Homework on Consensus - Questions

Blockchain and Bitcoin 101
#1851

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

By having several different entities on the network being incentivised to verify the
authenticity and accuracy of every single transaction in real-time, and every single
entity having to be in an agreement with each other that said transaction is in fact
valid and accurate before committing it to the blockchain, the “trust-factor” of a
single entity is completely removed, ensuring that the transaction is at all times
the absolute truth once commited to the blockchain.

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

On a central database there aren’t several different entities that will verify that the transaction
being added to the database is infact valid and the truth, and therfore needs to trust that the
entity adding the transaction does so truthfully and accurately, which adds the risk of entities
being able to abuse this for their own personal gain. Adding to this the fact that you do not have
real-time auditing capability, drastically increases the risk due to the abuse only being identified
when it is too late to take action.

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#1852

1 - What does it mean when we say that in blockchain, consensus determine the truth?
Consensus is used in blockchain to verify transactions, and it’s based on honesty and agreement of a group of people
2 - There’s usually a central authority that can decide the truth, so the system can be cheated and is dependant of honesty of 1 person, whereas in blockchain you have a group of people working towards the same result and it’s impossible to cheat.

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#1853

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

Multiple parties have to communicate and all agree with each other that the data is real, otherwise it won’t be added onto the blockchain.

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

Central database can be run by one entity and it can make decision without any other parties involved which could lead to false data.

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#1854
  1. consensus removes the need to trust, we determine the truth by verifying. it is everyone’s incentive to tell the truth. if someone isn’t playing by the rules, they get caught out quickly as the transaction is then not verified by all parties.
  2. a centralized database is not public and can be falsely verified.
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#1855

Great answer. In most cases it happens just like you said it. :raised_hands:

3 Likes
#1856

Homework on Consensus - Questions

  1. What does it mean when we say that in blockchain, consensus determine the truth?
    A. All the nodes on a network agree that the transaction makes sense and therefore is the truth otherwise it gets discarded.
  2. How is this different from how truth is determined in a central database?
    A. A central database can have data changed or removed by one actor whereas the blockchain ledger nothing can be changed or removed and all nodes have to agree.
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#1857

  1. Consensus determines the truth in blockchain because so many miners follow the rules. As soon as someone else comes along and makes their own rules all the miners that follow them can call the “liar” out. “Hey, this transaction doesn’t make sense”. Or in the yoghurt example. “Hey, this manufacturer is lying about it’s product.” When the network has provenance and the network of computers agree, we achieve a system that doesn’t need trust.

  2. When you have a central database. Take the federal reserve as a example. People who hold cash aren’t really aware of that their dollars lose value. The fed prints money, and it isn’t publicly known how much they print, and who gets the money.

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#1858

And that it won’t be changed later on in the future. :slight_smile:

2 Likes
#1859

Great answers! Keep up the great work. :muscle:

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#1860

Another great and very detailed homework. Outstanding! Keep it up. :raised_hands:

2 Likes
#1861

Exactly. It is usually controlled by several selected people or sometimes even just by a a single person. :smiley:

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#1862
  • What does it mean when we say that in blockchain, consensus determine the truth?

A certain number of members of the network would need to verify a transaction for it to be true.

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

A central database is owned by an individual entity and essentially so is the truth. Information is altered by the people who have access to the database.

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#1863

Consensus provides a mechanism where different computers can verify data before being posted permanently to the blockchain data base.

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#1864

What about the second question?

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

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#1865

A central data base does not require consensus from other computers (and data bases) and can therefor be incorrect or manipulated.

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#1866

When using consensus in a blockchain to determine the truth, multiple points of validation are required. There are multiple sources of information sharing information to check facts on the provenance.
That is, several parties are required to validate information from one party.

Truth is determined from one central point of authority in a central database. Consensus is different through validation on multiple points of authority.

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#1867

  1. What does it mean when we say that in blockchain, consensus determine the truth?
    All Computers in the network need to agree on a transaction. the Blockchain is built on
    incentivizing people to play by the rules. If you don’t play by the rules, your transaction will be rejected or simply ignored. Miners playing against the rules will not be rewarded.

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

the owner of the central entity or database decides on the truth

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#1868

Consensus determines truth because when all computers agree upon a certain truth, the network won’t allow bad actors to infiltrate the network and make false claims.

In a central database, the owner of said database can alter the information that is stored whereas a decentralized database requires all computers to agree to a certain truth.

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#1869

  1. In blockchain, consensus depends on the fact that everyone is incentive to play by the rules.

  2. In a central database the information can be modified by the person who controls it.

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#1870

1.) That all the nodes in a decentalized network are in agreement about the database.

2.) In a centilized network, the owner determines the truth based on trust me do not verify.

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