Today we can no longer imagine our society without information and communications technologies (ICT). When these do not work we have difficulties to travel, we cannot read the email and even our life can be in danger. We need to rely on these technologies, and for this we need a plan that protects them and guarantees their reliability. Blockchain was born with this goal.

Blockchain emerged alongside Bitcoin to replace central banks. It is an alternative to the classic third party trust concept (TTP). A central bank is a type of TTP that attests to the money that a certain agent owns, and that validates the exchanges of money between individuals and organizations.

WHAT IS THAT OF TTP?

If Juan wants to send information to Petra, he must use a communication channel that allows him to be sure that Petra is at the other end of the channel. Traditionally, a TTP has been used to build the guarantee that Juan needs. Once you have that guarantee, for example, you can use symmetric key cryptography to send and receive information without interception by untrusted third parties.

This privileged position of TTP involves a double risk:

A TTP can be attacked. This would allow access to confidential information by an unauthorized agent, as has happened with the filtering of user passwords, access to private information due to access control failures and the impersonation of TTP by social engineering. A TTP can use its privileged position and, without our permission, analyze our activity and extract behavior patterns, sell profiles to third parties and train algorithms with our data.
DECENTRALIZE TRUST

To avoid these risks it is reasonable to think about implementing a TTP on a distributed basis. This is how peer networks or P2P for content storage and distribution arise, with BitTorrent and eMule as significant representatives of this ecosystem. As of 2008, Bitcoin and its support, Blockchain, joined it.

Bitcoin consists of a cryptographic layer, a P2P communication protocol and a community with interest in financial collaboration. The cryptographic layer uses cryptographic hashes and digital signatures to agree on the writing of accounting notes (transactions) without an intermediary. These transactions are grouped in blocks by a group of special users, the miners.

Miners try to solve a computationally expensive mathematical challenge, the proof of work (PoW, Proof of Work). The first miner to solve the challenge at any given time, introduces a block in the Blockchain and obtains a reward, which is equivalent to creating currency. It can be shown that the selection of the lucky miner is quasi-random, which avoids the problem of double spending and guarantees the immutable nature of the Blockchain.

This disintermediation is not without friction. If until now the accumulation of financial capital could destabilize an economic system, in Bitcoin such a risk is given by the accumulation of computing capacity. Today the miner is not a user with a simple personal computer: there are computer centers (or mining farms) dedicated exclusively to the creation of Bitcoin blocks. If a mining farm accumulates more than half of the overall computing capacity, it could rewrite blocks, which would violate the immutability of Blockchain. In 2014 the GHash.io farm reached this privileged situation, although it refused to exploit it.

The Bitcoin governance deficit adds that the energy consumption associated with mining is excessively high. This, together with other factors, motivates the search for more efficient and safe consensus mechanisms.