Satoshi Nakamoto

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pages: 233 words: 66,446

Bitcoin: The Future of Money? by Dominic Frisby

3D printing, altcoin, bank run, banking crisis, banks create money, barriers to entry, bitcoin, blockchain, capital controls, Chelsea Manning, cloud computing, computer age, cryptocurrency, disintermediation, Ethereum, ethereum blockchain, fiat currency, fixed income, friendly fire, game design, Isaac Newton, Julian Assange, land value tax, litecoin, M-Pesa, mobile money, money: store of value / unit of account / medium of exchange, Occupy movement, Peter Thiel, Ponzi scheme, prediction markets, price stability, QR code, quantitative easing, railway mania, Ronald Reagan, Ross Ulbricht, Satoshi Nakamoto, Silicon Valley, Skype, slashdot, smart contracts, Snapchat, Stephen Hawking, Steve Jobs, Ted Nelson, too big to fail, transaction costs, Turing complete, War on Poverty, web application, WikiLeaks

,’ Sourceforge, July 6, 2010, accessed May 22, 2014, http://bit.ly/1tru7NE. 100 Satoshi Nakamoto, ‘Bitcoin P2P e-cash paper,’ Cryptography Mailing List, November 8, 2008, accessed May 20, 2014, http://bit.ly/1truasP. 101 Satoshi Nakamoto, ‘Bitcoin P2P e-cash paper,’ Cryptography Mailing List, November 8, 2008, accessed May 20, 2014, http://bit.ly/1truasP. 102 Satoshi Nakamoto, ‘Bitcoin open source implementation of P2P currency,’ P2P Foundation, February 11, 2009, accessed January 28, 2014, http://bit.ly/1tHFaWL. 103 Satoshi Nakamoto, ‘tcatm’s 4-way SSE2 for Linux 32/64-bit is in 0.3.10,’ BitcoinTalk, August 19, 2010, accessed March 5, 2014, http://bit.ly/1trBchb. 104 Satoshi Nakamoto, ‘tcatm’s 4-way SSE2 for Linux 32/64-bit is in 0.3.10,’ BitcoinTalk, August 15, 2010, accessed March 5, 2014, http://bit.ly/1trBfts. 105 Satoshi Nakamoto, ‘tcatm’s 4-way SSE2 for Linux 32/64-bit is in 0.3.10’, BitcoinTalk, August 15, 2010, accessed March 5, 2014, http://bit.ly/1trBchd. 106 Satoshi Nakamoto, ‘tcatm’s 4-way SSE2 for Linux 32/64-bit is in 0.3.10,’ BitcoinTalk, August 15, 2010, accessed March 5, 2014, http://bit.ly/1trBftu. 107 MoonShadow, ‘re.

Once you’ve understood that, see the follow up here – http://bit.ly/1tru7NK. 109 ‘Bitcoin and me.’ 110 AnonymousSpeech.com, accessed January 22, 2014. http://bit.ly/1trBchh. 111 Satoshi Nakamoto, ‘Re: IPv6, headless client, and more,’BitcoinTalk, June 27, 2010, accessed March 10, 2014, http://bit.ly/1pLBdbX. 112 Satoshi Nakamoto, ‘Re. Potential Disaster Scenario,’ August 15, 2010, accessed March 25, 2014, http://bit.ly/1trBfJK. 113 Satoshi Nakamoto, ‘Re: wiki registration email,’ July 29, 2010, accessed March 25, 2014, http://bit.ly/1trBfJN. 114 Satoshi Nakamoto, Bitcointalk, accessed February 26, 2014, http://bit.ly/1trBfJQ and http://bit.ly/1trBchl. 115 Satoshi Nakamoto, ‘Re:URI-scehem for bitcoin,’ BitcoinTalk, February 24, 2010, accessed March 10, 2010, http://bit.ly/1trBfJS. (N.B. ‘photo it’ – is that something a native English speaker would say? I guess so, possibly, just.) 116 Satoshi Nakamoto, ‘Re: How fast do the fastest computers generate bitcoins?’

I do find a lot of Satoshi’s posts difficult to understand – particularly when he writes about coding matters – but, on the whole, his command of English is considerably better than many native-English speaking financial commentators. 119 Gwern Branwen, comments on ‘Wei_Dai comments on AALWA,’ Less Wrong, March 21, 2014, accessed March 25, 2014, http://bit.ly/1tHFaGj. 120 Satoshi Nakamoto, ‘Bitcoin v0.1 released,’ January 16, 2009, accessed March 4, 2014, http://bit.ly/1truasU. 121 Satoshi Nakamoto, ‘Re. The dollar cost of bitmining energy,’ BitcoinTalk, July 16, 2010, accessed April 10, 2014, http://bit.ly/1trBcxC. 122 Satoshi Nakamoto, ‘Re. Potential Disaster Scenario,’ August 15, 2010, accessed March 25, 2014, http://bit.ly/1trBfJK. 123 Satoshi Nakamoto, ‘Re: A few suggestions,’ BitcoinTalk, December 13, 2009, accessed March 10, 2014, http://bit.ly/1trBcxE. 124 Satoshi Nakamoto, ‘Re: Transactions and Scripts: DUP HASH160…EQUALVERIFY CHECKSIG,’ BitcoinTalk, June 18, 2010, accessed March 5, 2014, http://bit.ly/1trBcxI. 125 Satoshi Nakamoto, ‘Bitcoin open source implementation of P2P currency,’ P2P Foundation, February 11, 2009, accessed February 19, 2014. http://bit.ly/1tru840. 126 Satoshi Nakamoto Profile, P2P Foundation, accessed February 19, 2014, http://bit.ly/1tru841. 127 Satoshi Nakamoto, ‘Bitcoin P2P e-cash paper,’ Cryptography Mailing List, November 1, 2008, accessed March 2, 2014, http://bit.ly/1tHF9lM. 128 Michael J.


pages: 309 words: 54,839

Attack of the 50 Foot Blockchain: Bitcoin, Blockchain, Ethereum & Smart Contracts by David Gerard

altcoin, Amazon Web Services, augmented reality, Bernie Madoff, bitcoin, blockchain, Blythe Masters, Bretton Woods, clean water, cloud computing, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, distributed ledger, Ethereum, ethereum blockchain, Extropian, fiat currency, financial innovation, Firefox, Flash crash, Fractional reserve banking, index fund, Internet Archive, Internet of things, Kickstarter, litecoin, M-Pesa, margin call, Network effects, peer-to-peer, Peter Thiel, pets.com, Ponzi scheme, Potemkin village, prediction markets, quantitative easing, RAND corporation, ransomware, Ray Kurzweil, Ross Ulbricht, Ruby on Rails, Satoshi Nakamoto, short selling, Silicon Valley, Silicon Valley ideology, Singularitarianism, slashdot, smart contracts, South Sea Bubble, tulip mania, Turing complete, Turing machine, WikiLeaks

They blamed a rogue employee.139 Bitcoin decentralises things that should not be decentralised, then centralises them anyway but wastefully. Chapter 6: Who is Satoshi Nakamoto? You’ll know sufficient proof has been provided when it actually happens, because cryptographers will be convinced. – Peter Todd, Bitcoin core developer140 The creator of Bitcoin, the pseudonymous “Satoshi Nakamoto,” mined 1.1 million bitcoins over 2009 and 2010. He withdrew from the Bitcoin world and cut off contact completely in 2011. Nobody knows who he really was. Searching for Satoshi Since Nakamoto’s disappearance, there has been endless speculation as to his identity – as whoever was behind “Satoshi” owned 1.1 million bitcoins that haven’t moved since his disappearance. The Wikipedia article on Satoshi Nakamoto even has a section listing people suspected of being him – cypherpunks Hal Finney (who had fallen ill in 2009 and died in 2014) and Nick Szabo, engineer Dorian Nakamoto, mathematician Shinichi Mochizuki … All that is known of Nakamoto is emails and message board posts.141 He even bought and edited bitcoin.org using Tor.

However, he said that he had been speaking of his work on classified systems for military contractors, and that he hadn’t even heard of Bitcoin (which he first called “Bitcom” with an M) until his son had been contacted by a reporter two months earlier. In the first sighting since 2011, the “Satoshi Nakamoto” account that had posted the 2009 announcement of Bitcoin 0.1 on the P2P Foundation forums commented on that post: “I am not Dorian Nakamoto.” (Some noted that the comment could have been posted by a forum administrator and that it was not cryptographically confirmed to be Satoshi Nakamoto.)147 The Bitcoin world was both utterly unconvinced by Newsweek’s report, and outraged that they would violate an alleged Satoshi Nakamoto’s privacy in that manner.148 149 Newsweek defended its article,150 but eventually appended a statement from Dorian Nakamoto to the web version of the original piece in which he denied the whole story and noted the damage it had done to his livelihood.

Wright convinced him he might be Nakamoto by writing emails in his usual style, and then the same content in Nakamoto’s style. Andresen went to London to meet with Wright. Wright cryptographically signed a message as Satoshi Nakamoto on his own computer and verified it. Andresen wanted to check it on his computer, saying he had to be able to say that he’d checked it independently. Wright suddenly balked, not trusting Andresen’s hardware. A new laptop was obtained and unwrapped and Wright installed the Bitcoin Electrum wallet software.175 Wright opened the claimed Satoshi Nakamoto Bitcoin wallet on the new laptop and seemed to verify that he held a Satoshi Nakamoto private key.176 Wright performed a similar demonstration for Jon Matonis from the Bitcoin Foundation.177 None of this evidence was released for public review; Andresen said “I was not allowed to keep the message or laptop (fear it would leak before Official Announcement).”178 The PR team secured the BBC, The Economist and GQ; the journalists signed non-disclosure agreements and embargoes, and in late April Wright demonstrated use of the Satoshi key to each.


pages: 387 words: 112,868

Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money by Nathaniel Popper

4chan, Airbnb, Apple's 1984 Super Bowl advert, banking crisis, Ben Horowitz, bitcoin, blockchain, Burning Man, buy and hold, capital controls, Colonization of Mars, crowdsourcing, cryptocurrency, David Graeber, Edward Snowden, Elon Musk, Extropian, fiat currency, Fractional reserve banking, Jeff Bezos, Julian Assange, Kickstarter, life extension, litecoin, lone genius, M-Pesa, Marc Andreessen, Mark Zuckerberg, Occupy movement, peer-to-peer, peer-to-peer lending, Peter Thiel, Ponzi scheme, price stability, QR code, Ross Ulbricht, Satoshi Nakamoto, Silicon Valley, Simon Singh, Skype, slashdot, smart contracts, Startup school, stealth mode startup, the payments system, transaction costs, tulip mania, WikiLeaks

CHAPTER 3 29Before reaching out to Satoshi, Martti had written about Bitcoin on anti-state.org: Martti’s post, written under the screen name Trickster, is available at https://board.freedomainradio.com/topic/17233-p2p-currency-could-make-the-government-extinct/. 30“The root problem with conventional currency”: Satoshi Nakamoto, “Bitcoin Open Source Implementation of P2P Currency,” P2P Foundation forum, February 11, 2009, http://p2pfoundation.ning.com/forum/topics/bitcoin-open-source. 33It also meant that Satoshi’s computers were still: Sergio Demian Lerner, “The Well Deserved Fortune of Satoshi Nakamoto, Bitcoin Creator, Visionary and Genius,” Bitslog, April 17, 2013, https://bitslog.wordpress .com/2013/04/17/the-well-deserved-fortune-of-satoshi-nakamoto/. 35“Be safe from the unstability caused by fractional reserve”: An archived version of the page designed by Martti is available at http://web.archive .org/web/20090511173000/http://bitcoin.sourceforge.net/. 35A few dozen people downloaded the Bitcoin program: Data on software downloads available at http://sourceforge.net/projects/bitcoin/files/stats/timeline. 37Starting in August, the log of changes to the software: The history of changes to the software is available at https://gitorious.org/bitcoin/bitcoind/activities. 37When the next version of Bitcoin, 0.2: Satoshi Nakamoto to DEV-LIST, December 17, 2009. 37the majority of coins were still: Lerner. 37throughout 2009 no one else was sending or receiving: Data on the number of transactions per block available at https://blockchain.info/charts/n-transactions-per-block. 38In the very first recorded transaction of Bitcoin for United States dollars: Information on the transaction is available at https://blockchain .info/tx/7dff938918f07619abd38e4510890396b1cef4fbeca154fb7aaf ba8843295ea2. 38NewLibertyStandard came up with his own method: The shuttered exchange is still online at http://newlibertystandard.wikifoundry.com/page/Exchange+Rate. 39Swap Variety Shop on his exchange website: The shuttered shop is still online at http://newlibertystandard.wikifoundry.com/page/Specialty+Shop.

: The video of Dorian Nakamoto leaving his house is viewable at http://www.theguardian.com/technology/2014/mar/07/satoshi-nakamoto-denies-inventing-bitcoin. 323“simply be an old man saying ANYTHING”: Gavin’s letter to McGrath Goodman is available at http://www.reddit.com/r/bitcoin/comments/1zqjq6/open_letter_to_leah_mcgrath/. 323In an Amazon review of Danish butter cookies: The review is available at http://www.amazon.com/review/R3U92F9YRUSF37. 323The AP’s story and video from its interview: The interview is viewable at https://www.youtube.com/watch?x-yt-ts=1422579428&x-yt-cl= 85114404&v=GrrtA6IoR_E. 324An Argentinian security expert, Sergio Lerner, had done: Sergio Demian Lerner, “The Well Deserved Fortune of Satoshi Nakamoto, BitcoinCreator, Visionary and Genius,” Bitslog, April 17, 2013, https://bitslog.wordpress.com/2013/04/17/the-well-deserved-fortune-of-satoshi-nakamoto/. 333 “Friends, citizens, Bitcoiners, there is nothing”: Charlie’s speech is viewable at https://www.youtube.com/watch?

On the cover was a dramatic mask, against a black background with the title “BITCOIN’S FACE: THE MYSTERY MAN BEHIND THE CRYPTO-CURRENCY.” Satoshi Nakamoto’s identity had been a recurring fascination for journalists, but all the previous searches had ended with inconclusive results. Given Satoshi’s skill in using anonymizing software, many assumed that Satoshi would never be found until he, she, or they decided to come forward. The Newsweek reporter, Leah McGrath Goodman, had seemingly cracked the nut in the most unexpected way. The man she found was named Dorian Nakamoto, but the papers recording his immigration from Japan to the United States in 1959, at age ten, showed that his name, at birth, had been Satoshi. This Satoshi Nakamoto had gotten a degree in physics from California State Polytechnic University and had worked on classified engineering projects before his retirement.


pages: 457 words: 128,838

The Age of Cryptocurrency: How Bitcoin and Digital Money Are Challenging the Global Economic Order by Paul Vigna, Michael J. Casey

Airbnb, altcoin, bank run, banking crisis, bitcoin, blockchain, Bretton Woods, buy and hold, California gold rush, capital controls, carbon footprint, clean water, collaborative economy, collapse of Lehman Brothers, Columbine, Credit Default Swap, cryptocurrency, David Graeber, disintermediation, Edward Snowden, Elon Musk, Ethereum, ethereum blockchain, fiat currency, financial innovation, Firefox, Flash crash, Fractional reserve banking, hacker house, Hernando de Soto, high net worth, informal economy, intangible asset, Internet of things, inventory management, Joi Ito, Julian Assange, Kickstarter, Kuwabatake Sanjuro: assassination market, litecoin, Long Term Capital Management, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, McMansion, means of production, Menlo Park, mobile money, money: store of value / unit of account / medium of exchange, Nelson Mandela, Network effects, new economy, new new economy, Nixon shock, offshore financial centre, payday loans, Pearl River Delta, peer-to-peer, peer-to-peer lending, pets.com, Ponzi scheme, prediction markets, price stability, profit motive, QR code, RAND corporation, regulatory arbitrage, rent-seeking, reserve currency, Robert Shiller, Robert Shiller, Ross Ulbricht, Satoshi Nakamoto, seigniorage, shareholder value, sharing economy, short selling, Silicon Valley, Silicon Valley startup, Skype, smart contracts, special drawing rights, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, supply-chain management, Ted Nelson, The Great Moderation, the market place, the payments system, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, tulip mania, Turing complete, Tyler Cowen: Great Stagnation, Uber and Lyft, uber lyft, underbanked, WikiLeaks, Y Combinator, Y2K, zero-sum game, Zimmermann PGP

That’s the estimate that cryptographer Sergio Lerner: Sergio Lerner, “The Well Deserved Fortune of Satoshi Nakamoto, Bitcoin Creator, Visionary and Genius,” Words on Bitcoin Design, Privacy, Security and Crypto blog, April 17, 2013, http://bitslog.wordpress.com/2013/04/17/the-well-deserved-fortune-of-satoshi-nakamoto/. SecondMarket’s CEO, Barry Silbert, describes: Comments made at media roundtable sponsored by Circle Internet Financial, New York, December 10, 2013. Nick Szabo, whose writings, the forensics linguists tell us: Paul Vigna, “Bitcoin Creator ‘Satoshi Nakamoto’ Unmasked—Again?,” Wall Street Journal, MoneyBeat blog, April 16, 2014, http://blogs.wsj.com/moneybeat/2014/04/16/bitcoin-creator-satoshi-nakamoto-unmasked-again/. Writing for The New Yorker: Joshua Davis, “The Crypto-Currency: Bitcoin and Its Mysterious Inventor,” New Yorker, October 10, 2011.

Bitcoin takes on the look of a religious movement: the meetups that are reminiscent of church socials, the cultlike crowds that sing bitcoin’s praises on social forums such as Reddit and Twitter, the movement’s evangelists—people such as Barry Silbert, Nicolas Cary, Andreas Antonopoulos, Charlie Shrem, and Roger Ver (whose nickname is Bitcoin Jesus). At the top of it all, ensconced firmly in a creation myth that inspires and nurtures the faithful, is Satoshi Nakamoto, the godhead of bitcoin. But cryptocurrencies could flame out entirely—like the Betamax video format (for those of you old enough to remember it). Or they could have only marginal real-world application, much as the once heavily hyped Segway has had. No less a dedicated bitcoiner than Gavin Andresen, the software engineer whom Satoshi Nakamoto effectively appointed to become the lead developer of bitcoin’s core software, articulates it this way: “Every time I give a talk, I emphasize that bitcoin really is still an experiment; every time I hear about somebody investing their life savings in it, I cringe.”

If we apply the chartalists’ view that money is a social phenomenon, then this ongoing community expansion represents nothing less than a currency’s endeavoring to become money. Two GENESIS What is needed is an electronic payment system based on cryptographic proof instead of trust. —Satoshi Nakamoto October 31, 2008, 2:10 P.M., New York time. The several hundred members of an obscure mailing list comprising cryptography experts and enthusiasts receive an e-mail from somebody calling himself Satoshi Nakamoto.* “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party,” he writes flatly. His brief text directs them to a nine-page white paper posted at a new Web site that he had registered two months earlier, which describes a currency system he calls bitcoin.


pages: 296 words: 86,610

The Bitcoin Guidebook: How to Obtain, Invest, and Spend the World's First Decentralized Cryptocurrency by Ian Demartino

3D printing, AltaVista, altcoin, bitcoin, blockchain, buy low sell high, capital controls, cloud computing, corporate governance, crowdsourcing, cryptocurrency, distributed ledger, Edward Snowden, Elon Musk, Ethereum, ethereum blockchain, fiat currency, Firefox, forensic accounting, global village, GnuPG, Google Earth, Haight Ashbury, Jacob Appelbaum, Kevin Kelly, Kickstarter, litecoin, M-Pesa, Marc Andreessen, Marshall McLuhan, Oculus Rift, peer-to-peer, peer-to-peer lending, Ponzi scheme, prediction markets, QR code, ransomware, Ross Ulbricht, Satoshi Nakamoto, self-driving car, Skype, smart contracts, Steven Levy, the medium is the message, underbanked, WikiLeaks, Zimmermann PGP

The aforementioned Wei Dai was still involved in cryptography after the B-money proposal and so is a prime suspect. There is, of course, the long-held theory that Satoshi Nakamoto is/was Nick Szabo, who wrote publicly about concepts very similar to Bitcoin. There is also David Chaum, who certainly had the necessary experience and perhaps wanted to show the world that electronic cash was viable. Adam Back invented hashcash and commented on the B-money proposal when it was first proposed in the Cypherpunk mailing list, so he can’t be ruled out either. A man named Dorian Prentice Satoshi Nakamoto, who was living in a small house in California, was once “outed” as the real Satoshi Nakamoto by Newsweek in a highly controversial cover story.13 When the article came out, Satoshi Nakamoto’s email came back to life, only to post on the Bitcoin developer mailing list that he was “not Dorian Nakamoto.”

Gox, cofounder of Ripple, and cofounder of Stellar. Satoshi Nakamoto: The anonymous creator of Bitcoin, suspected to be one person or several people. Dread Pirate Roberts: The leader of the infamous Silk Road underground marketplace. May be a group of people or a name passed from person to person. Amir Taaki: Dark Wallet co-creator and lead developer of Darkmarket, later forked to Open Bazaar. Peter Todd: Bitcoin core developer. Ross Ulbricht: Was accused and convicted of being Dread Pirate Roberts; his case is under appeal. Roger Ver: Angel investor and Bitcoin evangelist; CEO of Memorydealers.com, one of the first sites to accept Bitcoin, and founder of the company Blockchain. Cody Wilson: Dark Wallet co-creator and 3D-printed gun designer. Craig Wright: A recent addition to the search for Satoshi Nakamoto. Wired magazine recently reported he was “probably” the creator of Bitcoin (or wanted the world to think he was).

