Development of bitcoin
Satoshi Nakamoto stated that work on the writing of the code for bitcoin began in 2007. On 18th August 2008, he or a colleague registered the domain name bitcoin.org, and created a web site at that address. On 31st October 2007, Nakamoto published a white paper (whitepaper being the instructions on the crypto and any utility present or potential utility for the future) on the cryptography mailing list at metzdowd.com describing a digital cryptocurrency, titled “Bitcoin: A Peer-to-Peer Electronic Cash System”. Clearly, a genius of names too.
On 9 January 2009, Nakamoto released version 0.1 of the bitcoin software on Source Forge and launched the network by defining the genesis block of bitcoin (block number 0) aka patient 0, which had a reward of 50 bitcoins. Embedded in the coinbase transaction of this block is the text: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks”, citing a headline in the UK newspaper The Times published on that date. This note has been interpreted as both a timestamp and a derisive comment on the instability caused by fractional-reserve banking. It’s understandable to take a jab at centralisation while proving the stamping mechanism works, two birds with one stone.
Nakamoto continued to collaborate with other developers on the bitcoin software until mid-2010, making all modifications to the source code himself. He then gave control of the source code repository and network alert key to Gavin Andresen (software engineer), transferred several related domains to various prominent members of the bitcoin community, and stopped his recognized involvement in the project altogether. Just like that he vanished into thin air after accomplishing fundamentally a new digital age. I would say that Nakamoto was genuinely looking to make a difference by giving the people more financial freedom and assumed that any fame would deter from the project. Some might say that he wanted Bitcoin to be seen in its own right and not diminished with connotations of its creator. The inner workings of a socialist hero?
In 2021, a monument was announced in honour of Nakamoto in Budapest, Hungary for his work on Bitcoin and cryptocurrency technology. Not sure Hungary understood the concept behind the pseudonym and Nakamoto keeping the real identity a secret.
Characteristics and identity
Nakamoto has never revealed personal information when discussing technical matters, though has at times provided commentary on banking and fractional-reserve banking. On his P2P Foundation profile as of 2012, Nakamoto claimed to be a 37-year-old male who lived in Japan; however, some speculated he was unlikely to be Japanese due to his native-level use of English. Although, this could be a red herring in itself and only makes the plot even more juicy.
Some have considered that Nakamoto might be a team of people: Dan Kaminsky, a security researcher who read the bitcoin code, said that Nakamoto could either be a “team of people” or a “genius”; Laszlo Hanyecz, a developer who had emailed Nakamoto, had the feeling the code was too well designed for one person; John McAfee, creator of McAfee security, claimed Nakamoto was “a team of eleven people”. Gavin Andresen has said of Nakamoto’s code: “He was a brilliant coder, but it was quirky.”
The use of British English in both source code comments and forum postings – such as the expression “bloody hard”, terms such as “flat” and “maths”, and the spellings “grey” and “colour” – led to speculation that Nakamoto, or at least one individual in a consortium claiming to be him, was of Commonwealth origin. The reference to London’s Times newspaper in the first bitcoin block mined by Nakamoto suggested to some a particular interest in the British government.
Stefan Thomas, a Swiss software engineer and active community member, graphed the timestamps for each of Nakamoto’s bitcoin forum posts (more than 500); the chart showed a steep decline to almost no posts between the hours of 5 a.m. and 11 a.m. Greenwich Mean Time. This was between 2 p.m. and 8 p.m. Japan Standard Time, suggesting an unusual sleep pattern for someone supposedly living in Japan. As this pattern held true even on Saturdays and Sundays, it suggested that Nakamoto consistently was asleep at this time. Suggested, but if Nakamoto was an enigma to create such a technology and keep his identity hidden there is no guarantee that we can say he followed the norms or is even a he. Genius level intellect is a given, so nothing is off the cards.
Many have claimed the title as the creator of cryptocurrency in pursuit of fame and glory, even going as far as trying to sue people for copying the open-source code behind the tech. but I generally find it hard to believe that someone or a group of people dead set on creating a free open source technology designed to be decentralised, all while keeping their identity hidden, would then want to claim their work 7 years down the line in such a vulgar manner. Too much conflicting ideologies to believe that it could be the same person.
What is Blockchain?
Blockchain is the underlying technology that was created in order to secure and record the transactions of cryptocurrency, it was created upon the birth of bitcoin. Two ultimate inventions for one, initial, utility.
