{"id":102091,"date":"2020-10-31T17:00:00","date_gmt":"2020-10-31T14:00:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/"},"modified":"2020-10-31T17:00:00","modified_gmt":"2020-10-31T14:00:00","slug":"happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/","title":{"rendered":"# Happy birthday dear Bitcoin: Crypto\u2019s first white paper turns 12"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a25da2441c5b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a25da2441c5b\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/#Would_Satoshi_be_disappointed\" >Would Satoshi be disappointed?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/#Thwarting_fraud\" >Thwarting fraud<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/#Was_Satoshi_an_environmentalist\" >Was Satoshi an environmentalist?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/#What_is_Satoshis_legacy\" >What is Satoshi\u2019s legacy?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/happy-birthday-dear-bitcoin-cryptos-first-white-paper-turns-12\/#A_surprisingly_modest_document\" >A surprisingly modest document<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># H<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>y birthday dear Bitcoin: Crypto\u2019s first white paper turns 12  <\/strong>&#8221;<br \/>\n<img decoding=\"async\" src=\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjAtMTAvNTZkZGMzOTQtMjg3My00MTQ4LWFjYWItMmU4ZjcyNzc3MDNjLmpwZw==.jpg\" \/><\/p>\n<div data-v-5a136f3a=\"\">Has it only been a dozen years since Oct. 31, 2008, that Satoshi Nakamoto published a modest nine-page paper describing a new online payments system called \u201cBitcoin?\u201d Depending on where one stands, that pseudonymous white paper \u2014 its author(s) remain unidentified \u2014 fostered either a fintech revolution or, as some <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.vox.com\/2018\/4\/24\/17275202\/bitcoin-scam-cryptocurrency-mining-pump-dump-fraud-ico-value\">believe<\/a>, \u201cthe greatest scam in history.\u201d\u00a0<\/p>\n<p>To mark the anniversary of the publication of \u201c<a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/nakamotoinstitute.org\/bitcoin\/\">Bitcoin: A Peer-to-Peer Electronic Cash System<\/a>,\u201d Cointelegraph invited comments on the enduring vision of the paper\u2019s author. Would Satoshi Nakamoto have been pleased with how Bitcoin and blockchain <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> have developed and evolved over the past 12 years?<\/p>\n<p>James Angel, an associate professor at Georgetown University\u2019s McDonough School of Business, told Cointelegraph: \u201cIt has set in motion a revolution in finance with the rise of DeFi apps, smart contracts, and coin offerings, in addition to a payment revolution that is leading to central bank digital currencies.\u201d Gina Pieters, an assistant instructional professor at the University of Chicago\u2019s economics department, told Cointelegraph: \u201cHe would be pleased to see the evolution and new applications of his vision.\u201d<\/p>\n<p>The influence of Bitcoin\u2019s (BTC) white paper goes beyond finance<strong>, <\/strong>Garrick Hileman, head of research at Blockchain.com, told Cointelegraph: \u201cIts impact is worthy of being considered alongside other major technical innovations, such as the personal computer and internet.\u201d <\/p>\n<h2><span class=\"ez-toc-section\" id=\"Would_Satoshi_be_disappointed\"><\/span>Would Satoshi be disappointed?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Satoshi\u2019s vision was for a P2P, or decentralized, digital cash system \u2014 as referenced in the white paper\u2019s title. The problem with incumbent digital commerce was that it relied exclusively on \u201cfinancial institutions serving as trusted<em> <\/em>third parties to process electronic payments,\u201d Satoshi wrote. This had inherent weaknesses. Transactions could be reversed, banks had to <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a>te disputes, and transaction costs were high. Satoshi\u2019s solution was presented in the second paragraph of the white paper\u2019s introduction:<\/p>\n<blockquote><p>\u201cWhat is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party.\u201d<\/p><\/blockquote>\n<p>In the 12 years since the paper\u2019s publication, the need for P2P transactions \u2014 without interfering third parties \u2014 has become something of an article of faith among Bitcoinists. But, on reflection, has this aspect of Satoshi\u2019s vision been fulfilled? David Yermack, a professor of finance at New York University\u2019s Leonard N. Stern School of Business, told Cointelegraph:<strong> <\/strong><\/p>\n<blockquote><p>\u201cI think the greatest source of disappointment for Nakamoto would be the increasing centralization of blockchain governance in entities such as mining pools and even central banks, which are on the verge of launching their own cryptocurrencies. Nakamoto\u2019s mission was to challenge the hegemony of central banks, and ironically, the greatest issuers of digital currencies seem likely to be the central banks themselves.