The paper is available at: http://www.bitcoin.org/bitcoin.pdf The main properties: Double-spending is prevented with a peer-to-peer network. No mint or other trusted parties. Participants can be anonymous. New coins are made from Hashcash style proof-of-work. The proof-of-work for new coin generation also powers the network to prevent double-spending. —Satoshi Nakamoto’s announcement of Bitcoin, The Cryptography and Cryptography Policy Mailing List, November 1, 2008 With this message, an anonymous person or group posting under the name Satoshi Nakamoto started the revolution known to the public as Bitcoin. When the Internet first came into the public’s consciousness, people instantly began wondering how Internet commerce would be handled. A lot of people could see the potential of selling goods through the Internet, since—as I noted earlier—systems that enabled home shopping through computer terminals had been around since the 1970s.


pages: 269 words: 79,285

Silk Road by Eileen Ormsby

4chan, bitcoin, blockchain, Brian Krebs, corporate governance, cryptocurrency, Edward Snowden, fiat currency, Firefox, Julian Assange, litecoin, Mark Zuckerberg, Network effects, peer-to-peer, Ponzi scheme, profit motive, Right to Buy, Ross Ulbricht, Satoshi Nakamoto, stealth mode startup, Ted Nelson, trade route, Turing test, web application, WikiLeaks

One person can create as many separate wallets or addresses as they like at the click of a button and transfer bitcoin from one to another almost immediately and without incurring any costs. The cryptocurrency’s life started on 1 November 2008, when a message appeared on a cryptography mailing list from someone calling himself ‘Satoshi Nakamoto’. ‘I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party,’ said his first posting. He linked to a white paper and invited discussion from other cryptographers. Nakamoto took on advice and suggestions until bitcoin was properly unleashed in February 2009, when a modest post appeared on an obscure internet discussion forum, P2P Foundation, by Satoshi Nakamoto (male, 38, Japan): ‘I’ve developed a new open source P2P e-cash system called bitcoin . . . Give it a try.’ He went on to explain that technological advances had made encryption of information available to the average computer user – meaning users no longer had to place their trust in a system administrator who could access their password.

Others believed it to be a pseudonym for a disruptive government or the CIA. As attempts to locate Nakamoto failed, his cult status intensified. Mythology grew of the man who had apparently not made a single mistake – not in the code behind his invention, nor in covering his tracks, despite there being few people in the world who could possibly be him. The mystery spawned an entire industry, with T-shirts emblazoned with ‘Who is Satoshi Nakamoto?’ and ‘I am Satoshi Nakamoto’ selling in worldwide stores dedicated to technology buffs. If Nakamoto were a fictional character he would be the James Bond or Jason Bourne of cyberspace – a genius, an inventor, an outlaw with wealth beyond our imagination. He existed nowhere but in his online musings. He used his rare mathematical genius to create a virtual currency the value of which went from zero to a billion dollars in a couple of years and managed for years to evade every effort to track him down and unmask him.

That the coins had remained untouched sparked another round of conspiracy theories: that he had died, that the coins were held on a corrupted hard drive and could therefore not be recovered, or that he couldn’t cash out without destabilising the currency or revealing his identity. Satoshi Nakamoto was named Business Insider’s most important person of 2013 and was a contender for the title in several other publications, including The Guardian. Journalist Andrew Smith wrote a lengthy piece for the UK’s Sunday Times in late February 2014 about his personal hunt for Satoshi Nakamoto. Smith interviewed the suspects (or at least, those who agreed to speak to him) and found evidence lacking for each. All those who had been ‘unmasked’ by various publications over the years continued to deny they were the pseudonymous creator. Smith put forth yet another name – mathematician David Chaum, founder of the International Association for Cryptologic Research.


pages: 349 words: 102,827

The Infinite Machine: How an Army of Crypto-Hackers Is Building the Next Internet With Ethereum by Camila Russo

4chan, Airbnb, algorithmic trading, altcoin, always be closing, Any sufficiently advanced technology is indistinguishable from magic, Asian financial crisis, bitcoin, blockchain, Burning Man, crowdsourcing, cryptocurrency, distributed ledger, diversification, Donald Trump, East Village, Ethereum, ethereum blockchain, Flash crash, Google Glasses, Google Hangouts, hacker house, Internet of things, Mark Zuckerberg, Maui Hawaii, mobile money, new economy, peer-to-peer, Peter Thiel, pets.com, Ponzi scheme, prediction markets, QR code, reserve currency, RFC: Request For Comment, Richard Stallman, Robert Shiller, Robert Shiller, Sand Hill Road, Satoshi Nakamoto, semantic web, sharing economy, side project, Silicon Valley, Skype, slashdot, smart contracts, South of Market, San Francisco, the payments system, too big to fail, tulip mania, Turing complete, Uber for X

Most of all, he was just frustrated that these internal power struggles were taking away time and energy from work on Ethereum. For Taylor and Mathias, their doubts about Charles only grew. Sometimes Charles seemed to hint that he was Satoshi Nakamoto, the creator of Bitcoin. Satoshi Nakamoto’s identity has been the source of endless speculation, but very few have claimed his identity, knowing they would be met with demands for proof and dogged scrutiny from the crypto community. For someone in crypto, Charles might as well had been saying he was the messiah. It was early March 2014, the day after they had moved in the Zug house, when Newsweek magazine came out with the headline “The Face Behind Bitcoin” splashed across its cover. The reporter on the story claimed Bitcoin’s creator, Satoshi Nakamoto, was a Japanese-American engineer called Dorian S. Nakamoto, who was living in a modest town near Los Angeles. Reporters stood guard in front of his door and a flurry of news articles followed.

But that all died down about twelve hours later when an email account linked to the author of the Bitcoin white paper, aka the real Satoshi Nakamoto, resurfaced for the first time since 2009 with the brief message, “I am not Dorian Nakamoto.” The message was posted on the P2P Foundation’s Ning page, where Satoshi Nakamoto had shared the Bitcoin paper. TechCrunch emailed the foundation’s creator, who verified that the email associated with the account was the same one connected to the 2009 post.1 Back at the Ethereum house, Mathias saw that Charles had opened Satoshi’s message in his laptop and showed it to Richard Wild, one of the designers, with a sly smile on his face and wink in his eye. It may have been an innocent enough act, but to Mathias it was charged with all the hints he had been dropping. There are cryptographic ways to prove whether someone is Satoshi Nakamoto. The Bitcoin creator should have access to the keys that control the first Bitcoins ever mined.

., Advances in Cryptology: Proceedings of CRYPTO 82 (New York : Plenum Press, 1983), http://www.hit.bme.hu/~buttyan/courses/BMEVIHIM219/2009/Chaum.BlindSigForPayment.1982.PDF. 2. Timothy May wrote in the manifesto: Timothy May, “The Crypto Anarchist Manifesto,” November 22, 1992, https://activism.net/cypherpunk/crypto-anarchy.html. 3. “ongoing chain of hash-based proof-of-work”: Satoshi Nakamoto, “Bitcoin P2P E-cash Paper,” Cryptography Mailing List, October 31, 2008, https://satoshi.nakamotoinstitute.org/emails/cryptography/1/#selection-75.18-83.27.18. 4. Satoshi Nakamoto wrote in the paper: Satoshi Nakamoto, “Bitcoin: A Peer-to-Peer Electronic Cash System,” 2008, https://bitcoin.org/bitcoin.pdf. 5. “Bitcoin offers a way to fix this”: Vitalik Buterin, reply to “Bitcoin Weekly Looking for Writers,” BitcoinTalk, March 25, 2011, https://bitcointalk.org/index.php?topic=4916.msg72174#msg72174. 3: The Magazine 1.


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Bitcoin Internals: A Technical Guide to Bitcoin by Chris Clark

bitcoin, fiat currency, peer-to-peer, Satoshi Nakamoto, transaction costs, Turing complete

Recently, ASICs (Application-Specific Integrated Circuits) have been developed that are orders of magnitude faster than GPUs. At this point, miners need to have custom hardware to make mining a profitable investment. Bibliography [1] Satoshi Nakamoto, "Bitcoin: A Peer-to-Peer Electronic Cash System," referenced in e-mail sent to cryptography@metzdowd.com mailing list, October 31, 2008. http://www.mail-archive.com/cryptography@metzdowd.com/msg09959.html [2] "Satoshi Nakamoto," Bitcoin Wiki, June 13, 2013. https://en.bitcoin.it/wiki/Satoshi_Nakamoto#Work [3] "Bitcoin Ladder," Bitcoin Wiki, June 14, 2013. https://en.bitcoin.it/wiki/Bitcoin_Ladder#Top_companies [4] Andy Greenberg, "Black Market Drug Site ’Silk Road’ Booming: $22 Million In Annual Sales," Forbes, August 6, 2012. http://www.forbes.com/sites/andygreenberg/2012/08/06/black-market-drug-site-silk-road-booming-22-million-in-annual-mostly-illegal-sales/ [5] Reuben Grinberg, "Bitcoin: An Innovative Alternative Digital Currency," Hastings Science & Technology Law Journal (4) (2011): 160. http://ssrn.com/abstract=1817857 [6] Ralph Merkle, "A certified digital signature," Proceedings on Advances in cryptology (CRYPTO ’89) (1989): 218-238.

People have an incentive to join the Bitcoin network because those who process transactions are rewarded with newly created bitcoins. Who created Bitcoin? Bitcoin started as a free, open-source computer program written by an author or group of authors who used the pseudonym Satoshi Nakamoto. The pseudonym was used in both the source code3 and in the white paper that describes the idea.[1] Nakamoto’s possible motivations for creating Bitcoin can be gleaned from some of his or her discussions on mailing lists: "[Bitcoin is] very attractive to the libertarian viewpoint if we can explain it properly. I’m better with code than with words though." - Satoshi Nakamoto[8] It is estimated that Nakamoto now owns over $100 million worth of bitcoins, as of May 2013.[9] Nakamoto’s involvement with the Bitcoin project faded in mid-2010, after which the open-source community, headed by Gavin Andresen, took over responsibility for the source code.[2] Why do bitcoins have value?

Bibliography [1] Satoshi Nakamoto, "Bitcoin: A Peer-to-Peer Electronic Cash System," referenced in e-mail sent to cryptography@metzdowd.com mailing list, October 31, 2008. http://www.mail-archive.com/cryptography@metzdowd.com/msg09959.html [2] "Satoshi Nakamoto," Bitcoin Wiki, June 13, 2013. https://en.bitcoin.it/wiki/Satoshi_Nakamoto#Work [3] "Bitcoin Ladder," Bitcoin Wiki, June 14, 2013. https://en.bitcoin.it/wiki/Bitcoin_Ladder#Top_companies [4] Andy Greenberg, "Black Market Drug Site ’Silk Road’ Booming: $22 Million In Annual Sales," Forbes, August 6, 2012. http://www.forbes.com/sites/andygreenberg/2012/08/06/black-market-drug-site-silk-road-booming-22-million-in-annual-mostly-illegal-sales/ [5] Reuben Grinberg, "Bitcoin: An Innovative Alternative Digital Currency," Hastings Science & Technology Law Journal (4) (2011): 160. http://ssrn.com/abstract=1817857 [6] Ralph Merkle, "A certified digital signature," Proceedings on Advances in cryptology (CRYPTO ’89) (1989): 218-238. Originally submitted to CACM, 1979. http://www.merkle.com/papers/Certified1979.pdf [7] Claude Shannon, "Communication Theory of Secrecy Systems," Bell System Technical Journal 28 (4) (1949): 656715. [8] Satoshi Nakamoto, e-mail to cryptography@metzdowd.com mailing list, November 14, 2008. http://www.mail-archive.com/cryptography@metzdowd.com/msg10001.html [9] Adrianne Jeffries, "Four years and $100 million later, Bitcoin’s mysterious creator remains anonymous," The Verge, May 6, 2013. http://www.theverge.com/2013/5/6/4295028/report-satoshi-nakamoto [10] Timothy Lee, "An Illustrated History Of Bitcoin Crashes," Forbes, April 11, 2013. http://www.forbes.com/sites/timothylee/2013/04/11/an-illustrated-history-of-bitcoin-crashes/ [11] Laurie Law, Susan Sabett, Jerry Solinas, "How to make a mint: the cryptography of anonymous electronic cash," National Security Agency, Office of Information Security Research and Technology, Cryptology Division, June 18, 1996. http://groups.csail.mit.edu/mac/classes/6.805/articles/money/nsamint/nsamint.htm [12] David Chaum, "Blind signatures for untraceable payments," Advances in Cryptology Proceedings of Crypto 82 (3) (1983): 199-203


pages: 348 words: 97,277

The Truth Machine: The Blockchain and the Future of Everything by Paul Vigna, Michael J. Casey

3D printing, additive manufacturing, Airbnb, altcoin, Amazon Web Services, barriers to entry, basic income, Berlin Wall, Bernie Madoff, bitcoin, blockchain, blood diamonds, Blythe Masters, business process, buy and hold, carbon footprint, cashless society, cloud computing, computer age, computerized trading, conceptual framework, Credit Default Swap, crowdsourcing, cryptocurrency, cyber-physical system, dematerialisation, disintermediation, distributed ledger, Donald Trump, double entry bookkeeping, Edward Snowden, Elon Musk, Ethereum, ethereum blockchain, failed state, fault tolerance, fiat currency, financial innovation, financial intermediation, global supply chain, Hernando de Soto, hive mind, informal economy, intangible asset, Internet of things, Joi Ito, Kickstarter, linked data, litecoin, longitudinal study, Lyft, M-Pesa, Marc Andreessen, market clearing, mobile money, money: store of value / unit of account / medium of exchange, Network effects, off grid, pets.com, prediction markets, pre–internet, price mechanism, profit maximization, profit motive, ransomware, rent-seeking, RFID, ride hailing / ride sharing, Ross Ulbricht, Satoshi Nakamoto, self-driving car, sharing economy, Silicon Valley, smart contracts, smart meter, Snapchat, social web, software is eating the world, supply-chain management, Ted Nelson, the market place, too big to fail, trade route, transaction costs, Travis Kalanick, Turing complete, Uber and Lyft, uber lyft, unbanked and underbanked, underbanked, universal basic income, web of trust, zero-sum game

The genesis of that subversive idea was, of course, Bitcoin, which, when boiled down to its most basic concept, is founded on the upkeep of a digitized ledger, a record of exchanges and transactions. What makes this ledger so radical, so controversial, is the way in which this record of transactions, known as a blockchain, is created and maintained. Bitcoin, released in 2009 by a person or persons using the pseudonym Satoshi Nakamoto, was designed to be an end-around to the banks and governments that have for centuries been the guardians of our financial systems. Its blockchain promised a new way around processes that had become at best controlled by middlemen who insisted on taking their cut of every transaction, and at worst the cause of some man-made economic disasters. You probably bought this book expecting to read crazy, wild ideas about our digitized future … and here we are, giving you ledgers.

Can a blockchain, which is continuously open to public inspection and guaranteed not by a single bank but by a series of mathematically secured entries into a ledger that’s shared and maintained by many different computers, help us rebuild our lost social capital? The God Protocol On October 31, 2008, while the world was drowning in the financial crisis, a little-noticed “white paper” was released by somebody using the pen name “Satoshi Nakamoto,” and describing something called “Bitcoin,” an electronic version of cash that didn’t need state backing. At the heart of Nakamoto’s electronic cash was a public ledger that could be viewed by anybody but was virtually impossible to alter. This ledger was essentially a digitized, objective rendering of the truth, and in the years to follow it would come to be called the blockchain. Nakamoto combined several elements to come up with his Bitcoin.

Picture a fraud like Bernie Madoff’s, in which Madoff was simply making up transactions and recording them in completely fictitious books, and you can see the value in a system that can verify accounts in real time. Before Grigg, in the 1990s, another visionary had also seen the potential power of a digital ledger. Nick Szabo was an early Cypherpunk* and developed some of the concepts that underlie Bitcoin, which is one reason why some suspect he is Satoshi Nakamoto. His protocol has at its heart a spreadsheet that runs on a “virtual machine”—such as a network of interlinked computers—accessible to multiple parties. Szabo envisioned an intricate system of both private and public data that would protect private identities but provide enough public information about transactions to build up a verifiable transaction history. Szabo’s system—he called it the “God Protocol”—is now more than two decades old.


pages: 273 words: 72,024

Bitcoin for the Befuddled by Conrad Barski

Airbnb, AltaVista, altcoin, bitcoin, blockchain, buttonwood tree, cryptocurrency, Debian, en.wikipedia.org, Ethereum, ethereum blockchain, fiat currency, Isaac Newton, MITM: man-in-the-middle, money: store of value / unit of account / medium of exchange, Network effects, node package manager, p-value, peer-to-peer, price discovery process, QR code, Satoshi Nakamoto, self-driving car, SETI@home, software as a service, the payments system, Yogi Berra

Nobody owns the rules of hockey, and if anybody wants to change the rules, they can do so as long as they don’t mind playing by themselves. It is possible for the rules of hockey to change, but only if everyone agrees to the new rules. Bitcoin is the same way.” (http://www.research.utoronto.ca/what-is-bitcoin/) 3. We actually don’t know whether Satoshi Nakamoto is a man, a woman, or a group of people. 4. Hal Finney developed a reusable proof-of-work system that overlaps significantly with Bitcoin’s proof-of-work used in mining. 5. On March 6, 2014, a user account belonging to Satoshi Nakamoto posted on the P2Pfoundation forum to clarify that he was not Dorian Satoshi Nakamoto, a man who at the time was being harassed by journalists because they mistakenly believed he was the inventor of Bitcoin. 6. These are only rough estimates; the computing power of supercomputers and such projects is often measured in the number of floating-point operations per second (FLOPs).

A trusted central mediator such as PayPal can track payments and money transfers in a privately held account ledger, but it wasn’t clear how a group of strangers who do not trust each other could accomplish the same transactions dependably.4 Sometimes referred to as the Byzantine Generals’ Problem, this fundamental conundrum also emerges in computer science, specifically in how to achieve consensus on a distributed network. In 2008, the problem was elegantly solved by Bitcoin’s inventor, known pseudonymously as Satoshi Nakamoto. Satoshi’s significant breakthrough made it possible for a digital currency to exist without relying on a central authority. Satoshi described the solution to the Byzantine Generals’ Problem and the invention of Bitcoin in a white paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” But the creation of the software that demonstrated the concept in practice was released a year later.

Bitcoin Units As explained in Chapter 1, Bitcoin refers collectively to the entire currency system, whereas bitcoins are the units of the currency. Although the total currency supply is capped at 21 million bitcoins, each one can be subdivided into smaller denominations; for example, 0.1 bitcoins and 0.001 bitcoins. The smallest unit, a hundred millionth of a bitcoin (0.00000001 bitcoins), is called a satoshi in honor of Satoshi Nakamoto. As a result, goods can be priced in Bitcoin very precisely, and people can easily pay for those goods in exact change (e.g., a merchant can price a gallon of milk at 0.00152374 bitcoins, or 152,374 satoshis). Rather than writing the term bitcoins on price tags, merchants commonly use the abbreviated currency code BTC or XBT; 5 bitcoins would be written as 5 BTC. Despite the fact that the BTC abbreviation has been widely used since the beginning of Bitcoin’s development, more recently some merchants and websites have started using XBT because it conforms better to certain international naming standards.1 As bitcoins have appreciated in value, it has become increasingly common to work with thousandths or even millionths of bitcoins, which are called millibitcoins (mBTC) and microbitcoins (μBTC), respectively.


pages: 515 words: 126,820

Blockchain Revolution: How the Technology Behind Bitcoin Is Changing Money, Business, and the World by Don Tapscott, Alex Tapscott

Airbnb, altcoin, asset-backed security, autonomous vehicles, barriers to entry, bitcoin, blockchain, Blythe Masters, Bretton Woods, business process, buy and hold, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, clean water, cloud computing, cognitive dissonance, commoditize, corporate governance, corporate social responsibility, creative destruction, Credit Default Swap, crowdsourcing, cryptocurrency, disintermediation, disruptive innovation, distributed ledger, Donald Trump, double entry bookkeeping, Edward Snowden, Elon Musk, Erik Brynjolfsson, Ethereum, ethereum blockchain, failed state, fiat currency, financial innovation, Firefox, first square of the chessboard, first square of the chessboard / second half of the chessboard, future of work, Galaxy Zoo, George Gilder, glass ceiling, Google bus, Hernando de Soto, income inequality, informal economy, information asymmetry, intangible asset, interest rate swap, Internet of things, Jeff Bezos, jimmy wales, Kickstarter, knowledge worker, Kodak vs Instagram, Lean Startup, litecoin, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, Marshall McLuhan, means of production, microcredit, mobile money, money market fund, Network effects, new economy, Oculus Rift, off grid, pattern recognition, peer-to-peer, peer-to-peer lending, peer-to-peer model, performance metric, Peter Thiel, planetary scale, Ponzi scheme, prediction markets, price mechanism, Productivity paradox, QR code, quantitative easing, ransomware, Ray Kurzweil, renewable energy credits, rent-seeking, ride hailing / ride sharing, Ronald Coase, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, seigniorage, self-driving car, sharing economy, Silicon Valley, Skype, smart contracts, smart grid, social graph, social intelligence, social software, standardized shipping container, Stephen Hawking, Steve Jobs, Steve Wozniak, Stewart Brand, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, The Wisdom of Crowds, transaction costs, Turing complete, Turing test, Uber and Lyft, uber lyft, unbanked and underbanked, underbanked, unorthodox policies, wealth creators, X Prize, Y2K, Zipcar

Imagine a technology that could preserve our freedom to choose for ourselves and our families, to express these choices in the world, and to control our own destiny, no matter where we lived or were born. What new tools and new jobs could we create with those capabilities? What new businesses and services? How should we think about the opportunities? The answers were right in front of us, compliments of Satoshi Nakamoto. THE SEVEN DESIGN PRINCIPLES We believe that this next era could be inspired by Satoshi Nakamoto’s vision, designed around a set of implicit principles, and realized by the collaborative spirit of many passionate and equally talented leaders in the community. His grand vision was limited to money, not to some greater goal of creating a second generation of the Internet. There was no discussion of reinventing the firm, changing our institutions, or transforming civilization for the better.

