Create PoWAlgorithm.py

Author: anurags10

blockchain/PoWAlgorithm.py

@@ -0,0 +1,129 @@
+"""
+# Title: Proof of Work Algorithm for Blockchain
+
+## Algorithm Statement:
+The algorithm implements the Proof of Work (PoW) consensus mechanism used in blockchain to validate blocks. PoW is used to ensure that participants (miners) must perform a computational task to create a valid block and add it to the blockchain. The difficulty of the task is defined by the number of leading zeros required in the hash of the block.
+
+## Approach:
+1. Each block contains a list of transactions, a previous block's hash, a timestamp, and a nonce (random value).
+2. The block is hashed using the SHA-256 cryptographic hash function.
+3. The miner's goal is to find a nonce such that the resulting hash has a certain number of leading zeros, which defines the difficulty level.
+4. The difficulty is adjustable. The more leading zeros required, the harder it is to find a valid nonce.
+5. This process is repeated until a valid hash is found, which demonstrates that computational work has been done (Proof of Work).
+
+## Steps:
+1. Create a `Block` class to hold block details (transactions, previous hash, timestamp, and nonce).
+2. Implement a `Blockchain` class that adds new blocks to the chain by solving the PoW problem.
+3. Implement the hashing function using SHA-256.
+4. Adjust the difficulty by varying the number of leading zeros required in the hash.
+5. Use test cases to validate the PoW algorithm.
+"""
+
+import hashlib
+import time
+
+class Block:
+    def __init__(self, index, previous_hash, transactions, timestamp, difficulty):
+        self.index = index
+        self.previous_hash = previous_hash
+        self.transactions = transactions
+        self.timestamp = timestamp
+        self.nonce = 0  # Start with nonce 0
+        self.difficulty = difficulty
+        self.hash = self.compute_hash()
+
+    def compute_hash(self):
+        """
+        Generates the hash of the block content.
+        Combines index, previous hash, transactions, timestamp, and nonce into a string, 
+        which is then hashed using SHA-256.
+        """
+        block_string = f"{self.index}{self.previous_hash}{self.transactions}{self.timestamp}{self.nonce}"
+        return hashlib.sha256(block_string.encode()).hexdigest()
+
+    def mine_block(self):
+        """
+        Performs Proof of Work by adjusting the nonce until a valid hash is found.
+        A valid hash has the required number of leading zeros based on the difficulty level.
+        """
+        target = '0' * self.difficulty  # Target hash should start with 'difficulty' number of zeros
+        while self.hash[:self.difficulty] != target:
+            self.nonce += 1
+            self.hash = self.compute_hash()
+
+        print(f"Block mined with nonce {self.nonce}, hash: {self.hash}")
+
+class Blockchain:
+    def __init__(self, difficulty):
+        self.chain = []
+        self.difficulty = difficulty
+        self.create_genesis_block()
+
+    def create_genesis_block(self):
+        """
+        Creates the first block in the blockchain (the Genesis block).
+        """
+        genesis_block = Block(0, "0", "Genesis Block", time.time(), self.difficulty)
+        genesis_block.mine_block()
+        self.chain.append(genesis_block)
+
+    def add_block(self, transactions):
+        """
+        Adds a new block to the blockchain after performing Proof of Work.
+        """
+        previous_block = self.chain[-1]
+        new_block = Block(len(self.chain), previous_block.hash, transactions, time.time(), self.difficulty)
+        new_block.mine_block()
+        self.chain.append(new_block)
+
+    def is_chain_valid(self):
+        """
+        Verifies the integrity of the blockchain by ensuring each block's previous hash matches 
+        and that all blocks meet the Proof of Work requirement.
+        """
+        for i in range(1, len(self.chain)):
+            current_block = self.chain[i]
+            previous_block = self.chain[i - 1]
+
+            if current_block.hash != current_block.compute_hash():
+                print(f"Invalid block at index {i}. Hash mismatch.")
+                return False
+
+            if current_block.previous_hash != previous_block.hash:
+                print(f"Invalid chain at index {i}. Previous hash mismatch.")
+                return False
+
+        return True
+
+# Test cases
+
+def test_blockchain():
+    """
+    Test cases for the Blockchain proof of work algorithm.
+    """
+    # Create blockchain with difficulty level of 4 (hash should start with 4 zeros)
+    blockchain = Blockchain(difficulty=4)
+
+    # Add new blocks
+    blockchain.add_block("Transaction 1: Alice pays Bob 5 BTC")
+    blockchain.add_block("Transaction 2: Bob pays Charlie 3 BTC")
+
+    # Verify the integrity of the blockchain
+    assert blockchain.is_chain_valid() == True, "Blockchain should be valid"
+
+    # Tamper with the blockchain and check validation
+    blockchain.chain[1].transactions = "Transaction 1: Alice pays Bob 50 BTC"  # Tampering the transaction
+    assert blockchain.is_chain_valid() == False, "Blockchain should be invalid due to tampering"
+
+    print("All test cases passed.")
+
+if __name__ == "__main__":
+    test_blockchain()
+
+"""
+# Output:
+- Block mined with nonce X, hash: 0000abcd...
+- Block mined with nonce Y, hash: 0000xyz...
+- Block mined with nonce Z, hash: 0000pqrs...
+- All test cases passed.
+"""