Blockchain seems complicated, and it definitely can be, but its core concept is really quite simple. A blockchain is a type of database. To be able to understand blockchain, it helps to first understand what a database actually is.
A database is a collection of information that is stored electronically on a computer system. Information, or data, in databases is typically structured in table format to allow for easier searching and filtering for specific information.
Once you understand what a database is then you can define what blockchain is by these points:
- Blockchain is a specific type of database.
- It differs from a typical database in the way it stores information; blockchains store data in blocks that are then chained together.
- As new data comes in it is entered into a fresh block. Once the block is filled with data it is chained onto the previous block, which makes the data chained together in chronological order.
- Different types of information can be stored on a blockchain, but the most common use so far has been as a ledger for transactions.
- In Bitcoin’s case, blockchain is used in a decentralized way so that no single person or group has control—rather, all users collectively retain control.
- Decentralized blockchains are immutable, which means that the data entered is irreversible. For Bitcoin, this means that transactions are permanently recorded and viewable to anyone.
Due to how blockchain is created it is incredibly difficult to actually hack into thus it’s appeal to tech. security companies and banks alike, however, it is not impossible and unfortunately the ultimate chink in its armour is human error.
What is cryptocurrency?
All this talk of bitcoin but what is crypto exactly and how does it differ from how you spend money currently? Cryptocurrency is a form of payment that can be exchanged online for goods and services. Many companies have issued their own currencies, often called tokens, and these can be traded specifically for the good or service that the company provides. Think of them as you would arcade tokens or casino chips. You’ll need to exchange real currency for the cryptocurrency to access the good or service. Cryptocurrencies can only work using blockchain.
These are the 10 largest trading cryptocurrencies by market capitalization as tracked by CoinMarketCap, a cryptocurrency data and analytics provider.
| Cryptocurrency | Market Capitalization |
| Bitcoin | $608.6 billion |
| Ethereum | $240.4 billion |
| Tether | $61.8 billion |
| Binance Coin | $48.6 billion |
| Cardano | $37.6 billion |
| XRP | $27.4 billion |
| USD Coin | $26.9 billion |
| Dogecoin | $24.9 billion |
| Polkadot | $12.5 billion |
| Binance USD | $11.5 billion |
Market capitalization refers to the total dollar market value of a company’s outstanding shares of stock. Commonly referred to as “market cap,” it is calculated by multiplying the total number of a company’s outstanding shares by the current market price of one share.
Why are cryptocurrencies so popular?
Cryptocurrencies appeal to their supporters for a variety of reasons. Here are some of the reasons I picked
- I see cryptocurrencies such as Ethereum as the currency of the future and are racing to buy them now, presumably before they become more valuable.
- I like the fact that cryptocurrency removes central banks from managing the money supply, since over time these banks tend to reduce the value of money via inflation.
- The technology behind cryptocurrencies, the blockchain, is fascinating because it’s a decentralized processing and recording system and can be more secure than traditional payment systems.
- I love cryptocurrencies because they’re going up in value and have no interest in the currencies’ long-term acceptance as a way to move money.
- As long as governments have maintained monopoly power over the printing presses, there has existed a temptation to devalue a country’s sovereign currency. In order to mitigate or at least function through such a collapse, individuals throughout history have turned to alternatives to state-backed money.
- So, cryptocurrency is just the most recent in a long line of solutions to this problem. While Satoshi developed Bitcoin in the wake of the 2008 financial crisis, other countries have already seen subsequent financial disasters.
Why Governments Should Promote Cryptocurrency
The biggest claim made by this blog is a sum of these points. Namely, people find that governments can protect their currency by promoting digital currencies. This is precisely because it allows people to maintain their wealth during recessions while also making purchases. These local purchases, the government still taxes to generate revenue.
Following the financial crisis, a number of developing countries have experienced significant declines in the value of their sovereign currencies, bordering on crisis levels. Two examples are the Turkish lira and the Argentine peso. These are the first currency crises since the creation of Bitcoin, and therefore they offer an opportunity to investigate the impact that alternative digital currencies have on unstable sovereign markets.
However, this blog is just for speculation and information none of this is financial advice or advice in general. We all have our bias including myself so do what you will with this new found tale embroidered into your mind.
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S7 Bonus: "Chaos Special" – I Digress
S7 Bonus: "Chaos Special" – I Digress
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