God being the ultimate in confessional discretion, no party would learn anything more about the other parties’ inputs than they could learn from their own inputs and the output.”4 His point was powerful: Doing business on the Internet requires a leap of faith. Because the infrastructure lacks the much-needed security, we often have little choice but to treat the middlemen as if they were deities. A decade later in 2008, the global financial industry crashed. Perhaps propitiously, a pseudonymous person or persons named Satoshi Nakamoto outlined a new protocol for a peer-to-peer electronic cash system using a cryptocurrency called bitcoin. Cryptocurrencies (digital currencies) are different from traditional fiat currencies because they are not created or controlled by countries. This protocol established a set of rules—in the form of distributed computations—that ensured the integrity of the data exchanged among these billions of devices without going through a trusted third party.

We believe the advent of a decentralized world-wide ledger coupled with powerful encryption to mask the identities of buyer and seller will be attractive to the art world.”28 The artist becomes what could be called a “rights monetizer” with the technology making deals and collecting revenue in real time. You could apply this same model to other fields as well. In science, a researcher could publish a paper to a limited audience of peers, as Satoshi Nakamoto did, and receive reviews and the credibility to publish to a larger audience, rather than assigning all rights to a scientific journal. The paper might even be available for free but other scientists could subscribe to a deeper analysis or threaded discussions with the author about it. She could make her raw data available or perhaps share data with other scientists as part of a smart contract.


pages: 416 words: 106,532

Cryptoassets: The Innovative Investor's Guide to Bitcoin and Beyond: The Innovative Investor's Guide to Bitcoin and Beyond by Chris Burniske, Jack Tatar

Airbnb, altcoin, asset allocation, asset-backed security, autonomous vehicles, bitcoin, blockchain, Blythe Masters, business cycle, business process, buy and hold, capital controls, Carmen Reinhart, Clayton Christensen, clean water, cloud computing, collateralized debt obligation, commoditize, correlation coefficient, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, disintermediation, distributed ledger, diversification, diversified portfolio, Donald Trump, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, fiat currency, financial innovation, fixed income, George Gilder, Google Hangouts, high net worth, Jeff Bezos, Kenneth Rogoff, Kickstarter, Leonard Kleinrock, litecoin, Marc Andreessen, Mark Zuckerberg, market bubble, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, Network effects, packet switching, passive investing, peer-to-peer, peer-to-peer lending, Peter Thiel, pets.com, Ponzi scheme, prediction markets, quantitative easing, RAND corporation, random walk, Renaissance Technologies, risk tolerance, risk-adjusted returns, Robert Shiller, Robert Shiller, Ross Ulbricht, Satoshi Nakamoto, Sharpe ratio, Silicon Valley, Simon Singh, Skype, smart contracts, social web, South Sea Bubble, Steve Jobs, transaction costs, tulip mania, Turing complete, Uber for X, Vanguard fund, WikiLeaks, Y2K

Chapter 1 1. https://www.stlouisfed.org/financial-crisis/full-timeline; http://historyofbitcoin.org/. 2. http://www.gao.gov/assets/660/651322.pdf. 3. http://wayback.archive.org/web/20120529203623/http://p2pfoundation.ning.com/profile/SatoshiNakamoto. 4. http://observer.com/2011/10/did-the-new-yorkers-joshua-davis-nail-the-identity-of-bitcoin-creator-satoshi-nakamoto/. 5. https://en.wikipedia.org/wiki/Satoshi_Nakamoto#cite_note-betabeat-12. 6. http://www.economist.com/news/business-and-finance/21698060-craig-wright-reveals-himself-as-satoshi-nakamoto. 7. https://www.wired.com/2016/05/craig-wright-privately-proved-hes-bitcoins-creator/. 8. http://www.economist.com/news/finance-and-economics/21698294-quest-find-satoshi-nakamoto-continues-wrightu2019s-wrongs. 9. http://www.nytimes.com/2008/03/17/business/17bear.html?_r=0. 10. https://www.federalreserve.gov/newsevents/reform_bearstearns.htm. 11. http://www.wsj.com/articles/SB123051066413538349. 12.

In the four months of August to October 2008, an unprecedented series of changes occurred: Bitcoin.org was registered, Lehman Brothers filed for the largest bankruptcy in American history, Bank of America bought Merrill Lynch for $50 billion, the U.S. government established the $700 billion Troubled Asset Relief Program (TARP), and Satoshi Nakamoto published a paper that founded Bitcoin and the basis of blockchain technology.1 The entwinement of the financial collapse on the one hand and the rise of Bitcoin on the other is hard to ignore. The financial crisis cost the global economy trillions of dollars and burned bridges of trust between financial titans and the public.2 Meanwhile, Bitcoin provided a system of decentralized trust for value transfer, relying not on the ethics of humankind but on the cold calculation of computers and laying the foundation potentially to obviate the need for much of Wall Street. WHO IS SATOSHI NAKAMOTO? Referring to Satoshi as “he” is simply a matter of convenience because to this day no one knows exactly who or even what Satoshi is.

Furthermore, as these CMOs were spread around the world, global investors were suddenly interconnected in a web of American mortgages.12 In the summer of 2008, despite the lack of financial transparency but emboldened by access to funds from the Federal Reserve in case of further distress, Richard Fuld Jr., the CEO of Lehman Brothers, eerily claimed, “We can’t fail now.”13 As a storm brewed around unknowing Wall Street executives, Satoshi Nakamoto was busy fleshing out the concept of Bitcoin. On August 18, 2008, Bitcoin.org, the home website for information on Bitcoin, was registered.14 Whether as an individual or an entity, what’s now clear is that Satoshi was designing a technology that if existent would have likely ameliorated the toxic opacity of CMOs. Due to the distributed transparency and immutable audit log of a blockchain, each loan issued and packaged into different CMOs could have been documented on a single blockchain.


pages: 571 words: 106,255

The Bitcoin Standard: The Decentralized Alternative to Central Banking by Saifedean Ammous

Airbnb, altcoin, bank run, banks create money, bitcoin, Black Swan, blockchain, Bretton Woods, British Empire, business cycle, capital controls, central bank independence, conceptual framework, creative destruction, cryptocurrency, currency manipulation / currency intervention, currency peg, delayed gratification, disintermediation, distributed ledger, Ethereum, ethereum blockchain, fiat currency, fixed income, floating exchange rates, Fractional reserve banking, full employment, George Gilder, global reserve currency, high net worth, invention of the telegraph, Isaac Newton, iterative process, jimmy wales, Joseph Schumpeter, market bubble, market clearing, means of production, money: store of value / unit of account / medium of exchange, moral hazard, Network effects, Paul Samuelson, peer-to-peer, Peter Thiel, price mechanism, price stability, profit motive, QR code, ransomware, reserve currency, Richard Feynman, risk tolerance, Satoshi Nakamoto, secular stagnation, smart contracts, special drawing rights, Stanford marshmallow experiment, The Nature of the Firm, the payments system, too big to fail, transaction costs, Walter Mischel, zero-sum game

Should you come out of reading this book thinking that the bitcoin currency is something worth owning, your first investment should not be in buying bitcoins, but in time spent understanding how to buy, store, and own bitcoins securely. It is the inherent nature of Bitcoin that such knowledge cannot be delegated or outsourced. There is no alternative to personal responsibility for anyone interested in using this network, and that is the real investment that needs to be made to get into Bitcoin. Notes 1 The full email can be found on the Satoshi Nakamoto Institute archive of all known Satoshi Nakamoto writings, available at www.nakamotoinstitute.org 2 The now‐defunct New Liberty Standard. 3 Nathaniel Popper, Digital Gold (Harper, 2015). 4 In other words, in the eight years it has been a market commodity, a bitcoin has appreciated around almost eight million‐fold, or, precisely 793,513,944% from its first price of $0.000994 to its all‐time high at the time of writing, $7,888.

For more information about Wiley products, visit www.wiley.com. Library of Congress Cataloging‐in‐Publication Data is Available: ISBN 9781119473862 (Hardcover) ISBN 9781119473893 (ePDF) ISBN 9781119473916 (ePub) Cover Design: Wiley Cover Images: REI stone © Danita Delimont/Getty Images; gold bars © Grassetto/Getty Images; QR code/Courtesy of Saifedean Ammous To my wife and daughter, who give me a reason to write. And to Satoshi Nakamoto, who gave me something worth writing about. About the Author Saifedean Ammous is a Professor of Economics at the Lebanese American University and member of the Center on Capitalism and Society at Columbia University. He holds a PhD in Sustainable Development from Columbia University. Foreword by Nassim Nicholas Taleb Let us follow the logic of things from the beginning. Or, rather, from the end: modern times.

But it is the first organic currency. But its mere existence is an insurance policy that will remind governments that the last object the establishment could control, namely, the currency, is no longer their monopoly. This gives us, the crowd, an insurance policy against an Orwellian future. Nassim Nicholas Taleb January 22, 2018 Prologue On November 1, 2008, a computer programmer going by the pseudonym Satoshi Nakamoto sent an email to a cryptography mailing list to announce that he had produced a “new electronic cash system that's fully peer‐to‐peer, with no trusted third party.”1 He copied the abstract of the paper explaining the design, and a link to it online. In essence, Bitcoin offered a payment network with its own native currency, and used a sophisticated method for members to verify all transactions without having to trust in any single member of the network.


pages: 161 words: 44,488

The Business Blockchain: Promise, Practice, and Application of the Next Internet Technology by William Mougayar

Airbnb, airport security, Albert Einstein, altcoin, Amazon Web Services, bitcoin, Black Swan, blockchain, business process, centralized clearinghouse, Clayton Christensen, cloud computing, cryptocurrency, disintermediation, distributed ledger, Edward Snowden, en.wikipedia.org, Ethereum, ethereum blockchain, fault tolerance, fiat currency, fixed income, global value chain, Innovator's Dilemma, Internet of things, Kevin Kelly, Kickstarter, market clearing, Network effects, new economy, peer-to-peer, peer-to-peer lending, prediction markets, pull request, QR code, ride hailing / ride sharing, Satoshi Nakamoto, sharing economy, smart contracts, social web, software as a service, too big to fail, Turing complete, web application

Although cryptographers, mathematicians and coders have been working on increasingly specific and advanced protocols in order to get stronger and stronger privacy and authenticity guarantees out of various systems—from electronic cash to voting to file transfer—progress was slow for over 30 years. The innovation of the blockchain—or, more generally, the innovation of public economic consensus by Satoshi Nakamoto in 2009—proved to be the one missing piece of the puzzle that single-handedly gave the industry its next giant leap forward. The political environment seemed to almost snap into place: the great financial crisis in 2008 spurred growing distrust in mainstream finance, including both corporations and the governments that are normally supposed to regulate them, and was the initial spark that drove many to seek out alternatives.

Block by block, we will accumulate our own chains of knowledge, and we will learn and understand the blockchain, what it changes, and the implications of such change. Today, we google for everything, mostly information or products. Tomorrow, we will perform the equivalent of “googling” to verify records, identities, authenticity, rights, work done, titles, contracts, and other valuable asset-related processes. There will be digital ownership certificates for everything. Just like we cannot double spend digital money anymore (thanks to Satoshi Nakamoto's invention), we will not be able to double copy or forge official certificates once they are certified on a blockchain. That was a missing piece of the information revolution, which the blockchain fixes. I still remember the initial excitement around being able to track a shipped package on the Web when FedEx introduced this capability for the first time in 1994. Today, we take that type of service for granted, but this particular feature was a watershed use case that demonstrated what we could do on the early Web.

SOFTWARE, GAME THEORY AND CRYPTOGRAPHY Another way to understand the blockchain is in seeing it as a triad of combustion of the known fields of 1) game theory, 2) cryptography science, and 3) software engineering. Separately, these fields have existed for a long time, but for the first time, they have together intersected harmoniously and morphed inside blockchain technology. Game theory is ‘the study of mathematical models of conflict and cooperation between intelligent rational decision-makers.”4 And this is related to the blockchain because the Bitcoin blockchain, originally conceived by Satoshi Nakamoto, had to solve a known game theory conundrum called the Byzantine Generals Problem.5 Solving that problem consists in mitigating any attempts by a small number of unethical Generals who would otherwise become traitors, and lie about coordinating their attack to guarantee victory. This is accomplished by enforcing a process for verifying the work that was put into crafting these messages, and time-limiting the requirement for seeing untampered messages in order to ensure their validity.


pages: 209 words: 53,236

The Scandal of Money by George Gilder

Affordable Care Act / Obamacare, bank run, Bernie Sanders, bitcoin, blockchain, borderless world, Bretton Woods, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, Claude Shannon: information theory, Clayton Christensen, cloud computing, corporate governance, cryptocurrency, currency manipulation / currency intervention, Daniel Kahneman / Amos Tversky, Deng Xiaoping, disintermediation, Donald Trump, fiat currency, financial innovation, Fractional reserve banking, full employment, George Gilder, glass ceiling, Home mortgage interest deduction, index fund, indoor plumbing, industrial robot, inflation targeting, informal economy, Innovator's Dilemma, Internet of things, invisible hand, Isaac Newton, Jeff Bezos, John von Neumann, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, Law of Accelerating Returns, Marc Andreessen, Mark Zuckerberg, Menlo Park, Metcalfe’s law, money: store of value / unit of account / medium of exchange, mortgage tax deduction, obamacare, Paul Samuelson, Peter Thiel, Ponzi scheme, price stability, Productivity paradox, purchasing power parity, quantitative easing, quantitative trading / quantitative finance, Ray Kurzweil, reserve currency, road to serfdom, Robert Gordon, Robert Metcalfe, Ronald Reagan, Sand Hill Road, Satoshi Nakamoto, Search for Extraterrestrial Intelligence, secular stagnation, seigniorage, Silicon Valley, smart grid, South China Sea, special drawing rights, The Great Moderation, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, Tim Cook: Apple, time value of money, too big to fail, transaction costs, trickle-down economics, Turing machine, winner-take-all economy, yield curve, zero-sum game

Information theory operates on the epistemic plane where human beings conduct falsifiable experiments that yield learning and accumulate knowledge. The lesson of information theory is that irreversible money cannot be the measure of itself, defined by the values it gauges. It is part of a logical system, and like all such systems it must be based on values outside itself. It must be rooted in the entropy of irreversible time. When the bitcoin innovators Satoshi Nakamoto and Nick Szabo sought to invent new forms of money, they explicitly designed algorithms that nullified the effects of technological advance in computer technology. As Moore’s Law improves the computer systems used to validate transactions and integrate them with the bitcoin blockchain, for example, the “proof of work” challenge in the algorithm becomes proportionately more difficult and the reward smaller.

With no personal information transferred—but all such information preserved—there is no need to restrict the transaction to protected networks, encrypted “Swift” banking transfer lines, or ATM networks. Wi-Fi or Bluetooth or your cellphone link suffices. Names and passwords and other authentication details do not need to be stored. An effort to hack one of the computers and change the blockchain ledger would be pointless, as the correct ledger would exist on myriad other computers. Gold, however, remains the leading player. In fact, bitcoin’s mysterious, pseudonymous founder, one “Satoshi Nakamoto,” specifically mimicked gold in developing his digital money, which becomes more difficult to “mine” with the passage of time. Its value, like gold’s, is ultimately based on its scarcity. It is not a competitor with gold but an Internet money that simulates the properties of the monetary metal and offers a path toward a gold-inspired standard for the net. Understanding any kind of money still requires coming to terms with the meaning of gold.

A shrewd analyst and historian of the evolution of money, Szabo in the 1990s threw a wrench into the Drexlerian nanotech movement, with its dream of building new molecules from scratch using nano-replicators, offering a prize to anyone who could create a macro-replicator out of Lego blocks or other toy-like potential replicators. If you can’t build a macro-replicator, you probably cannot build one with nano-pincers and electron microscopes.4 There was no one to claim the prize. Since then Szabo has been focusing on the easier enigmas of money and gold. Though he denies it, Szabo has long been suspected of being Satoshi Nakamoto, and several analyses have shown his prose above all others to conform to the idiosyncrasies of Nakamoto’s bitcoin paper. Known in the early 1990s for his canny ruminations on strategies for network anonymity and pseudonymity, Szabo now writes a pithy, original, and very occasional blog on money matters called Unenumerated5 but is otherwise scarcely or skittishly represented on the Internet.


pages: 611 words: 130,419

Narrative Economics: How Stories Go Viral and Drive Major Economic Events by Robert J. Shiller

agricultural Revolution, Albert Einstein, algorithmic trading, Andrei Shleifer, autonomous vehicles, bank run, banking crisis, basic income, bitcoin, blockchain, business cycle, butterfly effect, buy and hold, Capital in the Twenty-First Century by Thomas Piketty, Cass Sunstein, central bank independence, collective bargaining, computerized trading, corporate raider, correlation does not imply causation, cryptocurrency, Daniel Kahneman / Amos Tversky, debt deflation, disintermediation, Donald Trump, Edmond Halley, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, full employment, George Akerlof, germ theory of disease, German hyperinflation, Gunnar Myrdal, Gödel, Escher, Bach, Hacker Ethic, implied volatility, income inequality, inflation targeting, invention of radio, invention of the telegraph, Jean Tirole, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, litecoin, market bubble, money market fund, moral hazard, Northern Rock, nudge unit, Own Your Own Home, Paul Samuelson, Philip Mirowski, plutocrats, Plutocrats, Ponzi scheme, publish or perish, random walk, Richard Thaler, Robert Shiller, Robert Shiller, Ronald Reagan, Rubik’s Cube, Satoshi Nakamoto, secular stagnation, shareholder value, Silicon Valley, speech recognition, Steve Jobs, Steven Pinker, stochastic process, stocks for the long run, superstar cities, The Rise and Fall of American Growth, The Wealth of Nations by Adam Smith, theory of mind, Thorstein Veblen, traveling salesman, trickle-down economics, tulip mania, universal basic income, Watson beat the top human players on Jeopardy!, We are the 99%, yellow journalism, yield curve, Yom Kippur War

The Merkle tree and the digital signature algorithm are essential elements of the Bitcoin protocol described in the original Bitcoin paper signed by Satoshi Nakamoto in 2008. The equilibrium of the congestion queuing game is described in Huberman et al., 2017. 4. Proudhon 1923 [1840], p. 293. 5. Sterlin Lujan, “Bitcoin Was Built to Incite Peaceful Anarchy,” https://news.bitcoin.com/bitcoin-built-incite-peaceful-anarchy/. Passage is dated January 9, 2016. 6. Ross, 1991, p. 116. 7. Himanen, 2001. 8. Zoë Bernard, “Satoshi Nakamoto was weird, paranoid, and bossy, says early Bitcoin developer who exchanged hundreds of emails with the mysterious crypto creator,” Business Insider, May 30, 2018, http://www.businessinsider.com/satoshi-nakamoto-was-weird-and-bossy-says-bitcoin-developer-2018-5. Chapter 2. An Adventure in Consilience 1. For example, calls for a broader approach to economic research have asked for the study of “social dynamics” and “popular models” (Shiller, 1984), “culturomics” (Michel et al., 2011), or “humanomics” (McCloskey, 2016); or for more “narrativeness” (Morson and Schapiro, 2017) or for “fictional expectations” (Beckert and Bronk, 2018) or “diagnostic expectations” (Gennaioli and Shleifer, 2018), “policy legends and folklists” (Fine and O’Neill, 2010), or “information-processing difficulty” in responding to news that makes “changes in expectations” into “an independent driver of economic fluctuations” (Beaudry and Portier, 2014). 2.

Equally appealing, the narrative generates stories of untold riches. Bitcoin as a Human-Interest Narrative The Bitcoin narrative is a motivating narrative for the cosmopolitan class around the world, for people who aspire to join that class, and for those who identify with advanced technology. And like many economic narratives, Bitcoin has its celebrity hero, Satoshi Nakamoto, who is a central human-interest story for Bitcoin. Adding to the romance of the Bitcoin narrative is a mystery story, for Satoshi Nakamoto has never been seen by anyone who will testify to having seen him. One early Bitcoin codeveloper said that Satoshi communicated only by email and that the two had never met in person.8 On its website, Bitcoin.org says only, “Satoshi left the project in late 2010 without revealing much about himself.” People love mystery stories and love to unravel the mystery, so much so that there is a rich genre of mystery literature.