\u201d<\/p><\/blockquote>\n<p>Angel went further: \u201cSatoshi would be appalled at the politics of concentrated mining pools that currently dominate the Bitcoin protocol.\u201d While Pieters added that Satoshi would be disappointed that the \u201cprimary transactions of Bitcoin were not occurring through peer-to-peer trading, but rather intermediated by centralized exchanges or companies.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Thwarting_fraud\"><\/span>Thwarting fraud<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The matter of fraud in digital transactions has always loomed, and in Bitcoin\u2019s white paper Satoshi proposed a way to solve the classic \u201cdouble-spend\u201d problem \u2014 where miscreants spend the same coin twice, something not difficult to do with electronic coins. He did this using a \u201cpeer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions.\u201d In this way, explained Satoshi, \u201ctransactions that are computationally impractical to reverse would protect sellers from fraud.\u201d <\/p>\n<p>Solving the double-spend problem today is considered one of Satoshi\u2019s greatest achievements. His Bitcoin blockchain has never been hacked (though the same can\u2019t be said for the many crypto exchanges that trade BTC). Still, fraud associated with digital payments has not been squeezed out of the system. Would this have dismayed Bitcoin\u2019s founder?<\/p>\n<p>Angel said that Satoshi would \u201chave been disappointed that Bitcoin did not turn into an everyday payment medium but instead a store of value for fearful fatcats and tax evaders.\u201d Moreover, Satoshi would \u201chave been saddened by the increase in inequality that Bitcoin\u2019s history has created, with a few early adopters becoming whales and the other 99.99999% of the population as have nots.\u201d Still, one assumes Bitcoin\u2019s creator \u2014 whether man, woman or group \u2014 would have marveled at the breadth of BTC\u2019s adoption, as Yermack outlined: <\/p>\n<blockquote><p>\u201cNakamoto would be astonished by the growth of blockchain projects and the many thousands of digital coins and tokens that have been created in the image of Bitcoin. One suggestive piece of evidence is that Nakamoto fixed the size of the blocks on the Bitcoin blockchain at 1MB in 2010 and mysteriously commented that \u2018we can always increase this later when we need to.\u2019\u201d<\/p><\/blockquote>\n<p>He had no inkling that the blockchain would become overloaded within the next five or six years, continued Yermack, \u201cand that a contentious debate, still unresolved today, would break out among different constituencies of Bitcoin about the best way to expand the blockchain\u2019s capacity further.\u201d <\/p>\n<p>In the past 12 years, most of Satoshi\u2019s original software code has been altered or substituted, added Hileman, but still, Bitcoin has retained its key foundational qualities, including \u201cits fixed supply of 21 million coins, open access, and censorship\/tamper resistance. I believe Satoshi would be happy with the ongoing software optimizations and improvements to these core foundational characteristics that continue today.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Was_Satoshi_an_environmentalist\"><\/span>Was Satoshi an environmentalist?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>While the white paper says a lot about transaction fees, CPU power, network nodes, proof-of-work chains, and even the Gambler\u2019s Ruin problem, it says nothing much about the larger world around, including the environment. Angel contends that Satoshi would be shocked by the environmental damage caused by the Bitcoin mining arms race, adding: \u201cAt current hash rates and mining efficiency, Bitcoin mining alone is consuming about seven gigawatts of electricity, which is the equivalent to seven Chernobyl power plants.\u201d <\/p>\n<p>And while little is known about Satoshi\u2019s politics, his creation, in the form of the first crypto blockchain, would also be disturbed by the idea of central bank digital currencies, and in some cases, \u201cthose currencies are designed for repressive governments to engage in even more surveillance and control over their populations,\u201d added Angel.<\/p>\n<p>Focusing on the white paper proper, Franklin Noll, a monetary historian and the president of Noll Historical Consulting, told Cointelegraph: \u201cHis concern was with speedy, anonymous, low cost, non-mediated, non-reversible transactions. So far, Bitcoin transactions \u2014 and many other blockchain transactions \u2014 have not been found to be all that speedy, anonymous, or low cost.