Welcome to the first module of Blockchain Technology, the second course in the

Blockchain
Fundamentals program.
This course is a continuation of our first course, Bitcoin and Cryptocurrencies; if
you
haven’t already, please take a look at that course.
In the first course, we studied Bitcoin as the first use case for blockchain and
examined
its various components and properties.
We also looked at how blockchain is used for cryptocurrencies and generalized
computational
platforms, such as Ethereum.
By now, you’ve decoupled the concept of blockchain from cryptocurrencies to
understand
all the pieces individually and how they fit together.
This first week, we’ll be covering distributed systems and consensus algorithms.
You should be familiar with Bitcoin, one of the largest cryptocurrencies, and its
use
of Proof-of-Work to make sure everyone agrees – or comes to consensus – on who owns
what amounts of bitcoin.
This is what Bitcoin accomplishes, but what is the underlying problem that Bitcoin
is
trying to solve?
Well, it’s truly a distributed systems problem: several computers, all unknown and
untrusting
of each other, are trying to agree on something.
Understanding the fundamental purpose and challenges of building distributed
systems
will give us the ability to understand the subset that is blockchain.
First, we’ll go over distributed systems fundamentals and the consensus problem,
some
tradeoffs and formalisms, and traditional literature in the space.
Then, we’ll look at Nakamoto Consensus, a new paradigm of distributed consensus,
and
examine how it fits into the traditional model of distributed systems, with a focus
on Proof-of-Stake
and other new styles of consensus.
After this lecture, you’ll be able to think about blockchain within the much larger
scope
of distributed systems and consensus.