Bitcoin surprised when it was first announced, and then it surprised again and again as the world’s attention continued to grow by leaps and bounds. At one point, the total value of Bitcoin exceeded US $300 billion. But Bitcoin has no value unless people think it has value, as its proponents readily admit. How did Bitcoin’s value go from $0 to $300 billion in just a few years? The beginnings of Bitcoin date to 2008, when a paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System,” signed by Satoshi Nakamoto, was distributed to a mailing list. In 2009, the first cryptocurrency, called Bitcoin, was launched based on ideas in that paper. Cryptocurrencies are computer-managed public ledger entries that can function as money, so long as people value these entries as money and use them for purchases and sales. There is an impressive mathematical theory underlying cryptocurrencies, but the theory does not identify what might cause people to value them or to believe that other people will also think they have value.


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The Evolution of Everything: How New Ideas Emerge by Matt Ridley

"Robert Solow", affirmative action, Affordable Care Act / Obamacare, Albert Einstein, Alfred Russel Wallace, AltaVista, altcoin, anthropic principle, anti-communist, bank run, banking crisis, barriers to entry, bitcoin, blockchain, Boris Johnson, British Empire, Broken windows theory, Columbian Exchange, computer age, Corn Laws, cosmological constant, creative destruction, Credit Default Swap, crony capitalism, crowdsourcing, cryptocurrency, David Ricardo: comparative advantage, demographic transition, Deng Xiaoping, discovery of DNA, Donald Davies, double helix, Downton Abbey, Edward Glaeser, Edward Lorenz: Chaos theory, Edward Snowden, endogenous growth, epigenetics, Ethereum, ethereum blockchain, facts on the ground, falling living standards, Ferguson, Missouri, financial deregulation, financial innovation, Frederick Winslow Taylor, Geoffrey West, Santa Fe Institute, George Gilder, George Santayana, Gunnar Myrdal, Henri Poincaré, hydraulic fracturing, imperial preference, income per capita, indoor plumbing, interchangeable parts, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Isaac Newton, Jane Jacobs, Jeff Bezos, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kevin Kelly, Khan Academy, knowledge economy, land reform, Lao Tzu, long peace, Lyft, M-Pesa, Mahatma Gandhi, Mark Zuckerberg, means of production, meta analysis, meta-analysis, mobile money, money: store of value / unit of account / medium of exchange, Mont Pelerin Society, moral hazard, Necker cube, obamacare, out of africa, packet switching, peer-to-peer, phenotype, Pierre-Simon Laplace, price mechanism, profit motive, RAND corporation, random walk, Ray Kurzweil, rent-seeking, reserve currency, Richard Feynman, rising living standards, road to serfdom, Ronald Coase, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, sharing economy, smart contracts, South Sea Bubble, Steve Jobs, Steven Pinker, The Wealth of Nations by Adam Smith, Thorstein Veblen, transaction costs, twin studies, uber lyft, women in the workforce

Forensic analysis of his style, his idiosyncrasies, his likely age and the pattern of his activity has led the author Dominic Frisby and others – including a team of forty forensic linguists from Birmingham University – to the conclusion that Satoshi Nakamoto is probably Nick Szabo. Suspiciously, the normally prolific Szabo went unusually silent around the time Satoshi Nakamoto became active, and vice versa. However, Szabo has denied on Twitter that he is Satoshi. (Some still think that he and Hal Finney collaborated as Satoshi, giving each deniability.) Szabo himself keeps a low profile. No photograph of him can be found on the net. Whoever he is, ‘Satoshi Nakamoto’ knows a lot about computer programming and economic history – a rare combination. There is little doubt that bitcoin is one of the most significant inventions of our lifetime (though I doubt it would have remained uninvented if Satoshi had not existed: someone else would have come up with some form of self-verifying currency).

Then there was e-gold, a digital payments system run from the Caribbean by an oncologist called Doug Jackson that rocketed to $1.5 billion in transactions before being shut down on the grounds that it was allowing illegal money transmission. Governments do not take kindly to money that is outside their control. Hence the shyness of bitcoin’s founder. The mysterious founder Who is Satoshi Nakamoto? Newsweek magazine thought it had found him in March 2014 when it identified a sixty-four-year-old Japanese-American programmer named Dorian Satoshi Nakamoto living near Los Angeles. The baffled and beleaguered Dorian, an unemployed man in poor health with a clumsy command of English, protested that he had nothing to do with bitcoin, did not understand what it was, and thought it was called ‘bitcom’. And, he asked pertinently, why would he use part of his real name if he wanted to stay anonymous?

By the 2000s he was musing about something called bitgold, an imaginary software product that would mimic the properties of gold: it would be scarce and hard to acquire, but easy for others to verify, and thus could be trusted as a store of value. Clearly, he was trying to think how to recreate online the key steps in the evolution of real money. Some years went by. Then, on 18 August 2008, a month before the financial crisis broke in earnest, a new domain name was registered anonymously: bitcoin.org. Two weeks later, somebody with the user name ‘Satoshi Nakamoto’ posted a nine-page paper outlining an idea for a peer-to-peer electronic cash system called bitcoin. The bitcoin system went live a few months later, on the day the British government reported its second bailout of the banks, an event referred to by Satoshi, who quoted a headline from The Times in his announcement of bitcoin’s birth. A month later Satoshi announced on the Peer-to-Peer Foundation website: ‘I’ve developed a new open source P2P e-cash system called Bitcoin.


pages: 472 words: 117,093

Machine, Platform, Crowd: Harnessing Our Digital Future by Andrew McAfee, Erik Brynjolfsson

"Robert Solow", 3D printing, additive manufacturing, AI winter, Airbnb, airline deregulation, airport security, Albert Einstein, Amazon Mechanical Turk, Amazon Web Services, artificial general intelligence, augmented reality, autonomous vehicles, backtesting, barriers to entry, bitcoin, blockchain, British Empire, business cycle, business process, carbon footprint, Cass Sunstein, centralized clearinghouse, Chris Urmson, cloud computing, cognitive bias, commoditize, complexity theory, computer age, creative destruction, crony capitalism, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, Dean Kamen, discovery of DNA, disintermediation, disruptive innovation, distributed ledger, double helix, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Ethereum, ethereum blockchain, everywhere but in the productivity statistics, family office, fiat currency, financial innovation, George Akerlof, global supply chain, Hernando de Soto, hive mind, information asymmetry, Internet of things, inventory management, iterative process, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, joint-stock company, Joseph Schumpeter, Kickstarter, law of one price, longitudinal study, Lyft, Machine translation of "The spirit is willing, but the flesh is weak." to Russian and back, Marc Andreessen, Mark Zuckerberg, meta analysis, meta-analysis, Mitch Kapor, moral hazard, multi-sided market, Myron Scholes, natural language processing, Network effects, new economy, Norbert Wiener, Oculus Rift, PageRank, pattern recognition, peer-to-peer lending, performance metric, plutocrats, Plutocrats, precision agriculture, prediction markets, pre–internet, price stability, principal–agent problem, Ray Kurzweil, Renaissance Technologies, Richard Stallman, ride hailing / ride sharing, risk tolerance, Ronald Coase, Satoshi Nakamoto, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Skype, slashdot, smart contracts, Snapchat, speech recognition, statistical model, Steve Ballmer, Steve Jobs, Steven Pinker, supply-chain management, TaskRabbit, Ted Nelson, The Market for Lemons, The Nature of the Firm, Thomas Davenport, Thomas L Friedman, too big to fail, transaction costs, transportation-network company, traveling salesman, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, ubercab, Watson beat the top human players on Jeopardy!, winner-take-all economy, yield management, zero day

Keynes saw that the ideas of prominent “worldly philosophers”* like Adam Smith, Karl Marx, David Ricardo, Friedrich Hayek, and Joseph Schumpeter reach far outside the discipline of economics. They change how people think about fairness and justice, how companies organize themselves and innovate, how governments approach taxation and trade, and so on. Economists think about exchange, a fundamental and universal human activity, so their biggest ideas on the subject have had a huge impact. Bitcoin: The Pseudonymous Revolution Satoshi Nakamoto’s ideas have also had a huge impact, even though nobody knows who he or she is.† On October 31, 2008, a person or group going by that name posted online a short paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” It addressed a straightforward question: Why do online payments have to involve banks, credit card companies, and other financial intermediaries? Why can’t they be like cash payments in the physical world?

Even though the 7,500 Bitcoins on the hard drive were at that time worth about $7.5 million, Howells did not mount a search for it. The miners and others who built the Bitcoin network were behaving just as Keynes had predicted, but with some fascinating twists. They weren’t madmen, and most of them weren’t in authority, but they were still “distilling their frenzy” not from some academic scribbler, but instead from a pseudonymous one: Satoshi Nakamoto. The Ledger, Not the Currency: Waking Up to the Blockchain’s Potential Throughout this time, most mainstream economists were skeptical, even dismissive, of Bitcoin’s potential as a rival to the world’s established currencies. Two of the main functions of any money, they pointed out, were a means of exchange (I give you these dollars or euros or yen and you give me that house or car or chicken dinner) and a store of value (my total net worth is X dollars, euros, or yen; with this amount of wealth I can buy so many houses, cars, or chicken dinners).

. §§ The parties involved in a blockchain transaction can decide to include a transaction fee, which will be awarded to the miner that creates the block. These voluntary fees are intended as an additional incentive to miners. ¶¶ Settlement risk is the possibility that one side of the transaction might not deliver the shares as promised once the other party has paid for them, or vice versa. ## Many believe that Szabo is, in fact, Satoshi Nakamoto. He has repeatedly denied this claim. *** Our literary agent is the eminently trustworthy Raphael Sagalyn. ††† There were fewer signals to Norton that the two of us would be good authors for them to work with. We’re grateful that they took a chance on us. ‡‡‡ If we were worried that Norton might not have enough money to pay us, we could include an escrow account or other contingency within the smart contract.


pages: 304 words: 91,566

Bitcoin Billionaires: A True Story of Genius, Betrayal, and Redemption by Ben Mezrich

"side hustle", airport security, Albert Einstein, bank run, Ben Horowitz, bitcoin, blockchain, Burning Man, buttonwood tree, cryptocurrency, East Village, El Camino Real, Elon Musk, family office, fault tolerance, fiat currency, financial innovation, game design, Isaac Newton, Marc Andreessen, Mark Zuckerberg, Menlo Park, Metcalfe’s law, new economy, offshore financial centre, paypal mafia, peer-to-peer, Peter Thiel, Ponzi scheme, QR code, Ronald Reagan, Ross Ulbricht, Sand Hill Road, Satoshi Nakamoto, Schrödinger's Cat, self-driving car, side project, Silicon Valley, Skype, smart contracts, South of Market, San Francisco, Steve Jobs, transaction costs, zero-sum game

His newest adventure had begun almost three years earlier, while he was still a college senior. After an uneventful day spent commenting on a variety of hacking forums, Charlie had suddenly seen a strange little email that had been sent out to a cryptography mailing list. The email had come from someone named Satoshi Nakamoto. In the email, Satoshi had stated that he’d developed a brand-new virtual currency, which he’d then described, in detail, in an attached “white paper.” At first, Charlie had thought the email was a joke. Stupid bullshit, he’d told himself. Who was this Satoshi Nakamoto, anyway? Charlie looked around hacker forums for more background on this Satoshi character but could find nothing. Stranger still, Satoshi, who claimed to be a Japanese man in his midthirties, wrote his emails in perfect, idiomatic English. Once Charlie read the white paper, however, it was obvious that Satoshi was a polymath, a multidisciplinary genius who was an expert in cryptography, math, computer science, peer-to-peer networking, economics, and more.

Instead of middlemen, or gatekeepers, you have an open competition of miners, individually incentivized to validate transactions. No bank or government sits in judgment of transactions, or takes a piece of each slice of pie. Middlemen are replaced with math, or in the case of your example, an army of Charlie Buckets.” “And the Willy Wonka of Bitcoin,” Tyler said. “Who set all of this in motion: Satoshi Nakamoto.” Cameron knew from his reading that the creator of Bitcoin was no less mysterious than the fictional character from his analogy. On October 31, 2008, Satoshi Nakamoto had published his famous white paper titled: Bitcoin: A Peer-to-Peer Electronic Cash System, to the Cryptography Mailing List—“a low-noise moderated mailing list devoted to cryptographic technology and its political impact,” laying out “a new electronic cash system that’s fully peer-to-peer, with no trusted third party.”

Although the area had a reputation for being a bit of a party destination itself—not on par with Ibiza, but speckled with exclusive restaurants and summer outposts of notable Manhattan nightclubs—the twins had spent most of their time relaxing on the beach and devouring anything they could find on the subject of Bitcoin. At the time, not a single book on Bitcoin had been published; but by diving deep enough into the internet, the twins were able to find blog posts, Reddit posts, and articles written by early adopters, known as “Bitcoiners,”—as well as Satoshi Nakamoto’s original Bitcoin white paper. They’d also reached out by email to former professors at Harvard and Oxford, where they’d earned MBA degrees, to get more academic opinions on this new virtual currency. None of the professors they’d contacted—some of them among the most elite economics professors in the world—had ever heard of Bitcoin. When the twins had explained what they had learned so far, some responded in a knee-jerk way, labeling Bitcoin as some sort of scam or Ponzi scheme.


pages: 271 words: 52,814

Blockchain: Blueprint for a New Economy by Melanie Swan

23andMe, Airbnb, altcoin, Amazon Web Services, asset allocation, banking crisis, basic income, bioinformatics, bitcoin, blockchain, capital controls, cellular automata, central bank independence, clean water, cloud computing, collaborative editing, Conway's Game of Life, crowdsourcing, cryptocurrency, disintermediation, Edward Snowden, en.wikipedia.org, Ethereum, ethereum blockchain, fault tolerance, fiat currency, financial innovation, Firefox, friendly AI, Hernando de Soto, intangible asset, Internet Archive, Internet of things, Khan Academy, Kickstarter, lifelogging, litecoin, Lyft, M-Pesa, microbiome, Network effects, new economy, peer-to-peer, peer-to-peer lending, peer-to-peer model, personalized medicine, post scarcity, prediction markets, QR code, ride hailing / ride sharing, Satoshi Nakamoto, Search for Extraterrestrial Intelligence, SETI@home, sharing economy, Skype, smart cities, smart contracts, smart grid, software as a service, technological singularity, Turing complete, uber lyft, unbanked and underbanked, underbanked, web application, WikiLeaks

It is as if PayPal had called the Internet “PayPal,” upon which the PayPal protocol was run, to transfer the PayPal currency. The blockchain industry is using these terms interchangeably sometimes because it is still in the process of shaping itself into what could likely become established layers in a technology stack. Bitcoin was created in 2009 (released on January 9, 20096) by an unknown person or entity using the name Satoshi Nakamoto. The concept and operational details are described in a concise and readable white paper, “Bitcoin: A Peer-to-Peer Electronic Cash System.”7 Payments using the decentralized virtual currency are recorded in a public ledger that is stored on many—potentially all—Bitcoin users’ computers, and continuously viewable on the Internet. Bitcoin is the first and largest decentralized cryptocurrency.

However, nearly every other US government agency—including FinCEN (financial crimes enforcement network), banking regulators, and the CFPB, SEC, CFTC, and DOJ—regulate Bitcoin as a currency.31 Chapter 2. Blockchain 2.0: Contracts From its very beginning, complexity beyond currency and payments was envisioned for Bitcoin; the possibilities for programmable money and contracts were baked into the protocol at its invention. A 2010 communication from Satoshi Nakamoto indicates that “the design supports a tremendous variety of possible transaction types that I designed years ago. Escrow transactions, bonded contracts, third-party arbitration, multiparty signature, etc. If Bitcoin catches on in a big way, these are things we’ll want to explore in the future, but they all had to be designed at the beginning to make sure they would be possible later.”32 As we’ll see in Chapter 3, these structures could be applied beyond financial transactions, to any kind of transaction—even “figurative” ones.

These analogies might be like calling Chrome a “Napster 2.0,” or Facebook or AdBlock a “Web Browser 3.0.” The key idea is that the decentralized transaction ledger functionality of the blockchain could be used to register, confirm, and transfer all manner of contracts and property. Table 2-1 lists some of the different classes and examples of property and contracts that might be transferred with the blockchain. Satoshi Nakamoto started by specifying escrow transactions, bonded contracts, third-party arbitration, and multiparty signature transactions. All financial transactions could be reinvented on the blockchain, including stock, private equity, crowdfunding instruments, bonds, mutual funds, annuities, pensions, and all manner of derivatives (futures, options, swaps, and other derivatives). Table 2-1. Blockchain applications beyond currency (adapted from the Ledra Capital Mega Master Blockchain List; see Appendix B)34 Class Examples General Escrow transactions, bonded contracts, third-party arbitration, multiparty signature transactions Financial transactions Stock, private equity, crowdfunding, bonds, mutual funds, derivatives, annuities, pensions Public records Land and property titles, vehicle registrations, business licenses, marriage certificates, death certificates Identification Driver’s licenses, identity cards, passports, voter registrations Private records IOUs, loans, contracts, bets, signatures, wills, trusts, escrows Attestation Proof of insurance, proof of ownership, notarized documents Physical asset keys Home, hotel rooms, rental cars, automobile access Intangible assets Patents, trademarks, copyrights, reservations, domain names Public records, too, can be migrated to the blockchain: land and property titles, vehicle registrations, business licenses, marriage certificates, and death certificates.


pages: 410 words: 119,823

Radical Technologies: The Design of Everyday Life by Adam Greenfield

3D printing, Airbnb, augmented reality, autonomous vehicles, bank run, barriers to entry, basic income, bitcoin, blockchain, business intelligence, business process, call centre, cellular automata, centralized clearinghouse, centre right, Chuck Templeton: OpenTable:, cloud computing, collective bargaining, combinatorial explosion, Computer Numeric Control, computer vision, Conway's Game of Life, cryptocurrency, David Graeber, dematerialisation, digital map, disruptive innovation, distributed ledger, drone strike, Elon Musk, Ethereum, ethereum blockchain, facts on the ground, fiat currency, global supply chain, global village, Google Glasses, IBM and the Holocaust, industrial robot, informal economy, information retrieval, Internet of things, James Watt: steam engine, Jane Jacobs, Jeff Bezos, job automation, John Conway, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Kevin Kelly, Kickstarter, late capitalism, license plate recognition, lifelogging, M-Pesa, Mark Zuckerberg, means of production, megacity, megastructure, minimum viable product, money: store of value / unit of account / medium of exchange, natural language processing, Network effects, New Urbanism, Occupy movement, Oculus Rift, Pareto efficiency, pattern recognition, Pearl River Delta, performance metric, Peter Eisenman, Peter Thiel, planetary scale, Ponzi scheme, post scarcity, post-work, RAND corporation, recommendation engine, RFID, rolodex, Satoshi Nakamoto, self-driving car, sentiment analysis, shareholder value, sharing economy, Silicon Valley, smart cities, smart contracts, social intelligence, sorting algorithm, special economic zone, speech recognition, stakhanovite, statistical model, stem cell, technoutopianism, Tesla Model S, the built environment, The Death and Life of Great American Cities, The Future of Employment, transaction costs, Uber for X, undersea cable, universal basic income, urban planning, urban sprawl, Whole Earth Review, WikiLeaks, women in the workforce

We remain at the proof-of-concept stage: we now know that in principle, these things can be done. But all the social and intellectual heavy lifting begins now. 5 Cryptocurrency The computational guarantee of value All written accounts of the technological development we know as “the blockchain” begin and end the same way. They note its origins in the cryptocurrency called Bitcoin, and go on to explain how Bitcoin’s obscure, pseudonymous, possibly even multiple inventor “Satoshi Nakamoto” used it to solve the problems of trust that had foxed all previous attempts at networked digital money. They all make much of the blockchain’s potential to transform the way we exchange value, in every context and at every level of society. And they all gesture at the exciting possibilities that lie beyond currency: the world of smart contracts, distributed applications, autonomous organizations and post-human economies, all mediated by “trustless” cryptographic techniques.

With its carnage of foreclosures, evictions, layoffs and bank runs, the acute crisis of 2008 sufficed to prove to many that the core financial institutions of the West couldn’t be trusted—and if not the central banks, how much less so a bunch of cowboy startups? Perhaps people simply had more pressing concerns on their mind, and weren’t necessarily inclined to take a wild leap into the technological unknown. Or maybe that’s looking at things the wrong way around. Maybe a time of cratering confidence in existing institutions is precisely the correct moment at which to propose something fundamentally new. Enter “Satoshi Nakamoto.”2 Nakamoto’s was the sole name on a nine-page paper describing the proposed design of a new digital currency, first posted to the Cryptography mailing list on Halloween 2008, and in one or two other places around the internet soon thereafter.3 There is still very little we can say about “him” for sure, even whether he wasn’t actually a team of close collaborators producing work under a collective pseudonym.