\u201d He further added:<\/p>\n<p>\u201cI believe Satoshi would want to see more use of non-custodial wallets to store and transact Bitcoin,\u201d added Hileman, who explained that custody firms that manage private cryptographic keys on behalf of Bitcoin owners \u201cresemble traditional banks.\u201d Meanwhile, he believes that \u201cSatoshi was not a fan of trusted third-party financial intermediaries.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"What_is_Satoshis_legacy\"><\/span>What is Satoshi\u2019s legacy?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>After a little more than a decade later, what is the significance of Satoshi Nakamoto\u2019s white paper? In the financial sphere, \u201cIt incentivized financial companies and central banks to prioritize evaluating their technology, considering both increased digitization and \u2018always-on\u2019 digital platforms,\u201d Pieters opined, continuing: \u201cIn some cases, like the renewed examinations of CBDCs, this has led to explorations of new systems even if it is not directly the adoption of blockchain technology.\u201d<\/p>\n<p>\u201cBitcoin and blockchain have fundamentally changed the monetary world,\u201d added Noll. \u201cTerms like proof-of-work, distributed ledger technology, decentralized finance, programmable money and smart contracts are now part of the lexicon of anyone serious about the future of money and finance.\u201d Hileman added: <\/p>\n<blockquote><p>\u201cWe are also only beginning to understand the potential impact of blockchain technology in areas outside of finance, such as digital identity, addressing the problem of fake <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">news<\/a>, and public election tampering.\u201d<\/p><\/blockquote>\n<p>\u201cThe publication of Nakamoto\u2019s 2008 paper was an important turning point in financial record-keeping,\u201d said NYU\u2019s Yermack. \u201cWe are only beginning to understand the ramifications, but they appear to be vast.\u201d<\/p>\n<h2><span class=\"ez-toc-section\" id=\"A_surprisingly_modest_document\"><\/span>A surprisingly modest document<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>One won\u2019t find the word \u201crevolution\u201d in Satoshi\u2019s paper. There is nothing about overturning the economic order or narrowing the gap between rich or poor. It\u2019s an unassuming treatise on electronic payments \u2014 how they can be made to function effectively.<\/p>\n<p>On his own terms, Satoshi succeeded wildly. He promised a workable P2P digital payment system, and he delivered. The market value of Bitcoin stands at $251 billion 12 years after the idea was unveiled. <\/p>\n<p>Whether Bitcoin is also harming the environment, abetting money launderers or propping up political regimes, goes beyond the scope of his paper. What can be said is that economic decentralization continues to present governance challenges. How much \u201cpeer-to-peer\u201d does society really want? The larger global community will have to decide. <\/p>\n<p>Twelve years out from the publication of \u201cBitcoin: A Peer-to-Peer Electronic Cash System,\u201d it\u2019s worth remembering that \u201cit is a dictum of history that revolutions do not always turn out as the founders planned,\u201d Noll told Cointelegraph. <\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"\/><\/div>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more News articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener noreferrer\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/happy-birthday-dear-bitcoin-crypto-s-first-white-paper-turns-12\" target=\"_blank\" rel=\"noopener noreferrer\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# Happy birthday dear Bitcoin: Crypto\u2019s first white paper turns 12 &#8221; Has it only been a dozen years since Oct. 31, 2008, that Satoshi Nakamoto published a modest nine-page paper describing a new online payments system called \u201cBitcoin?\u201d Depending on where one stands, that pseudonymous white paper \u2014 its author(s) remain unidentified \u2014 fostered&#8230;<\/p>\n","protected":false},"author":1,"featured_media":102092,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/s3.cointelegraph.com\/uploads\/2020-10\/56ddc394-2873-4148-acab-2e8f7277703c.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74894,74983,77721],"class_list":["post-102091","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-blockchain","tag-decentralization","tag-whitepaper"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/102091","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=102091"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/102091\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/102092"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=102091"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=102091"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=102091"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}