Overview

17/10/18 08:52 UTC-4

White Paper, as source of Bitcoin

White Paper of Bitcoin
White Paper of Bitcoin

By the first stop for all, who to them is seriously interested, is White Paper: canonical document of Satoshi Nakamoto. His person is mystery for all. He began his work above the code of bitcoin as early as 2007. In 2008 presented it and declared that developed a new method of cash of electronic money, the key principle of which is equality, without intermediaries engagement.

 

The first perception of the project

To one's essence, bitcoin should become way online payments. In the first days bitcoin admirers tried to use him in all domains – salary, pizza, production of bitcoin. It corresponded the promises of Nakamoto, but there was no expected effect nevertheless. It simply was not enough of the sellers, accepting new currency, or enough customers having this currency.

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It resulted in growth of startups, such as BitPay, which facilitated payment by the bitcoins for such companies, as Microsoft and Overstock. BitPay and similar to it startups though increased utility of bitcoins, but kind of his intermediary was represented who should disintegrate.

Theoretically, you should manage to get access to the bitcoin, not having opportunities to exchange it to any real currency or to interact with any by financial institution, functions of which successfully is executed top-class cryptography and by distributed computers network of users of this cryptocurrency.

All that you should for its acquisition – it computer connected to Internet. You load Bitcoin client and you bitcoin in exchange for service could be sent, or to use a computational capacity of your computer for support of the network and receipt of the remuneration in bitcoins. After you have a bitcoin, you can use the same tools for his storage and use.

 

Becoming of new digital currency

But only the most early, most devoted users of new cryptocurrency accepted this system and almost at once started to emerge intermediaries. In January 2009 the first block emerged - genesis and the first transaction was held. In October of this year bitcoin rate was installed, according to which $ 1 was equal 1 309,03 BTC. This rate depended on price to the electric power which was used for production of electronic coin.

In 2010 two known bitcoin stock exchanges – The Bitcoin Market and Mt. Gox. Even dark Internet-stock exchanges, in which the most actively bitcoin was used, were intermediaries, disseminating information between buyers and granting deposits.

 

Work principles

In development of new coin system was very important: for each separate address its secret key was created, and for each new transaction it is necessary to create a new address. Along with that too confusing and burdensome process, services of wallets emerged, in which users' electronic currency was stored, similarly to bank account and are replaced by the password for secret key. In the system of Bitcoin there are many other intermediaries, including the sellers of hardware and server farms which monopolized creation of new bitcoins.

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Existence of these intermediaries as well eliminates one more feature of the bitcoin: confidentiality. Such intermediaries, as Coinbase, are limited by the legislation "know your customer" and they assemble an extensive information of their users.

Bitcoin should disintegrate a financial branch – the system of the banks and intermediaries, and transaction collections, in which uniform structure can keep your money as guarantee. Instead of it he repeated this system. Common users trust third parties to verify transactions and to keep their money. Price is so changeable that nobody wants to use bitcoin for payments. Prices to electricity, needed for support of the network as well promptly grew.

After 9 years, new cryptocurrency broke all records and broke all stereotypes of financial system, possessing hugest capital on the market and the trust of its owners. This revolutionary project is not going to hand in turn-overs, still is required and its development successfully continues. Today cost of the bitcoin accounts for more than $ 6000, and his sales and purchase for days is made by billions BTC.

 


White Paper will remain forever required among cryptocommunity. While for new users it will explain, what is electronic money, as well as to open main principles of this electronic system of payments and detailed scenario of its use.

Editor: Yuliya Soroka

#WhitePaper #Bitcoin #SatoshiNakamoto

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