How might such a thing be useful? Who devised these tools, and why? It sometimes seems that every age gets the technological icons it deserves, and if so it would be hard to invent a character more pungently appropriate to our own than Vitalik Buterin. Though an identifiable, individual, flesh-and-blood human being, Buterin is in every other way almost as much of a cipher as the mysterious Satoshi Nakamoto. We know a few biographical facts; we know too that he is evidently a fierce believer in the decentralization of power. But otherwise he is a blank. So little personal information about him is available that it’s all but impossible to get a sense of who he is, or what values he might cherish beyond this one core conviction.1 Born in Russia in 1994, Buterin was just shy of twenty when he dropped out of Ontario’s Waterloo University, spurred by a $100,000 grant from the foundation of libertarian venture capitalist Peter Thiel.


pages: 364 words: 99,897

The Industries of the Future by Alec Ross

23andMe, 3D printing, Airbnb, algorithmic trading, AltaVista, Anne Wojcicki, autonomous vehicles, banking crisis, barriers to entry, Bernie Madoff, bioinformatics, bitcoin, blockchain, Brian Krebs, British Empire, business intelligence, call centre, carbon footprint, cloud computing, collaborative consumption, connected car, corporate governance, Credit Default Swap, cryptocurrency, David Brooks, disintermediation, Dissolution of the Soviet Union, distributed ledger, Edward Glaeser, Edward Snowden, en.wikipedia.org, Erik Brynjolfsson, fiat currency, future of work, global supply chain, Google X / Alphabet X, industrial robot, Internet of things, invention of the printing press, Jaron Lanier, Jeff Bezos, job automation, John Markoff, Joi Ito, Kickstarter, knowledge economy, knowledge worker, lifelogging, litecoin, M-Pesa, Marc Andreessen, Mark Zuckerberg, Mikhail Gorbachev, mobile money, money: store of value / unit of account / medium of exchange, Nelson Mandela, new economy, offshore financial centre, open economy, Parag Khanna, paypal mafia, peer-to-peer, peer-to-peer lending, personalized medicine, Peter Thiel, precision agriculture, pre–internet, RAND corporation, Ray Kurzweil, recommendation engine, ride hailing / ride sharing, Rubik’s Cube, Satoshi Nakamoto, selective serotonin reuptake inhibitor (SSRI), self-driving car, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart cities, social graph, software as a service, special economic zone, supply-chain management, supply-chain management software, technoutopianism, The Future of Employment, Travis Kalanick, underbanked, Vernor Vinge, Watson beat the top human players on Jeopardy!, women in the workforce, Y Combinator, young professional

Bitcoin came about both as a result of declining trust in the traditional financial system during the financial crisis and because of its technological advance in creating a trustable mechanism for monetary exchange online. On October 31, 2008, a research paper, “Bitcoin: A Peer-to-Peer Electronic Cash System,” was published on a cryptography listserv by a mysterious author identified as “Satoshi Nakamoto” who has kept his/her (their?) identity unknown. It called for the creation of the world’s “first decentralized digital currency.” Satoshi Nakamoto condemned state-based currencies: The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve.

Fraud is further diminished by the fact that every bitcoin carries its history with it; to try to counterfeit a coin would require counterfeiting a false lineage going back all the way to the beginning of Bitcoin. It would never be accepted by the system, since the millions of copies of the ledger that reside throughout the rest of the Bitcoin network would not have any record of this counterfeit coin or its invented history. A widely distributed ledger lets everyone know who has what and prevents any individual from barging in with counterfeited property. The major headache that Satoshi Nakamoto conquered, and that every previous cryptocurrency had failed to manage, was the question of how to update that decentralized ledger: How could you make sure that the millions of copies of the master ledger, which are located far and wide throughout the Bitcoin network, are all the same, all accurate, all up to date, without anyone cheating? The answer to this question is what gives the blockchain its name and what makes decentralized digital trust actually possible.

Litecoin markets itself as being more abundant and faster to mine than bitcoins. Charlie Lee, a former Google software engineer, designed Litecoin in his spare time and launched it in 2011 to complement Bitcoin. Lee said, “People like choices. You want to diversify your cryptocurrency investments.” He has described Litecoin as “silver to Bitcoin’s gold,” and he designed the Litecoin software to produce 84 million litecoins in comparison to Satoshi Nakamoto’s design for 21 million bitcoins. Lee also decided to use scrypt cryptography to reduce mining rates per unit down to 2.5 minutes in comparison to Bitcoin’s 10 minutes. Lee also chose this type of cryptography, which relies on computer memory rather than processing power, to avoid the kind of high-carbon arms race he sees among miners in the Bitcoin community. Ripple markets itself as a global payment platform by allowing members to pay in any currency—from its own currency, the ripple (XRP), to bitcoins to state-based currencies.


pages: 200 words: 47,378

The Internet of Money by Andreas M. Antonopoulos

AltaVista, altcoin, bitcoin, blockchain, clean water, cognitive dissonance, cryptocurrency, disruptive innovation, Ethereum, ethereum blockchain, financial exclusion, global reserve currency, litecoin, London Interbank Offered Rate, Marc Andreessen, Oculus Rift, packet switching, peer-to-peer lending, Ponzi scheme, QR code, ransomware, reserve currency, Satoshi Nakamoto, self-driving car, Skype, smart contracts, the medium is the message, trade route, underbanked, WikiLeaks, zero-sum game

Just that allows you to grasp how disruptive this technology is going to be in terms of international payment systems. But this is just the beginning. Bitcoin is a digital currency that came into existence in 2008 as an invention by a person called Satoshi Nakamoto. He published a paper where he posited that he had found the way to create a decentralized network that could achieve consensus, agreement, without any central controlling authority. Now, if you have studied computer science or distributed systems, this is known as the Byzantine Generals’ Problem. It was first described in 1982. Until 2008, it was an unsolved problem. Then, Satoshi Nakamoto said, "I have solved it." Guess what happened next? Everybody laughed, ignored him, and dismissed him. He published his paper, and three months later, he published software that allowed people to start building the bitcoin network.

He published his paper, and three months later, he published software that allowed people to start building the bitcoin network. Bitcoin is not a company. It is not an organization. It is a standard or a protocol just like TCP/IP, or the internet. It’s not owned by anyone. It operates by simple mathematical rules that everyone who participates in the network agrees on. Through this simple mechanism, through this invention of Satoshi Nakamoto, bitcoin is able to allow a completely decentralized network of computers to agree on what transactions have occurred on a network, essentially agreeing on who currently has the money. So, if I send money from my account to somebody else’s account in this peer-to-peer, completely decentralized network, it’s just like sending an email. There’s no one in the middle. Every ten minutes, the entire network agrees on what transactions have happened, without any centralized authority, by a simple election that occurs electronically.


Mastering Blockchain, Second Edition by Imran Bashir

3D printing, altcoin, augmented reality, autonomous vehicles, bitcoin, blockchain, business process, carbon footprint, centralized clearinghouse, cloud computing, connected car, cryptocurrency, data acquisition, Debian, disintermediation, disruptive innovation, distributed ledger, domain-specific language, en.wikipedia.org, Ethereum, ethereum blockchain, fault tolerance, fiat currency, Firefox, full stack developer, general-purpose programming language, gravity well, interest rate swap, Internet of things, litecoin, loose coupling, MITM: man-in-the-middle, MVC pattern, Network effects, new economy, node package manager, Oculus Rift, peer-to-peer, platform as a service, prediction markets, QR code, RAND corporation, Real Time Gross Settlement, reversible computing, RFC: Request For Comment, RFID, ride hailing / ride sharing, Satoshi Nakamoto, single page application, smart cities, smart contracts, smart grid, smart meter, supply-chain management, transaction costs, Turing complete, Turing machine, web application, x509 certificate

Looking at all the technologies mentioned earlier and their relevant history, it is easy to see how concepts from electronic cash schemes and distributed systems were combined to create Bitcoin and what now is known as blockchain. This concept can also be visualized with the help of the following diagram: The various ideas that supported the invention of Bitcoin and blockchain Blockchain In 2008, a groundbreaking paper entitled Bitcoin: A Peer-to-Peer Electronic Cash System was written on the topic of peer-to-peer electronic cash under the pseudonym Satoshi Nakamoto. It introduced the term chain of blocks. No one knows the actual identity of Satoshi Nakamoto. After introducing Bitcoin in 2009, he remained active in the Bitcoin developer community until 2011. He then handed over Bitcoin development to its core developers and simply disappeared. Since then, there has been no communication from him whatsoever, and his existence and identity are shrouded in mystery. The term chain of blocks evolved over the years into the word blockchain.

This has also sparked a great interest in academic and industrial research and introduced many new research areas. Since its introduction in 2008 by Satoshi Nakamoto, Bitcoin has gained massive popularity, and it is currently the most successful digital currency in the world with billions of dollars invested in it. The current market cap, at the time of writing, for this currency is $149, 984, 293, 122. Its popularity is also evident from the high number of users and investors, increasing bitcoin price, everyday news related to Bitcoin, and the number of start-ups and companies that are offering bitcoin-based online exchanges, and it's now also traded as Bitcoin Futures on Chicago Mercantile Exchange (CME). Interested readers can read more about Bitcoin Futures at http://www.cmegroup.com/trading/bitcoin-futures.html. The name of the Bitcoin inventor Satoshi Nakamoto is believed to be a pseudonym, as the true identity of Bitcoin inventor is unknown.

Reusable Proof of Work (RPoW) was introduced in 2004 by Hal Finney, a computer scientist, developer and first person to receive Bitcoin from Satoshi Nakamoto. It used the hashcash scheme by Adam Back as a proof of computational resources spent to create the money. This was also a central system that kept a central database to keep track of all used PoW tokens. This was an online system that used remote attestation made possible by a trusted computing platform (TPM hardware). All the previously mentioned schemes are intelligently designed but were weak from one aspect or another. Specifically, all these schemes rely on a central server that is required to be trusted by the users. Bitcoin In 2008, Bitcoin was introduced through a paper called, Bitcoin: A Peer-to-Peer Electronic Cash System. This paper is available at https://bitcoin.org/bitcoin.pdf. It was written by Satoshi Nakamoto, which is believed to be a pseudonym, as the true identity of Bitcoin inventor is unknown and subject of much speculation.


pages: 87 words: 25,823

The Politics of Bitcoin: Software as Right-Wing Extremism by David Golumbia

3D printing, A Declaration of the Independence of Cyberspace, Affordable Care Act / Obamacare, bitcoin, blockchain, Burning Man, crony capitalism, cryptocurrency, currency peg, distributed ledger, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, Extropian, fiat currency, Fractional reserve banking, George Gilder, jimmy wales, litecoin, Marc Andreessen, money: store of value / unit of account / medium of exchange, Mont Pelerin Society, new economy, obamacare, Peter Thiel, Philip Mirowski, risk tolerance, Ronald Reagan, Satoshi Nakamoto, seigniorage, Silicon Valley, Singularitarianism, smart contracts, Stewart Brand, technoutopianism, The Chicago School, Travis Kalanick, WikiLeaks

Quite a few apparently responsible pieces (e.g. Vigna and Casey 2015) have made claims like this at the same time that Bitcoin has been experiencing not just inflation but hyperinflation of exactly the sort Federal Reserve “critics” claim to fear most. The Bitcoin software has a distinct origin point, in a 2008 paper titled “Bitcoin: A Peer-to-Peer Electronic Cash System,” by a pseudonymous author who called himself “Satoshi Nakamoto.” Yet we need to reach back deeper into history to grasp Bitcoin’s complete political and intellectual contexts. Most of those involved in the development and early adoption of Bitcoin were and are part of several intersecting communities who have long put a huge amount of faith into very specific technological–political orientations toward the world, ones grounded in overtly right-wing thought, typically coupled with myopic technological utopianism.

Berlet, Chip, and Matthew N. Lyons. 2000. Right-Wing Populism in America: Too Close for Comfort. New York: Guilford Press. Berlin, Isaiah. 1958. “Two Concepts of Liberty.” In Liberty, 166–217. New York: Oxford University Press, 2002. Birchall, Clare. 2006. Knowledge Goes Pop: From Conspiracy Theory to Gossip. Oxford, UK: Berg. Boase, Richard. 2013. “Cypherpunks, Bitcoin, and the Myth of Satoshi Nakamoto.” Cybersalon (September 5). http://www.cybersalon.org/. Borchgrevink, Jonas. 2014. “Ron Paul Loves His Own Ron Paul Coin and Is Positive about Bitcoin.” CryptoCoinsNews (January 16). http://www.cryptocoinsnews.com/. Brands, H. W. 2006. The Money Men: Capitalism, Democracy, and the Hundred Years’ War over the American Dollar. New York: Norton. Bratich, Jack Z. 2008. Conspiracy Panics: Political Rationality and Popular Culture.


pages: 316 words: 117,228

The Code of Capital: How the Law Creates Wealth and Inequality by Katharina Pistor

"Robert Solow", Andrei Shleifer, Asian financial crisis, asset-backed security, barriers to entry, Bernie Madoff, bilateral investment treaty, bitcoin, blockchain, Bretton Woods, business cycle, business process, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collateralized debt obligation, colonial rule, conceptual framework, Corn Laws, corporate governance, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, cryptocurrency, Donald Trump, double helix, Edward Glaeser, Ethereum, ethereum blockchain, facts on the ground, financial innovation, financial intermediation, fixed income, Francis Fukuyama: the end of history, full employment, global reserve currency, Hernando de Soto, income inequality, intangible asset, investor state dispute settlement, invisible hand, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, Kenneth Rogoff, land reform, land tenure, London Interbank Offered Rate, Long Term Capital Management, means of production, money market fund, moral hazard, offshore financial centre, phenotype, Ponzi scheme, price mechanism, price stability, profit maximization, railway mania, regulatory arbitrage, reserve currency, Ronald Coase, Satoshi Nakamoto, secular stagnation, self-driving car, shareholder value, Silicon Valley, smart contracts, software patent, sovereign wealth fund, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thorstein Veblen, time value of money, too big to fail, trade route, transaction costs, Wolfgang Streeck

Bitcoin traded at only $900 at the beginning of 2017, but was quoted at $20,000 per coin in December of the same year. Since then, the trend has been downward, and by the fall of 2018, it stood at roughly $6,000, having shed more than two-thirds 198 c h a P te r 8 of its value in dollar terms—and other cryptocurrencies did not fare much better.39 Nobody knows exactly who invented Bitcoin. Satoshi Nakamoto, the official creator, is an alias for one, or perhaps several, digital coders. Some have proposed that Nick Szabo, the brain behind smart contracts and digital property rights, is the man behind Bitcoin, but he has denied this. Another contender is Craig Wright, a professed gambler from Australia who outed himself as the person behind the pseudonym, but not everyone is convinced.40 Be this as it may, Bitcoin embodies the hope of crypto-anarchists of a state-less future, but also the fears of conventional law enforcers about losing control over the financial flows that fund illicit businesses.

Recall the dilemma of Antonio in Shakespeare’s Merchant of Venice discussed in chapter 4, whose ship had not reached shore a n e w co d e ? 199 yet. As it happened, it never did, but it might have; and indeed, most ships do at least most of the time. There is, however, one aspect in which Bitcoin departs from these other forms of private money. Bitcoin is designed as money without credit: nobody can spend Bitcoin without proof of ownership.43 The “Bitcoin Manifesto,” published by the ominous Satoshi Nakamoto, explains that a key motivation for creating Bitcoin was to solve the “double-spending problem.”44 Yet, the ability to spend money one does not have is—for better or worse—the very essence of capitalism. Other forms of private money, the notes, bills of exchange, asset-backed securities, etc., are IOUs that are all assigned and traded with the expectation that they are convertible into state money whenever needed, and hopefully at a profit; convertibility may not be guaranteed, but the promise of convertibility makes these assets attractive and finds them buyers.

According to the materials collected by the FCIC, after not having had to pay collateral on a single CDS, AIGFP, the dominant player in the market, was 272 n ote s to c h a P te r 8 charged by Goldman Sachs to pay US$1.8 billion from one day to the next. See http://fcic-static.law.stanford.edu/cdn_media/fcic-docs/2007-07-27_Goldman _Sachs_Collateral_Invoice_to_AIG.pdf (last accessed June 21, 2017). 20. For details, see chapter 4. 21. Nick Szabo, Secure Property Titles with Owner Authority, 1998, publications of the Satoshi Nakamoto Institute, available online at https://nakamotoinstitute .org/secure-property-titles/. 22. See Coase, Problem of Social Cost, p. 15. 23. Szabo, Secure Property. 24. Ibid., p. 3. 25. Ibid. 26. Ibid., p. 7. 27. De Soto, The Mystery of Capital, p. 179. 28. For a survey of the effects of formalizing property rights in the developing world in recent years, see Klaus Deininger, Land Policies for Growth and Poverty Reduction, World Bank Policy Research Reports (Washington, DC: World Bank, 2003). 29.


pages: 218 words: 68,648

Confessions of a Crypto Millionaire: My Unlikely Escape From Corporate America by Dan Conway

Affordable Care Act / Obamacare, Airbnb, bank run, basic income, bitcoin, blockchain, buy and hold, cloud computing, cognitive dissonance, corporate governance, crowdsourcing, cryptocurrency, disruptive innovation, distributed ledger, double entry bookkeeping, Ethereum, ethereum blockchain, fault tolerance, financial independence, gig economy, Gordon Gekko, Haight Ashbury, high net worth, job satisfaction, litecoin, Marc Andreessen, Mitch Kapor, obamacare, offshore financial centre, Ponzi scheme, prediction markets, rent control, reserve currency, Ronald Coase, Satoshi Nakamoto, Silicon Valley, smart contracts, Steve Jobs, supercomputer in your pocket, Turing complete, Uber for X, universal basic income, upwardly mobile

In a distributed—or decentralized—system, if any node was compromised, the remaining untainted nodes could still ensure the transaction was completed. It was an elusive goal, and they had several false starts. The Hashcash and Digicash projects achieved breakthroughs but ultimately didn’t work. The two most difficult challenges were removing every single point of failure and preventing “double spends,” which could occur if the same money was sent to two different parties. In October 2008, a person or persons named Satoshi Nakamoto sent an email to the cypherpunk email list, introducing Bitcoin. He said he’d solved the digital money problem. He attached a nine-page white paper explaining how he’d done it. “In this paper, we propose a solution to the double-spending problem using a peer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions.” Satoshi proposed that each peer-to-peer transaction be arranged into a block of transactions.

In late 2017, Bitcoin evangelist and icon Andreas Antonopoulos announced that he was struggling financially. It was inconceivable to me that he hadn’t bought and held bitcoin when it was under twenty dollars. I had assumed he had the equivalent of at least twenty to thirty million by this time, considering how early he was to the game. He was one of the smartest people in crypto, a genius at communicating the enormity of Satoshi Nakamoto’s invention and what it meant for society. He flew all over the globe, spreading the word. But he wasn’t able to hold a stash due to other financial pressures, even though only a few thousand dollars invested and held at those low prices would have been worth at least a million dollars a few years later. He had been left out of the get-rich-quick part of the revolution he helped to create.

Public blockchains based on cryptocurrency have reintroduced decentralization as an organizing principle worth exploring. Could solutions to problems like global warming that require broad consensus across the globe, which no single government can solve on its own, be enabled through blockchain? Yes, they could. Whether it takes years, decades, or a century for blockchain to enter its prime is not a question I’m prepared to answer. But I believe it is a good thing, an amazing thing, that Satoshi Nakamoto’s invention offers us a new tool to address some of the most important problems facing the planet. Who exactly will use blockchain, and in what way? The better question is: what is possible? If we don’t thoughtfully ask, we could end up sounding like President Rutherford Hayes in 1876, at the dawn of the telephone age, an invention that extended the reach of the modern corporation. Of the telephone, he said, “An amazing invention, but who would ever want to use one?”


pages: 254 words: 76,064

Whiplash: How to Survive Our Faster Future by Joi Ito, Jeff Howe

3D printing, Albert Michelson, Amazon Web Services, artificial general intelligence, basic income, Bernie Sanders, bitcoin, Black Swan, blockchain, Burning Man, buy low sell high, Claude Shannon: information theory, cloud computing, Computer Numeric Control, conceptual framework, crowdsourcing, cryptocurrency, data acquisition, disruptive innovation, Donald Trump, double helix, Edward Snowden, Elon Musk, Ferguson, Missouri, fiat currency, financial innovation, Flash crash, frictionless, game design, Gerolamo Cardano, informal economy, interchangeable parts, Internet Archive, Internet of things, Isaac Newton, Jeff Bezos, John Harrison: Longitude, Joi Ito, Khan Academy, Kickstarter, Mark Zuckerberg, microbiome, Nate Silver, Network effects, neurotypical, Oculus Rift, pattern recognition, peer-to-peer, pirate software, pre–internet, prisoner's dilemma, Productivity paradox, race to the bottom, RAND corporation, random walk, Ray Kurzweil, Ronald Coase, Ross Ulbricht, Satoshi Nakamoto, self-driving car, SETI@home, side project, Silicon Valley, Silicon Valley startup, Simon Singh, Singularitarianism, Skype, slashdot, smart contracts, Steve Ballmer, Steve Jobs, Steven Levy, Stewart Brand, Stuxnet, supply-chain management, technological singularity, technoutopianism, The Nature of the Firm, the scientific method, The Signal and the Noise by Nate Silver, There's no reason for any individual to have a computer in his home - Ken Olsen, Thomas Kuhn: the structure of scientific revolutions, universal basic income, unpaid internship, uranium enrichment, urban planning, WikiLeaks

And so Rubin spent much of his sophomore and junior years wondering whether he would be prosecuted for a project that was neither fraudulent nor functional. Scientists and inventors are often all too ready to claim credit for an important discovery. So it is one of our age’s more baffling mysteries that the man—or woman, or group of men and women—behind the biggest financial innovation since the ATM remains stubbornly, sincerely anonymous. It started on November 1, 2008, when someone calling himself Satoshi Nakamoto posted “Bitcoin: A Peer-to-Peer Electronic Cash System” to a cryptography mailing list.20 In his introduction, he wrote, “I’ve been working on a new electronic cash system that’s fully peer-to-peer, with no trusted third party.… The main properties: Double-spending is prevented with a peer-to-peer network. No mint or other trusted parties. Participants can be anonymous. New coins are made from Hashcash style proof-of-work.

