for your transaction to be true and confirmed on the blockchain you must abide by the consensus of the network. Otherwise, your transaction will just be rejected like it never existed as a false and forever forgotten transaction.

Second Ivan asks, how what above is different from how truth is determined in a central database? How a central database determines truth is much like the game we are normally used to playing in the world, a ruler determines the rules and enforces those rules through force. Either you play by the rules of the person or persons who created the database or else they will force you out of the database. The ruler or creator of the database determines truth in this case.

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#1801

Hi, I thought I understood but then comes up the incentive part which I don’t get. Can you explain more what you mean by "The truth is achieved through incentives?

#1802
  1. All parties (nodes) have agreed e.g. to the transaction and get only incentive if playing by the rules.
  2. Truth in central database is not verified by other independent parties like in the network.
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#1803

The incentive structure is just a part of the Bitcoin Network consensuses , or rules of the game, and is vast and complex. Though there are many incentives in Bitcoin they are mostly based on one human emotion you can count on, greed. We all want to make more more money, right? Lol! One example of an incentive is when you want to spend some of your Bitcoin. In order for you to broadcast the transaction you are going to have to pay a fee to the miners. You are incentivizing the miners to broadcast your transaction. Though the incentive structure is part of the network consensus it is not the entire consensus. There are other rules to the network besides incentives. One example is like block size, though arguably block size could possibly be an incentive, there are rules to the size of each block that is mined. If the rules are not followed the network will reject the block. This is why there was a hardfork with Bitcoin Cash. Bitcoin Cash has become a separate network with its own consensus because the participants did not agree with and abide by the block size consensus of the Bitcoin network. In blockchain consensus determines the truth.

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#1804
  1. All the computers in the network have to agree on the validity of the transaction and recording it on the blockchain. When they reach consensus it means the transaction is true.
  2. In a central database there is really no auditing, verification or agreements. It is simply trusted to be true.
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#1805

  1. When you have a network of computers all working together it creates a consensus. This makes it virtually impossible to cheat as the entire network has to agree that a transaction is legitimate. This works as all parties involved have incentive to follow the rules.

  2. In a central database instead of a network working together to keep the trust there is only one person or group to decide what is true. This allows that person or group to corrupt the data to benefit them. This causes mistrust of the system.

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#1806

Hey great answer! And thanks for helping out others in the forum :slight_smile:

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#1807

Q1. What does it mean when we say that in blockchain, consensus determine the truth?

Network of computers on blockchain each have a copy of the ledger. For a new transaction, each node on the network verifies the validity of the transaction based on the information available on the ledger. Consensus is achieved when all nodes confirm that the new transaction is valid and true, only then it is accepted and added to the blockchain.

Q2. How is this different from how truth is determined in a central database?

Transactions in central database are added, modified or deleted as per the business rules and specifications. The data stored in central database is mostly based on trust while blockchain public ledger data is trust less.

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#1808

In a Blockchain, consensus determines the truth by all of the nodes reaching an agreement. The miners have an incentive to promote transparency with their nodes. The incentive is making more money by being honest.

The difference in a central database, is that the nodes do not need to check a ledger with other nodes. So there is no consesus. The central database decides weather the data is good or not.

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#1809
  1. What does it mean when we say that in blockchain, consensus determine the truth?

What it means is that whatever all the nodes agree on is the truth. The nodes determine this by mathematics and the scientific method "which was in the previous lesson about provenance ", also public ledgers that each node has

  1. How is this different from how truth is determined in a central database?

because in blockchain nothing can be removed, only added. The blockchain is not controlled by one person who can change it for their own personal gain. it is decentralized

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#1810

  1. Consensus in a blockchain determines the truth by all nodes in the network being in agreement and they (miners) are financially incentivized for being honest.

  2. Centralized database can be altered and controlled by a very few and doesn’t operate in a trustless environment. The so called truth is determined by them which can also be altered by them.

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