But this storyline exhibits a fundamental misunderstanding of the new age. American companies and Chinese companies are in the same boat. The dinosaurs don’t need to be worried about other dinosaurs. They need to start thinking like, acting like, the frogs. This attitude toward risk goes a long way toward explaining how Bitcoin could come into being at all. Until 2010, when he gave Gavin Andresen the keys to the Bitcoin SourceForge project, Satoshi Nakamoto—the pseudonymous creator of the software that enabled the creation of Bitcoin—himself made nearly all of the modifications to the software. According to Andresen, former chief scientist of the Bitcoin Foundation, Satoshi’s original code still made up about 30 percent of Bitcoin Core in late 2015.11 In the same talk, Andresen noted that the core developers—the individuals with authority to accept changes to Bitcoin Core—were “cranky and risk-averse,” but not as cranky and risk-averse as Satoshi was.

., “K-Pg Extinction: Reevaluation of the Heat-Fire Hypothesis,” Journal of Geophysical Research: Biogeosciences 118, no. 1 (March 1, 2013): 329–36, doi:10.1002/jgrg.20018. 10 Bjorn Carey, “The Perils of Being Huge: Why Large Creatures Go Extinct,” Live Science, July 18, 2006, http://www.livescience.com/4162-perils-huge-large-creatures-extinct.html. 11 “MLTalks: Bitcoin Developers Gavin Andresen, Cory Fields, and Wladimir van Der Laan” (MIT Media Lab, November 17, 2015), http://www.media.mit.edu/events/2015/11/17/mltalks-bitcoin-developers-gavin-andresen-cory-fields-and-wladimir-van-der-laan. 12 The immediate justification for revoking Andresen’s commit access was a blog post he wrote stating that he believed Australian programmer Craig Wright’s claim to be Satoshi Nakamoto, and which other core developers took as evidence that Andresen had been hacked. For an overview of the controversy, see Maria Bustillos, “Craig Wright’s ‘Proof’ He Invented Bitcoin Is the ‘Canadian Girlfriend of Cryptographic Signatures’,” New York, May 3, 2016, http://nymag.com/selectall/2016/05/craig-wright-s-proof-he-invented-bitcoin-is-basically-a-canadian-girlfriend.html. 13 “2009 Exchange Rate—New Liberty Standard,” February 5, 2010, http://newlibertystandard.wikifoundry.com/page/2009+Exchange+Rate. 14 John Biggs, “Happy Bitcoin Pizza Day!


pages: 275 words: 84,980

Before Babylon, Beyond Bitcoin: From Money That We Understand to Money That Understands Us (Perspectives) by David Birch

agricultural Revolution, Airbnb, bank run, banks create money, bitcoin, blockchain, Bretton Woods, British Empire, Broken windows theory, Burning Man, business cycle, capital controls, cashless society, Clayton Christensen, clockwork universe, creative destruction, credit crunch, cross-subsidies, crowdsourcing, cryptocurrency, David Graeber, dematerialisation, Diane Coyle, disruptive innovation, distributed ledger, double entry bookkeeping, Ethereum, ethereum blockchain, facts on the ground, fault tolerance, fiat currency, financial exclusion, financial innovation, financial intermediation, floating exchange rates, Fractional reserve banking, index card, informal economy, Internet of things, invention of the printing press, invention of the telegraph, invention of the telephone, invisible hand, Irish bank strikes, Isaac Newton, Jane Jacobs, Kenneth Rogoff, knowledge economy, Kuwabatake Sanjuro: assassination market, large denomination, M-Pesa, market clearing, market fundamentalism, Marshall McLuhan, Martin Wolf, mobile money, money: store of value / unit of account / medium of exchange, new economy, Northern Rock, Pingit, prediction markets, price stability, QR code, quantitative easing, railway mania, Ralph Waldo Emerson, Real Time Gross Settlement, reserve currency, Satoshi Nakamoto, seigniorage, Silicon Valley, smart contracts, social graph, special drawing rights, technoutopianism, the payments system, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, tulip mania, wage slave, Washington Consensus, wikimedia commons

Our argument was that emerging technologies – particularly the synthesis of cryptographic software and tamper-resistant chips – would, we said (as did many others), make the cost of entry into the currency ‘market’ quite small. Many organizations beyond central banks and commercial banks might then wish to create private money. This could be as a means of supplying credit, as envisaged by the Nobel-winning economist Friedrich Hayek in 1970s, or it could be a means of encouraging customer loyalty, as explored by lateral thinker Edward de Bono in the 1990s. There might also be idealistic reasons, as explored by ‘Satoshi Nakamoto’, the mysterious inventor of the cryptographic asset Bitcoin (Vigna and Casey 2015), and others since 2008. I will explore all these possibilities in my ‘5Cs’ of money creation (central banks, commercial banks, companies, communities and cryptography) in more detail later in this book, before settling on a narrative for the ‘next money’ that is likely to surprise you. * * * * He then goes on to describe what are in fact offline pre-authorized debit cards, but that is by-the-by. ** One of the only twelve of these coins known to still exist was acquired by a Texan collector in August 2016 for an undisclosed sum.

We’re using the mentality of coins and the institutions of paper to try and deliver the money for a new economy. It is time for the debate on redesign that Christine Desan called for. Chapter 13 Counting on cryptography A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. — ‘Satoshi Nakamoto’ (2008) Having said earlier that the iconic technology of money is the plastic card, right now the iconic money of the future seems to be cryptocurrency. Spurred on by the widespread interest in Bitcoin, there are many people looking at the concept and wondering whether cryptocurrency – money that depends on cryptography rather than the belief of a community – might be a feature in the emerging money landscape.

Despite the widespread interest, Bitcoins do not seem to be gaining much traction in the ‘real world’ of payments. Wait? Bitcoin? Bitcoin is a decentralized, peer-to-peer means of exchange. If you have a Bitcoin, which is just a string of numbers, you can send that Bitcoin (or a subdivision of it) to anyone else. (If you want to understand how Bitcoin works, a good place to start is the original paper on the topic: ‘Bitcoin: a peer-to-peer electronic cash system’ by ‘Satoshi Nakamoto’.) I’m no expert on cryptography but there’s no reason I know of to question the basic idea: use a computationally difficult challenge to create strings of bits that it’s hard to make but easy to copy, then use digital signatures for transactions. I get my Bitcoin (a string of bits) and then to transfer them to you I add a digital signature and send them to you. Every time we do a transaction, we tell (essentially) everybody else that the bits now belong to you.


Bit by Bit: How P2P Is Freeing the World by Jeffrey Tucker

Affordable Care Act / Obamacare, Airbnb, airport security, altcoin, bank run, bitcoin, blockchain, business cycle, crowdsourcing, cryptocurrency, disintermediation, distributed ledger, Fractional reserve banking, George Gilder, Google Hangouts, informal economy, invisible hand, Kickstarter, litecoin, Lyft, obamacare, Occupy movement, peer-to-peer, peer-to-peer lending, QR code, ride hailing / ride sharing, Ross Ulbricht, Satoshi Nakamoto, sharing economy, Silicon Valley, Skype, TaskRabbit, the payments system, uber lyft

It’s just some computer thing that someone made up. Consider the criticism of goldbugs, who have, for decades, pushed the idea that sound money must be backed by something real, hard, and independently valuable. Bitcoin doesn’t qualify as sound money, right? Maybe it does. Let’s take a closer look. Bitcoin first emerged as a possible competitor to national, government-managed money nearly six years ago. Satoshi Nakamoto’s white paper was released October 31, 2008. The structure and language of this paper sent the message: This currency is for computer technicians, not economists nor political pundits. The paper's circulation was limited; novices who read it were mystified. But the lack of interest didn’t stop history from moving forward. Two months later, those who were paying attention saw the emergence of the “Genesis Block,” the first group of bitcoins generated through Nakamoto’s concept of a distributed ledger that lived on any computer node in the world that wanted to host it.

Looking back at those days, it seems obvious now that this was a turning point in history, a time in which it became very clear to some very smart people in the world that the U.S. government’s system of financial and monetary management was broken. If an entire system could be brought down by declining house prices, is it really robust enough to support global economic growth too much further into the future? Enter the faceless programmer, Satoshi Nakamoto. Around the same time as the housing crash, he was putting the finishing touches on his newly proposed currency network, bitcoin. It would be created entirely out of code. It would have all the main features that we know good money has. It would be divisible, portable, durable, uniform in quality, and scarce. He chose the model of open source code: everyone could see exactly how it is made.


pages: 329 words: 95,309

Digital Bank: Strategies for Launching or Becoming a Digital Bank by Chris Skinner

algorithmic trading, AltaVista, Amazon Web Services, Any sufficiently advanced technology is indistinguishable from magic, augmented reality, bank run, Basel III, bitcoin, business cycle, business intelligence, business process, business process outsourcing, buy and hold, call centre, cashless society, clean water, cloud computing, corporate social responsibility, credit crunch, crowdsourcing, cryptocurrency, demand response, disintermediation, don't be evil, en.wikipedia.org, fault tolerance, fiat currency, financial innovation, Google Glasses, high net worth, informal economy, Infrastructure as a Service, Internet of things, Jeff Bezos, Kevin Kelly, Kickstarter, M-Pesa, margin call, mass affluent, MITM: man-in-the-middle, mobile money, Mohammed Bouazizi, new economy, Northern Rock, Occupy movement, Pingit, platform as a service, Ponzi scheme, prediction markets, pre–internet, QR code, quantitative easing, ransomware, reserve currency, RFID, Satoshi Nakamoto, Silicon Valley, smart cities, social intelligence, software as a service, Steve Jobs, strong AI, Stuxnet, trade route, unbanked and underbanked, underbanked, upwardly mobile, We are the 99%, web application, WikiLeaks, Y2K

Instead of a central bank issuing the currency, Bitcoins are issued by anyone with a computer or smartphone, and are issued using encryption algorithms. In other words, extremely difficult mathematical problems are incorporated into each coin and transactions are cryptographically authenticated. This makes Bitcoins a combination of a commodity and a fiat currency, with the creation of Bitcoin dating back to 2008 when Satoshi Nakamoto published a white paper about a peer-to-peer exchange of value for the internet age. [28] The coins are digital currency designed to be controlled through encryption, rather than a centralised authority, and potentially operate in exactly the same way as cash. Bitcoins are fully exchangeable as an anonymous form of currency in real-time across the internet and Point-of-Sale, with core features that they can be: Sent to anyone with a Bitcoin address; Accessed from anywhere with an Internet connection; Anybody can start buying, selling or accepting Bitcoins regardless of their location; Completely distributed with no bank or payment processor between users (this decentralization is the basis for Bitcoin’s security and freedom); and Transactions are free (for now, this will change).

The reason why Bitcoins are viewed as dangerous by governments is for exactly the reasons cited earlier – they cannot be controlled – and there will be a long and arduous battle between controllers and the uncontrolled. This is the nature of the Wikiconomy. Nevertheless, I have invested in Bitcoins and suggest you do too, as it is very likely that they will be a major store of value for years to come in the near term. Bitcoin’s timeline[29] 2008–2009 In 2008, Satoshi Nakamoto posted a paper describing the Bitcoin protocol on the internet. In 2009, the Bitcoin network came into existence with the release of the first open source Bitcoin client and the issuance of the first Bitcoins. 2010 The prices for the first Bitcoin transactions were negotiated by individuals on the Bitcointalk forums. One notable transaction involved a 10,000 BTC pizza. On 6 August, a major vulnerability in the Bitcoin protocol was spotted.

The other business will be for firms that want to access international markets from one country and have issues with chargebacks and structures. They may be shipping under $35 goods or services, or shipping a digital service rather than physical goods, and these firms may find that Bitcoin, relying solely on code and mathematics, is the only currency they could use. It’s a bit technical however, isn’t it? That’s the biggest barrier to Bitcoin. It’s not end-user friendly. Every client is working off the first codebase. Satoshi Nakamoto solved the last logic problem to create a decentralized currency. He’s an academic, incredibly smart, but not a computer engineer. The code was not written in the most efficient way therefore, but every client today has built off this code. Now, for the first time, we are rewriting the code from the ground up to be more efficient and effective. The new code is being built from scratch in a modular fashion, so merchants can take it and change it and it will be much faster and end-user friendly.


pages: 501 words: 114,888

The Future Is Faster Than You Think: How Converging Technologies Are Transforming Business, Industries, and Our Lives by Peter H. Diamandis, Steven Kotler

Ada Lovelace, additive manufacturing, Airbnb, Albert Einstein, Amazon Mechanical Turk, augmented reality, autonomous vehicles, barriers to entry, bitcoin, blockchain, blood diamonds, Burning Man, call centre, cashless society, Charles Lindbergh, Clayton Christensen, clean water, cloud computing, Colonization of Mars, computer vision, creative destruction, crowdsourcing, cryptocurrency, Dean Kamen, delayed gratification, dematerialisation, digital twin, disruptive innovation, Edward Glaeser, Edward Lloyd's coffeehouse, Elon Musk, en.wikipedia.org, epigenetics, Erik Brynjolfsson, Ethereum, ethereum blockchain, experimental economics, food miles, game design, Geoffrey West, Santa Fe Institute, gig economy, Google X / Alphabet X, gravity well, hive mind, housing crisis, Hyperloop, indoor plumbing, industrial robot, informal economy, Intergovernmental Panel on Climate Change (IPCC), Internet of things, invention of the telegraph, Isaac Newton, Jaron Lanier, Jeff Bezos, job automation, Joseph Schumpeter, Kevin Kelly, Kickstarter, late fees, Law of Accelerating Returns, life extension, lifelogging, loss aversion, Lyft, M-Pesa, Mary Lou Jepsen, mass immigration, megacity, meta analysis, meta-analysis, microbiome, mobile money, multiplanetary species, Narrative Science, natural language processing, Network effects, new economy, New Urbanism, Oculus Rift, out of africa, packet switching, peer-to-peer lending, Peter H. Diamandis: Planetary Resources, Peter Thiel, QR code, RAND corporation, Ray Kurzweil, RFID, Richard Feynman, Richard Florida, ride hailing / ride sharing, risk tolerance, Satoshi Nakamoto, Second Machine Age, self-driving car, Silicon Valley, Skype, smart cities, smart contracts, smart grid, Snapchat, sovereign wealth fund, special economic zone, stealth mode startup, stem cell, Stephen Hawking, Steve Jobs, Steven Pinker, Stewart Brand, supercomputer in your pocket, supply-chain management, technoutopianism, Tesla Model S, Tim Cook: Apple, transaction costs, Uber and Lyft, uber lyft, unbanked and underbanked, underbanked, urban planning, Watson beat the top human players on Jeopardy!, We wanted flying cars, instead we got 140 characters, X Prize

For more background on Brett Hagler’s company, New Story, see: Adele Peters, “There Will Soon Be a Whole Community of Ultra-Low-Cost 3-D-Printed Homes,” Fast Company, March 11, 2019, https://www.fastcompany.com/90317441/there-will-soon-be-a-whole-community-made-of-these-ultra-low-cost-3-D-printed-homes. In the fall of 2019, in Mexico: Ibid. Blockchain were first proposed in 1983: David Chaum, “Blind Signatures for Untraceable Payments,” Advances in Cryptography (Springer 1998), pp. 199–203 See: http://blog.koehntopp.de/uploads/Chaum.BlindSigForPayment.1982.PDF. Satoshi Nakamoto: Satoshi Nakamotoe, “Bitcoin: A Peer-to-Peer Electronic Cash System.” See: https://bitcoin.org/bitcoin.pdf. In 2010, Laszlo Hanyecz solved that problem: Nick Bilton, “Disruptions: Betting on a Coin with no Realm,” New York Times, December 22, 2013. By 2019, they were just shy of $15,000: Data retreived from: https://coinmarketcap.com/currencies/bitcoin/. $308 billion: “Billion Reasons to Bank Inclusively.”

After all, this is exactly how all other digital sharing works. When you send an email, your computer stores the original and sends a copy. This is fine for exchanging letters, but it’s lousy for trading money. This is the double-spending problem and it’s exactly what bitcoin was designed to solve. Bitcoin appeared in 2008, when an online paper authored by a still-anonymous person (or persons) calling themselves Satoshi Nakamoto proposed a digital peer-to-peer payment system that allows cash to be exchanged without the need for a financial institution. The following year, the first bitcoin software was made public, yet because the coins had only been mined but not traded, there was no way to assign them monetary value. In 2010, Laszlo Hanyecz solved that problem, buying two pizzas—costing $25—with 10,000 bitcoins.


pages: 50 words: 15,603

Orwell Versus the Terrorists: A Digital Short by Jamie Bartlett

augmented reality, barriers to entry, bitcoin, blockchain, crowdsourcing, cryptocurrency, Edward Snowden, Ethereum, ethereum blockchain, Kuwabatake Sanjuro: assassination market, Satoshi Nakamoto, technoutopianism, Zimmermann PGP

And there are even more revolutionary plans in the pipeline. An alternative way of organising the internet is being built as we speak, an internet where no one is in control, where no one can find you or shut you down, where no one can manipulate your content. A decentralised world that is both private and impossible to censor. Back in 2009, in an obscure cryptography chat forum, a mysterious man called Satoshi Nakamoto invented the crypto-currency Bitcoin.fn3 It turns out the real genius of Bitcoin was not the currency at all, but the way that it works. Bitcoin creates an immutable, unchangeable public copy of every transaction ever made by its users, which is hosted and verified by every computer that downloads the software. This public copy is called the ‘blockchain’. Pretty soon, enthusiasts figured out that the blockchain system could be used for anything.


pages: 477 words: 75,408

The Economic Singularity: Artificial Intelligence and the Death of Capitalism by Calum Chace

3D printing, additive manufacturing, agricultural Revolution, AI winter, Airbnb, artificial general intelligence, augmented reality, autonomous vehicles, banking crisis, basic income, Baxter: Rethink Robotics, Berlin Wall, Bernie Sanders, bitcoin, blockchain, call centre, Chris Urmson, congestion charging, credit crunch, David Ricardo: comparative advantage, Douglas Engelbart, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Flynn Effect, full employment, future of work, gender pay gap, gig economy, Google Glasses, Google X / Alphabet X, ImageNet competition, income inequality, industrial robot, Internet of things, invention of the telephone, invisible hand, James Watt: steam engine, Jaron Lanier, Jeff Bezos, job automation, John Markoff, John Maynard Keynes: technological unemployment, John von Neumann, Kevin Kelly, knowledge worker, lifelogging, lump of labour, Lyft, Marc Andreessen, Mark Zuckerberg, Martin Wolf, McJob, means of production, Milgram experiment, Narrative Science, natural language processing, new economy, Occupy movement, Oculus Rift, PageRank, pattern recognition, post scarcity, post-industrial society, post-work, precariat, prediction markets, QWERTY keyboard, railway mania, RAND corporation, Ray Kurzweil, RFID, Rodney Brooks, Sam Altman, Satoshi Nakamoto, Second Machine Age, self-driving car, sharing economy, Silicon Valley, Skype, software is eating the world, speech recognition, Stephen Hawking, Steve Jobs, TaskRabbit, technological singularity, The Future of Employment, Thomas Malthus, transaction costs, Tyler Cowen: Great Stagnation, Uber for X, uber lyft, universal basic income, Vernor Vinge, working-age population, Y Combinator, young professional

Blockchain People have gone mad trying to understand how the blockchain works, never mind trying to explain it. Its most famous application is Bitcoin, the world’s first completely decentralized digital currency.[cccxlix] In just a few years, the Bitcoin “economy” has grown larger than the economies of some countries. The value of a Bitcoin has fluctuated wildly, hitting a peak of $1,216 in November 2013. The insights which made Bitcoin possible were published in 2008 under the pseudonym Satoshi Nakamoto, and the blockchain is at the heart of it. The blockchain is a public ledger which records transactions. The clever bit is that the ledger is completely trustworthy despite having no central authority, like a bank, to validate it. It is trustworthy in that you can have full confidence that if someone gives you a Bitcoin, then you do own that Bitcoin: the person who gave it to you will not be nipping off to spend the same piece of currency elsewhere, even though it is entirely digital.

A problem is solved (“mined”) roughly every ten minutes, and each solution creates a block. The new block is added to the chain, and incorporates the transactions made since the last block was added to the chain. Your transaction is published on the blockchain’s network as soon as it is agreed, but it is only confirmed, and hence reliable, when a miner has incorporated it into a block. Satoshi Nakamoto’s innovation solved a previously intractable challenge in computer science known as the Byzantine General’s Problem. Imagine a mediaeval city surrounded by a dozen armies, each led by a powerful general. If the armies mount a co-ordinated attack, their victory is assured, but they can only communicate by messengers on horseback who visit the generals one by one, and some of the generals are untrustworthy.


pages: 267 words: 82,580

The Dark Net by Jamie Bartlett

3D printing, 4chan, bitcoin, blockchain, brain emulation, carbon footprint, creative destruction, crowdsourcing, cryptocurrency, deindustrialization, Edward Snowden, Filter Bubble, Francis Fukuyama: the end of history, global village, Google Chrome, Howard Rheingold, Internet of things, invention of writing, Johann Wolfgang von Goethe, Julian Assange, Kuwabatake Sanjuro: assassination market, life extension, litecoin, longitudinal study, Mark Zuckerberg, Marshall McLuhan, moral hazard, moral panic, Occupy movement, pre–internet, Ray Kurzweil, Ross Ulbricht, Satoshi Nakamoto, Skype, slashdot, technological singularity, technoutopianism, Ted Kaczynski, The Coming Technological Singularity, Turing test, Vernor Vinge, WikiLeaks, Zimmermann PGP

After Gilmore shut down the original mailing list, others sprang up in its place, with several dedicated to improving crypto. The most notable was the cryptography mailing list hosted by Perry Metzger, where many of the original cypherpunks migrated. But it also attracted a new generation who were just as keen to post papers and ideas about how to evade government surveillance and improve individual privacy online. In early 2008 a mysterious contributor to the cryptography mailing list called Satoshi Nakamoto posted a message that would change everything. To Calafou Six weeks after Amir’s talk, I find myself walking down a dusty hill and over a concrete bridge towards an enormous nineteenth-century textile factory complex. The words ‘Calafou: còlonia ecoindustrial postcapitalista’ are painted in large black and green letters on a wall outside. It’s mid-afternoon. I approach a bearded, long-haired man loitering by the entrance, and ask for Amir.

p.157 ‘However, researchers have found that . . .’ http://motherboard.vice.com/blog/bitcoin-isnt-the-criminal-safe-haven-people-think-it-is; http://anonymity-in-bitcoin.blogspot.com/2011/07/bitcoin-is-not-anonymous.html. p.157 ‘CoinJoin, for example, works . . .’ https://bitcointalk.org/index.php? topic=139581.0. p.158 ‘The future of these markets . . .’ http://www.chaum.com/articles/Security_Wthout_Identification.htm. This was what David Chaum – the inventor of digital cash twenty years before Satoshi Nakamoto – had in mind all along. In his 1985 book, Security without Identification: Transaction Systems to Make Big Brother Obsolete, he set out systems that could combine anonymity with secure payment. p.159 ‘Dark net markets have introduced . . .’ Hirschman, A., Exit Voice and Loyalty. p.160 ‘When Professor Nicolas Christin analysed . . .’ http://www.andrew.cmu.edu/user/nicolasc/publications/TR-CMU-CyLab-12-018.pdf.


pages: 326 words: 91,559

Everything for Everyone: The Radical Tradition That Is Shaping the Next Economy by Nathan Schneider

1960s counterculture, Affordable Care Act / Obamacare, Airbnb, altcoin, Amazon Mechanical Turk, back-to-the-land, basic income, Berlin Wall, Bernie Sanders, bitcoin, blockchain, Brewster Kahle, Burning Man, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, Clayton Christensen, collaborative economy, collective bargaining, Community Supported Agriculture, corporate governance, creative destruction, crowdsourcing, cryptocurrency, Debian, disruptive innovation, do-ocracy, Donald Knuth, Donald Trump, Edward Snowden, Elon Musk, Ethereum, ethereum blockchain, Food sovereignty, four colour theorem, future of work, gig economy, Google bus, hydraulic fracturing, Internet Archive, Jeff Bezos, jimmy wales, joint-stock company, Joseph Schumpeter, Julian Assange, Kickstarter, Lyft, M-Pesa, Marc Andreessen, Mark Zuckerberg, Marshall McLuhan, mass immigration, means of production, multi-sided market, new economy, offshore financial centre, old-boy network, Peter H. Diamandis: Planetary Resources, post-work, precariat, premature optimization, pre–internet, profit motive, race to the bottom, Richard Florida, Richard Stallman, ride hailing / ride sharing, Sam Altman, Satoshi Nakamoto, self-driving car, shareholder value, sharing economy, Silicon Valley, Slavoj Žižek, smart contracts, Steve Jobs, Steve Wozniak, Stewart Brand, transaction costs, Turing test, Uber and Lyft, uber lyft, underbanked, undersea cable, universal basic income, Upton Sinclair, Vanguard fund, white flight, Whole Earth Catalog, WikiLeaks, women in the workforce, working poor, Y Combinator, Y2K, Zipcar

Because of competition from faster, sleeker models already on the network, it could no longer mine enough bitcoins to pay for the electricity it burned. CoinTerra, the TerraMiner IV’s maker, filed for bankruptcy in early 2015. Like a used-up gold mine, the machine lent even the Bitcoin Center’s busiest evenings the sensation of a ghost town. Bitcoin was supposed to usher in a new global economy—gold for the internet age—and mining it was supposed to be an act of democracy. On February 11, 2009, Bitcoin’s pseudonymous creator, Satoshi Nakamoto, announced his invention in an online forum by explaining, “The root problem with conventional currency is all the trust that’s required to make it work.”4 This was just as the financial giants were breaching the world’s trust. At the time, only a month after Bitcoin’s initial “genesis block” went online, users could mine with an ordinary computer, though doing so was technically difficult and barely lucrative.

., The Scholastic Analysis of Usury (Harvard University Press, 1957); Jacques Le Goff, Your Money or Your Life: Economy and Religion in the Middle Ages (Zone Books, 1988). 2. See Nathan Schneider, “How a Worker-Owned Tech Startup Found Investors—and Kept Its Values,” YES! Magazine (April 26, 2016). 3. Credit Union National Association, “Credit Union Data and Statistics,” cuna.org/Research-And-Strategy/Credit-Union-Data-And-Statistics; CoBank, “About CoBank,” cobank.com/About-CoBank.aspx. 4. Satoshi Nakamoto, “Bitcoin Open Source Implementation of P2P Currency,” P2P Foundation Ning forum (February 11, 2009), p2pfoundation.ning.com/forum/topics/bitcoin-open-source; see also the original Bitcoin white paper at bitcoin.org/bitcoin.pdf; for a fuller account of the rise of Bitcoin, see Nathaniel Popper, Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money (Harper, 2015). 5.


pages: 366 words: 94,209

Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity by Douglas Rushkoff

activist fund / activist shareholder / activist investor, Airbnb, algorithmic trading, Amazon Mechanical Turk, Andrew Keen, bank run, banking crisis, barriers to entry, bitcoin, blockchain, Burning Man, business process, buy and hold, buy low sell high, California gold rush, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, centralized clearinghouse, citizen journalism, clean water, cloud computing, collaborative economy, collective bargaining, colonial exploitation, Community Supported Agriculture, corporate personhood, corporate raider, creative destruction, crowdsourcing, cryptocurrency, disintermediation, diversified portfolio, Elon Musk, Erik Brynjolfsson, Ethereum, ethereum blockchain, fiat currency, Firefox, Flash crash, full employment, future of work, gig economy, Gini coefficient, global supply chain, global village, Google bus, Howard Rheingold, IBM and the Holocaust, impulse control, income inequality, index fund, iterative process, Jaron Lanier, Jeff Bezos, jimmy wales, job automation, Joseph Schumpeter, Kickstarter, loss aversion, Lyft, Marc Andreessen, Mark Zuckerberg, market bubble, market fundamentalism, Marshall McLuhan, means of production, medical bankruptcy, minimum viable product, Mitch Kapor, Naomi Klein, Network effects, new economy, Norbert Wiener, Oculus Rift, passive investing, payday loans, peer-to-peer lending, Peter Thiel, post-industrial society, profit motive, quantitative easing, race to the bottom, recommendation engine, reserve currency, RFID, Richard Stallman, ride hailing / ride sharing, Ronald Reagan, Satoshi Nakamoto, Second Machine Age, shareholder value, sharing economy, Silicon Valley, Snapchat, social graph, software patent, Steve Jobs, TaskRabbit, The Future of Employment, trade route, transportation-network company, Turing test, Uber and Lyft, Uber for X, uber lyft, unpaid internship, Y Combinator, young professional, zero-sum game, Zipcar

Could a money system look and act less like iTunes and more like BitTorrent, where, instead of depending on a platform monopoly to negotiate everything, all the participants use protocols to interact with one another directly? Could a digital money system achieve with openness what traditional banks do with secrecy? The only way to find out is to start as openly as possible. That’s why Bitcoin first appeared as the subject of a 2008 white paper authored by someone (or multiple someones) going under the name Satoshi Nakamoto. The paper outlined a concept for a virtual currency created and traded on a peer-to-peer, open-source platform. It would need no central authority to issue it, nor any central middleman to verify or administer its transactions. The network platform would be called Bitcoin, and its currency would be called bitcoins.27 This idea was not entirely new. Virtual and decentralized currencies had been tried in the past.

David Wessel, “Lousy Economic Growth Is a Choice, Not an Inevitability,” brookings.edu, October 13, 2014. 24. Bernard Lietaer and Jacqui Dunne, Rethinking Money: How New Currencies Turn Scarcity into Prosperity (San Francisco: Berrett-Koehler Publishers, 2013). 25. Joanna Glasner, “PayPal’s IPO Woes Continue,” Wired, February 12, 2002. 26. In most of the world, that would be SWIFT. 27. Satoshi Nakamoto, “Bitcoin: A Peer-to-Peer Electronic Cash System,” bitcoin.org, October 31, 2008. 28. Ibid. 29. Pedro Franco, Understanding Bitcoin: Cryptography, Engineering and Economics (New York: John Wiley & Sons, 2014). 30. Ibid. 31. Andreas M. Antonopoulos, Mastering Bitcoin: Unlocking Digital Cryptocurrencies (Sebastopol, Calif.: O’Reilly Media, 2014). 32. Franco, Understanding Bitcoin. 33. Antonopoulos, Mastering Bitcoin. 34.


pages: 330 words: 91,805

Peers Inc: How People and Platforms Are Inventing the Collaborative Economy and Reinventing Capitalism by Robin Chase

Airbnb, Amazon Web Services, Andy Kessler, banking crisis, barriers to entry, basic income, Benevolent Dictator For Life (BDFL), bitcoin, blockchain, Burning Man, business climate, call centre, car-free, cloud computing, collaborative consumption, collaborative economy, collective bargaining, commoditize, congestion charging, creative destruction, crowdsourcing, cryptocurrency, decarbonisation, different worldview, do-ocracy, don't be evil, Elon Musk, en.wikipedia.org, Ethereum, ethereum blockchain, Ferguson, Missouri, Firefox, frictionless, Gini coefficient, hive mind, income inequality, index fund, informal economy, Intergovernmental Panel on Climate Change (IPCC), Internet of things, Jane Jacobs, Jeff Bezos, jimmy wales, job satisfaction, Kickstarter, Lean Startup, Lyft, means of production, megacity, Minecraft, minimum viable product, Network effects, new economy, Oculus Rift, openstreetmap, optical character recognition, pattern recognition, peer-to-peer, peer-to-peer lending, peer-to-peer model, Richard Stallman, ride hailing / ride sharing, Ronald Coase, Ronald Reagan, Satoshi Nakamoto, Search for Extraterrestrial Intelligence, self-driving car, shareholder value, sharing economy, Silicon Valley, six sigma, Skype, smart cities, smart grid, Snapchat, sovereign wealth fund, Steve Crocker, Steve Jobs, Steven Levy, TaskRabbit, The Death and Life of Great American Cities, The Future of Employment, The Nature of the Firm, transaction costs, Turing test, turn-by-turn navigation, Uber and Lyft, uber lyft, Zipcar

It provides a successful model for how Peers Inc networks can be entirely owned and governed by peer collaborators. Right now there is an explosion of ideas, innovation, invention, and excitement as a result of the Bitcoin experiment. People are applying the principles, code, and experience to arenas well beyond just currency, trying to solve many of the challenges raised in the second half of this book. Let’s start with a very brief background on Bitcoin. In 2008, Satoshi Nakamoto wrote a paper about a digital currency, called Bitcoin. “Satoshi Nakamoto” is a pseudonym, and no one knows whether it refers to a real person or a group of people. In 2009 their ideas were released as open-source software. (Note that this is yet another example where the concept and organizing principle of the platform were simply gifted out of thin air; that’s not a replicable strategy.) The Bitcoin software now exists as a platform and set of protocols for how to create, store, and use Bitcoins.


pages: 960 words: 125,049

Mastering Ethereum: Building Smart Contracts and DApps by Andreas M. Antonopoulos, Gavin Wood Ph. D.

Amazon Web Services, bitcoin, blockchain, continuous integration, cryptocurrency, Debian, domain-specific language, don't repeat yourself, Edward Snowden, en.wikipedia.org, Ethereum, ethereum blockchain, fault tolerance, fiat currency, Firefox, Google Chrome, intangible asset, Internet of things, litecoin, move fast and break things, move fast and break things, node package manager, peer-to-peer, Ponzi scheme, prediction markets, pull request, QR code, Ruby on Rails, Satoshi Nakamoto, sealed-bid auction, sharing economy, side project, smart contracts, transaction costs, Turing complete, Turing machine, Vickrey auction, web application, WebSocket

This can result, for example, in the theft of funds by skipping parts of the victim contract that update balances or count withdrawal amounts. Reward An amount of ether included in each new block as a reward by the network to the miner who found the proof-of-work solution. RLP Recursive Length Prefix. An encoding standard designed by the Ethereum developers to encode and serialize objects (data structures) of arbitrary complexity and length. Satoshi Nakamoto The name used by the person or people who designed Bitcoin, created its original reference implementation, and were the first to solve the double-spend problem for digital currency. Their real identity remains unknown. Secret key (aka private key) The secret number that allows Ethereum users to prove ownership of an account or contracts, by producing a digital signature (see “public key,” “address,” “ECDSA”).

Remote Procedure Call (RPC) commands (see JSON-RPC API) request-response oracles, Oracle Design Patterns require function, Error Handling (assert, require, revert) resolver contracts, Resolvers revert function, Error Handling (assert, require, revert) reward, defined, Quick Glossary RLP (Recursive Length Prefix), Quick Glossary, The Structure of a Transaction root seeds, creating HD wallets from, Creating an HD Wallet from the Seed Ropsten Test Network, Getting Some Test Ether RPC (Remote Procedure Call) commands (see JSON-RPC API) Rubixi pyramid scheme, Real-World Example: Rubixi runtime bytecode, Contract Deployment Code Rust, Software Requirements for Building and Running a Client (Node) S SafeMath library, Preventative Techniques salts, From mnemonic to seed Satoshi Nakamoto, Quick Glossary SchellingCoin protocol, Decentralized Oracles Schneier, Bruce, Cryptographic Hash Functions SECG (Standards for Efficient Cryptography Group), Generating a Public Key secp256k1 elliptic curve, Elliptic Curve Cryptography Explained-Elliptic Curve Cryptography Explained, Generating a Public Key, Elliptic Curve Libraries secret keys, Quick Glossary(see also private keys) Secure Hash Algorithm (see SHA entries) security (smart contracts), Smart Contract Security-Conclusionsarithmetic over/underflow threat, Arithmetic Over/Underflows-Real-World Examples: PoWHC and Batch Transfer Overflow (CVE-2018–10299) best practices, Security Best Practices block timestamp manipulation threat, Block Timestamp Manipulation-Real-World Example: GovernMental constructors and contract name-change threat, Constructors with Care contract libraries for, Contract Libraries default visibility specifier threat, Default Visibilities-Real-World Example: Parity Multisig Wallet (First Hack) DELEGATECALL opcode threat, DELEGATECALL-Real-World Example: Parity Multisig Wallet (Second Hack) denial of service attacks, Denial of Service (DoS)-Real-World Examples: GovernMental entropy illusion threat, Entropy Illusion external contract referencing threat, External Contract Referencing-Real-World Example: Reentrancy Honey Pot floating-point problem, Floating Point and Precision-Real-World Example: Ethstick race conditions/front running threat, Race Conditions/Front Running-Real-World Examples: ERC20 and Bancor reentrancy attacks, Reentrancy-Real-World Example: The DAO risks and antipatterns, Security Risks and Antipatterns-Preventative Techniques short address/parameter attack, Short Address/Parameter Attack token standard implementation choices, Security by Maturity tx.origin authentication threat, Tx.Origin Authentication-Preventative Techniques unchecked CALL return value threat, Unchecked CALL Return Values-Real-World Example: Etherpot and King of the Ether unexpected ether threat, Unexpected Ether-Further Examples uninitialized storage pointer threat, Uninitialized Storage Pointers-Real-World Examples: OpenAddressLottery and CryptoRoulette Honey Pots seeded wallets (see deterministic wallets) seeds, Quick Glossary(see also root seeds) deriving from mnemonic code words, From mnemonic to seed mnemonic code words for, Wallet Technology Overview, Seeds and Mnemonic Codes (BIP-39)(see also mnemonic code words) optional passphrase with, Optional passphrase in BIP-39 selfdestruct function, Contract Constructor and selfdestruct, The Vulnerability SELFDESTRUCT opcode, Life Cycle of a Smart Contract, Contract Constructor and selfdestruct semantic versioning, Selecting a Version of Solidity Serenity, Quick Glossary, Ethereum’s Four Stages of Development Serpent, Quick Glossary, Introduction to Ethereum High-Level Languages SGX (Software Guard eXtensions), Data Authentication SHA (Secure Hash Algorithm), Quick Glossary SHA-3 Hash Function, Ethereum’s Cryptographic Hash Function: Keccak-256 shell commands, Software Requirements for Building and Running a Client (Node) short address/parameter attack, Short Address/Parameter Attackpreventative techniques, Preventative Techniques vulnerability, The Vulnerability side effects, Introduction to Ethereum High-Level Languages single-instance private blockchain, Local Blockchain Simulation Advantages and Disadvantages singleton, Quick Glossary smart contracts, Smart Contracts and Solidity-ConclusionsABI, The Ethereum Contract ABI-Selecting a Solidity Compiler and Language Version addressing an existing instance, Addressing an existing instance and Ethereum high-level languages, Introduction to Ethereum High-Level Languages-Introduction to Ethereum High-Level Languages as DApp backend, Backend (Smart Contract), Auction DApp: Backend Smart Contracts-DApp governance basics, Externally Owned Accounts (EOAs) and Contracts building with Solidity, Building a Smart Contract with Solidity-Conclusions call method, Raw call, delegatecall-Raw call, delegatecall calling other contracts from within a contract, Calling Other Contracts (send, call, callcode, delegatecall)-Raw call, delegatecall constructor function, Contract Constructor and selfdestruct creating new instance, Creating a new instance defined, Quick Glossary, Quick Glossary, What Is a Smart Contract?


pages: 466 words: 127,728

The Death of Money: The Coming Collapse of the International Monetary System by James Rickards

Affordable Care Act / Obamacare, Asian financial crisis, asset allocation, Ayatollah Khomeini, bank run, banking crisis, Ben Bernanke: helicopter money, bitcoin, Black Swan, Bretton Woods, BRICs, business climate, business cycle, buy and hold, capital controls, Carmen Reinhart, central bank independence, centre right, collateralized debt obligation, collective bargaining, complexity theory, computer age, credit crunch, currency peg, David Graeber, debt deflation, Deng Xiaoping, diversification, Edward Snowden, eurozone crisis, fiat currency, financial innovation, financial intermediation, financial repression, fixed income, Flash crash, floating exchange rates, forward guidance, G4S, George Akerlof, global reserve currency, global supply chain, Growth in a Time of Debt, income inequality, inflation targeting, information asymmetry, invisible hand, jitney, John Meriwether, Kenneth Rogoff, labor-force participation, Lao Tzu, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, market clearing, market design, money market fund, money: store of value / unit of account / medium of exchange, mutually assured destruction, obamacare, offshore financial centre, oil shale / tar sands, open economy, plutocrats, Plutocrats, Ponzi scheme, price stability, quantitative easing, RAND corporation, reserve currency, risk-adjusted returns, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, Satoshi Nakamoto, Silicon Valley, Silicon Valley startup, Skype, sovereign wealth fund, special drawing rights, Stuxnet, The Market for Lemons, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, too big to fail, trade route, undersea cable, uranium enrichment, Washington Consensus, working-age population, yield curve

Other indications are anecdotal and difficult to quantify but are no less telling. Among them are the rise of alternative currencies and of virtual or digital currencies such as bitcoin. Digital currencies exist within private peer-to-peer computer networks and are not issued by or supported by any government or central bank. The bitcoin phenomenon began in 2008 with the pseudonymous publication of a paper (by Satoshi Nakamoto) describing the protocols for the creation of a new electronic digital currency. In January 2009 the first bitcoins were created by Nakamoto’s software. He continued making technical contributions to the bitcoin project until 2010, at which point he withdrew from active participation. However, by that time a large community of developers, libertarians, and entrepreneurs had taken up the project.

Employment Situation,” EconoMonitor, July 24, 2013, http://www.economonitor.com/danalperts2cents/2013/07/24/the-new-sick-onomy-examining-the-entrails-of-the-u-s-employment-situation. By August 2013, total student loans backed . . . : “The Rolling Student Loan Bailout,” Wall Street Journal, August 9, 2013, http://online.wsj.com/article/SB10001424127887323968704578652291680883634.html. “the test of a first-rate intelligence . . .”: F. Scott Fitzgerald, The Crack-Up (1936; reprint New York: New Directions, 2009). The bitcoin phenomenon began in 2008 . . . : Satoshi Nakamoto, “Bitcoin: A Peer-to-Peer Electronic Cash System,” November 1, 2008, http://bitcoin.org/bitcoin.pdf. the history of barter is mostly a myth: David Graeber, Debt: The First 5,000 Years (Brooklyn, N.Y.: Melville House, 2011), pp. 21–41. “Sept. 11 was not a failure of intelligence or coordination . . .”: Thomas L. Friedman, “A Failure to Imagine,” New York Times, May 19, 2002, http://www.nytimes.com/2002/05/19/opinion/a-failure-to-imagine.html.


pages: 170 words: 49,193

The People vs Tech: How the Internet Is Killing Democracy (And How We Save It) by Jamie Bartlett

Ada Lovelace, Airbnb, Amazon Mechanical Turk, Andrew Keen, autonomous vehicles, barriers to entry, basic income, Bernie Sanders, bitcoin, blockchain, Boris Johnson, central bank independence, Chelsea Manning, cloud computing, computer vision, creative destruction, cryptocurrency, Daniel Kahneman / Amos Tversky, Dominic Cummings, Donald Trump, Edward Snowden, Elon Musk, Filter Bubble, future of work, gig economy, global village, Google bus, hive mind, Howard Rheingold, information retrieval, Internet of things, Jeff Bezos, job automation, John Maynard Keynes: technological unemployment, Julian Assange, manufacturing employment, Mark Zuckerberg, Marshall McLuhan, Menlo Park, meta analysis, meta-analysis, mittelstand, move fast and break things, move fast and break things, Network effects, Nicholas Carr, off grid, Panopticon Jeremy Bentham, payday loans, Peter Thiel, prediction markets, QR code, ransomware, Ray Kurzweil, recommendation engine, Renaissance Technologies, ride hailing / ride sharing, Robert Mercer, Ross Ulbricht, Sam Altman, Satoshi Nakamoto, Second Machine Age, sharing economy, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, smart cities, smart contracts, smart meter, Snapchat, Stanford prison experiment, Steve Jobs, Steven Levy, strong AI, TaskRabbit, technological singularity, technoutopianism, Ted Kaczynski, the medium is the message, the scientific method, The Spirit Level, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, theory of mind, too big to fail, ultimatum game, universal basic income, WikiLeaks, World Values Survey, Y Combinator

Its technical design gives some clue as to why this might be. Before bitcoin, crypto-anarchists had for years been dreaming of decentralised anonymous payment systems. The cypherpunk email list discussed it frequently. When the list wound down at around the turn of the millennium, one of the members, Perry Metzger, set up a new cryptography forum to carry on these discussions. In late 2008, someone called Satoshi Nakamoto (in keeping with the crypto-anarchists’ love of anonymity, to date no one knows who he is) first posted his idea for bitcoin. Nakamoto distrusted the global banking system, and imagined bitcoin as a way to undermine it. He hated that bankers and governments held the key to the money supply and could manipulate it to their own ends. He placed a cap on the number of bitcoins that could ever be produced (21 million) and a timetable for how quickly they could be created.


pages: 499 words: 144,278

Coders: The Making of a New Tribe and the Remaking of the World by Clive Thompson

2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 4chan, 8-hour work day, Ada Lovelace, AI winter, Airbnb, Amazon Web Services, Asperger Syndrome, augmented reality, Ayatollah Khomeini, barriers to entry, basic income, Bernie Sanders, bitcoin, blockchain, blue-collar work, Brewster Kahle, Brian Krebs, Broken windows theory, call centre, cellular automata, Chelsea Manning, clean water, cloud computing, cognitive dissonance, computer vision, Conway's Game of Life, crowdsourcing, cryptocurrency, Danny Hillis, David Heinemeier Hansson, don't be evil, don't repeat yourself, Donald Trump, dumpster diving, Edward Snowden, Elon Musk, Erik Brynjolfsson, Ernest Rutherford, Ethereum, ethereum blockchain, Firefox, Frederick Winslow Taylor, game design, glass ceiling, Golden Gate Park, Google Hangouts, Google X / Alphabet X, Grace Hopper, Guido van Rossum, Hacker Ethic, HyperCard, illegal immigration, ImageNet competition, Internet Archive, Internet of things, Jane Jacobs, John Markoff, Jony Ive, Julian Assange, Kickstarter, Larry Wall, lone genius, Lyft, Marc Andreessen, Mark Shuttleworth, Mark Zuckerberg, Menlo Park, microservices, Minecraft, move fast and break things, move fast and break things, Nate Silver, Network effects, neurotypical, Nicholas Carr, Oculus Rift, PageRank, pattern recognition, Paul Graham, paypal mafia, Peter Thiel, pink-collar, planetary scale, profit motive, ransomware, recommendation engine, Richard Stallman, ride hailing / ride sharing, Rubik’s Cube, Ruby on Rails, Sam Altman, Satoshi Nakamoto, Saturday Night Live, self-driving car, side project, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, single-payer health, Skype, smart contracts, Snapchat, social software, software is eating the world, sorting algorithm, South of Market, San Francisco, speech recognition, Steve Wozniak, Steven Levy, TaskRabbit, the High Line, Travis Kalanick, Uber and Lyft, Uber for X, uber lyft, universal basic income, urban planning, Wall-E, Watson beat the top human players on Jeopardy!, WikiLeaks, women in the workforce, Y Combinator, Zimmermann PGP, éminence grise

An early and influential blogging tool, LiveJournal, was written by Brad Fitzpatrick. The breakthrough search algorithm that led to Google was a product of two students, Larry Page and Sergey Brin; YouTube was a trio of coworkers; Snapchat a trio (or, the level of the code, one person, Bobby Murphy). BitTorrent was entirely a creation of Bram Cohen, and Bitcoin was reputedly the work of a lone coder, the pseudonymous “Satoshi Nakamoto.” John Carmack created the 3-D-graphics engines that helped usher in the multi-billion-dollar industry of first-person shooter video games. The reason so few people can have such an outsize impact, Andreessen argues, is that when you’re creating a weird new prototype of an app, the mental castle building is most efficiently done inside one or two isolated brains. The 10X productivity comes from being in the zone and staying there and from having a remarkable ability to visualize a complex architecture.

trio of coworkers: Laura Fitzpatrick, “Brief History of YouTube,” Time, May 31, 2010, accessed August 18, 2018, http://content.time.com/time/magazine/article/0,9171,1990787,00.html. one person, Bobby Murphy: Alex Hern, “Snapchat Boss Evan Spiegel on the App That Made Him One of the World’s Youngest Billionaires,” Guardian, December 5, 2017, https://www.theguardian.com/technology/2017/dec/05/snapchat-boss-evan-spiegel-on-the-app-that-made-him-one-of-the-worlds-youngest-billionaires. the pseudonymous “Satoshi Nakamoto”: Joshua Davis, “The Crypto-Currency,” New Yorker, October 10, 2011, accessed August 18, 2018, https://www.newyorker.com/magazine/2011/10/10/the-crypto-currency. first-person shooter video games: Chris Kohler, “Q&A: Doom’s Creator Looks Back on 20 Years of Demonic Mayhem,” Wired, December 10, 2013, accessed August 18, 2018, https://www.wired.com/2013/12/john-carmack-doom. “‘QA team put together’”: Joel Spolsky, “Top Five (Wrong) Reasons You Don’t Have Testers,” Joel on Software (blog), April 30, 2000, accessed August 18, 2018, https://www.joelonsoftware.com/2000/04/30/top-five-wrong-reasons-you-dont-have-testers.


pages: 430 words: 68,225

Blockchain Basics: A Non-Technical Introduction in 25 Steps by Daniel Drescher

bitcoin, blockchain, business process, central bank independence, collaborative editing, cryptocurrency, disintermediation, disruptive innovation, distributed ledger, Ethereum, ethereum blockchain, fiat currency, job automation, linked data, peer-to-peer, place-making, Satoshi Nakamoto, smart contracts, transaction costs

The Usage of the Term in This Book Throughout the rest of this book, blockchain refers to the shortcut for the umbrella term for purely distributed peer-to-peer systems of ledgers that utilize the blockchain-technology-suite. If any other meaning is intended, I will indicate this by explicitly using the term blockchain-data-structure, blockchain-algorithm, or blockchain-technology-suite. ■ Note The technology that is nowadays regarded as blockchain was proposed in 2008 under the pseudonym Satoshi Nakamoto,1 whose true identity has not yet been revealed. Provisional Definition The following definition is not complete. It still lacks important details that have not yet been presented. However, this definition serves as an intermedi- ate step toward a more complete understanding of the term: The blockchain is a purely distributed peer-to-peer system of ledgers that utilizes a software unit that consist of an algorithm, which negotiates the informational content of ordered and connected blocks of data together with cryptographic and security technologies in order to achieve and maintain its integrity.


pages: 237 words: 64,411

Humans Need Not Apply: A Guide to Wealth and Work in the Age of Artificial Intelligence by Jerry Kaplan

Affordable Care Act / Obamacare, Amazon Web Services, asset allocation, autonomous vehicles, bank run, bitcoin, Bob Noyce, Brian Krebs, business cycle, buy low sell high, Capital in the Twenty-First Century by Thomas Piketty, combinatorial explosion, computer vision, corporate governance, crowdsourcing, en.wikipedia.org, Erik Brynjolfsson, estate planning, Flash crash, Gini coefficient, Goldman Sachs: Vampire Squid, haute couture, hiring and firing, income inequality, index card, industrial robot, information asymmetry, invention of agriculture, Jaron Lanier, Jeff Bezos, job automation, John Markoff, John Maynard Keynes: Economic Possibilities for our Grandchildren, Loebner Prize, Mark Zuckerberg, mortgage debt, natural language processing, Own Your Own Home, pattern recognition, Satoshi Nakamoto, school choice, Schrödinger's Cat, Second Machine Age, self-driving car, sentiment analysis, Silicon Valley, Silicon Valley startup, Skype, software as a service, The Chicago School, The Future of Employment, Turing test, Watson beat the top human players on Jeopardy!, winner-take-all economy, women in the workforce, working poor, Works Progress Administration

As we learn to trust these systems to transport us, introduce us to potential mates, customize our news, protect our property, monitor our environment, grow, prepare, and serve our food, teach our children, and care for our elderly, it will be easy to miss the bigger picture. They will offer us the minimum required to keep us satisfied while pocketing the excess profits, just as any smart businessperson does. The first glimmers of this are already visible. Bitcoins, for instance. It’s a new currency that exists solely in cyberspace and isn’t controlled by anyone. It was invented by an anonymous person or entity named Satoshi Nakamoto. No one may know who—or what—he is, but it’s clear that he doesn’t control the production, management, or value of his creation. Despite halfhearted attempts to regulate or legitimize bitcoins, neither do governments. Or anyone else, for that matter. As long as they can be converted to and from other assets of value—whether legally or illegally anywhere in the world—bitcoins will continue to exist and find adherents.


pages: 261 words: 86,905

How to Speak Money: What the Money People Say--And What It Really Means by John Lanchester

asset allocation, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, blood diamonds, Bretton Woods, BRICs, business cycle, Capital in the Twenty-First Century by Thomas Piketty, Celtic Tiger, central bank independence, collapse of Lehman Brothers, collective bargaining, commoditize, creative destruction, credit crunch, Credit Default Swap, crony capitalism, Dava Sobel, David Graeber, disintermediation, double entry bookkeeping, en.wikipedia.org, estate planning, financial innovation, Flash crash, forward guidance, Gini coefficient, global reserve currency, high net worth, High speed trading, hindsight bias, income inequality, inflation targeting, interest rate swap, Isaac Newton, Jaron Lanier, joint-stock company, joint-stock limited liability company, Kodak vs Instagram, liquidity trap, London Interbank Offered Rate, London Whale, loss aversion, margin call, McJob, means of production, microcredit, money: store of value / unit of account / medium of exchange, moral hazard, Myron Scholes, negative equity, neoliberal agenda, New Urbanism, Nick Leeson, Nikolai Kondratiev, Nixon shock, Northern Rock, offshore financial centre, oil shock, open economy, paradox of thrift, plutocrats, Plutocrats, Ponzi scheme, purchasing power parity, pushing on a string, quantitative easing, random walk, rent-seeking, reserve currency, Richard Feynman, Right to Buy, road to serfdom, Ronald Reagan, Satoshi Nakamoto, security theater, shareholder value, Silicon Valley, six sigma, Social Responsibility of Business Is to Increase Its Profits, South Sea Bubble, sovereign wealth fund, Steve Jobs, survivorship bias, The Chicago School, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, trickle-down economics, Washington Consensus, wealth creators, working poor, yield curve

There used to be something called the Mars bar index, which tried to do something similar with the effect of inflation in the UK, but one of the problems with it is that Mars bars (unlike Big Macs) have changed size over time.21 See if, without looking at it, you can guess the most and least expensive countries in the world. Answer: Norway and Venezuela are the most expensive, and India and South Africa the least—though the Indian Big Mac is called the Maharaja Mac, and is made of chicken. If you’re wondering what Norway and Venuezuela have in common, the answer is nothing, except lots of oil. bitcoin An unregulated currency, created by someone or someones calling him, her, or themselves Satoshi Nakamoto, in 2008. It has no inherent value, so its worth depends entirely on the trust people have in it: in my view, that’s the most interesting thing about bitcoin, the fact it is a built-in lesson on the arbitrary nature of money values. Bitcoins are created by “mining,” i.e., by long slow computer calculations, and are stored and exchanged via digital “wallets.” This number crunching burns a lot of energy, and the cost of that energy is the real cost of creating bitcoins.


pages: 285 words: 86,853

What Algorithms Want: Imagination in the Age of Computing by Ed Finn

Airbnb, Albert Einstein, algorithmic trading, Amazon Mechanical Turk, Amazon Web Services, bitcoin, blockchain, Chuck Templeton: OpenTable:, Claude Shannon: information theory, commoditize, Credit Default Swap, crowdsourcing, cryptocurrency, disruptive innovation, Donald Knuth, Douglas Engelbart, Douglas Engelbart, Elon Musk, factory automation, fiat currency, Filter Bubble, Flash crash, game design, Google Glasses, Google X / Alphabet X, High speed trading, hiring and firing, invisible hand, Isaac Newton, iterative process, Jaron Lanier, Jeff Bezos, job automation, John Conway, John Markoff, Just-in-time delivery, Kickstarter, late fees, lifelogging, Loebner Prize, Lyft, Mother of all demos, Nate Silver, natural language processing, Netflix Prize, new economy, Nicholas Carr, Norbert Wiener, PageRank, peer-to-peer, Peter Thiel, Ray Kurzweil, recommendation engine, Republic of Letters, ride hailing / ride sharing, Satoshi Nakamoto, self-driving car, sharing economy, Silicon Valley, Silicon Valley ideology, Silicon Valley startup, social graph, software studies, speech recognition, statistical model, Steve Jobs, Steven Levy, Stewart Brand, supply-chain management, TaskRabbit, technological singularity, technoutopianism, The Coming Technological Singularity, the scientific method, The Signal and the Noise by Nate Silver, The Structural Transformation of the Public Sphere, The Wealth of Nations by Adam Smith, transaction costs, traveling salesman, Turing machine, Turing test, Uber and Lyft, Uber for X, uber lyft, urban planning, Vannevar Bush, Vernor Vinge, wage slave

The very success of this arbitrage sea change has accentuated the objections of those who see the digital transactions we all participate in not as matters of convenience—free services provided in exchange for viewing a few targeted ads, for example—but as the radical evisceration of individual privacy and autonomy for the sake of new collective, algorithmically engineered systems of value. Perhaps the single greatest example of this ideological reaction is the rapid popularization of a new cryptocurrency called Bitcoin. Bitcoin first emerged as a paper published in November 2008 by the apparently fictional mathematician Satoshi Nakamoto (about ten years after Schwartz predicted e-cash would become mainstream). In the paper Nakamoto argued for a new financial model that would eliminate the key vulnerability of traditional financial systems: “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.”24 The straightforward paper describes a system for exchanging currency based purely on computing power and mathematics (which I describe in more detail below), with no dependence on a central bank, a formal issuing authority, or other “faith and credit” standards of traditional currencies.


pages: 378 words: 94,468

Drugs 2.0: The Web Revolution That's Changing How the World Gets High by Mike Power

air freight, Alexander Shulgin, banking crisis, bitcoin, blockchain, Buckminster Fuller, Burning Man, cloud computing, credit crunch, crowdsourcing, death of newspapers, Donald Davies, double helix, Douglas Engelbart, Electric Kool-Aid Acid Test, fiat currency, Firefox, Fractional reserve banking, frictionless, Haight Ashbury, John Bercow, John Markoff, Kevin Kelly, Leonard Kleinrock, means of production, Menlo Park, moral panic, Mother of all demos, Network effects, nuclear paranoia, packet switching, pattern recognition, PIHKAL and TIHKAL, pre–internet, QR code, RAND corporation, Satoshi Nakamoto, selective serotonin reuptake inhibitor (SSRI), sexual politics, Skype, Stephen Hawking, Steve Jobs, Stewart Brand, trade route, Whole Earth Catalog, Zimmermann PGP

Using bitcoins can be, depending on how you use them, almost completely anonymous. Originally, bitcoins were produced by ‘miners’ – a figurative term for computer owners who donated their processor time to the project and were rewarded with coins for their efforts. The currency, or rather, the system that creates the currency, was released to the web on 1 November 2008, as the world economic system teetered on the brink of systemic collapse. Anonymous software coder Satoshi Nakamoto issued the open source application, and included a sly reference to the latest banking bailout by Britain’s then-chancellor of the exchequer, Alistair Darling, buried in code for the so-called Genesis Block – the first coins ever ‘mined’, in January 2009.4 The main reason no purely digital currency has ever gained traction is because data-as-cash has a central flaw. As the music industry has discovered in recent years, digital information is infinitely copyable.


pages: 385 words: 111,113

Augmented: Life in the Smart Lane by Brett King

23andMe, 3D printing, additive manufacturing, Affordable Care Act / Obamacare, agricultural Revolution, Airbnb, Albert Einstein, Amazon Web Services, Any sufficiently advanced technology is indistinguishable from magic, Apple II, artificial general intelligence, asset allocation, augmented reality, autonomous vehicles, barriers to entry, bitcoin, blockchain, business intelligence, business process, call centre, chief data officer, Chris Urmson, Clayton Christensen, clean water, congestion charging, crowdsourcing, cryptocurrency, deskilling, different worldview, disruptive innovation, distributed generation, distributed ledger, double helix, drone strike, Elon Musk, Erik Brynjolfsson, Fellow of the Royal Society, fiat currency, financial exclusion, Flash crash, Flynn Effect, future of work, gig economy, Google Glasses, Google X / Alphabet X, Hans Lippershey, Hyperloop, income inequality, industrial robot, information asymmetry, Internet of things, invention of movable type, invention of the printing press, invention of the telephone, invention of the wheel, James Dyson, Jeff Bezos, job automation, job-hopping, John Markoff, John von Neumann, Kevin Kelly, Kickstarter, Kodak vs Instagram, Leonard Kleinrock, lifelogging, low earth orbit, low skilled workers, Lyft, M-Pesa, Mark Zuckerberg, Marshall McLuhan, megacity, Metcalfe’s law, Minecraft, mobile money, money market fund, more computing power than Apollo, Network effects, new economy, obamacare, Occupy movement, Oculus Rift, off grid, packet switching, pattern recognition, peer-to-peer, Ray Kurzweil, RFID, ride hailing / ride sharing, Robert Metcalfe, Satoshi Nakamoto, Second Machine Age, selective serotonin reuptake inhibitor (SSRI), self-driving car, sharing economy, Shoshana Zuboff, Silicon Valley, Silicon Valley startup, Skype, smart cities, smart grid, smart transportation, Snapchat, social graph, software as a service, speech recognition, statistical model, stem cell, Stephen Hawking, Steve Jobs, Steve Wozniak, strong AI, TaskRabbit, technological singularity, telemarketer, telepresence, telepresence robot, Tesla Model S, The Future of Employment, Tim Cook: Apple, trade route, Travis Kalanick, Turing complete, Turing test, uber lyft, undersea cable, urban sprawl, V2 rocket, Watson beat the top human players on Jeopardy!, white picket fence, WikiLeaks

Buncombe, “Pakistani court declares US drone strikes in the country’s tribal belt illegal,” Independent, 9 May 2013. 12 http://www.nest.com Chapter 9 Smart Banking, Payments and Money “The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” Satoshi Nakamoto, pseudonym of the anonymous creator of Bitcoin The evolution of banking and payments has often been correlated with technological advancement. Today, the primary method of transferring money between banks globally is a transaction called a wire transfer or telegraphic transfer, so named because the instructions for these transfers were sent via telegraph or “wire” initially, then later by Telex and now via interbank electronic networks like SWIFT.1 The first mainframe computer ever built was for a bank, too.


pages: 349 words: 109,304

American Kingpin: The Epic Hunt for the Criminal Mastermind Behind the Silk Road by Nick Bilton

bitcoin, blockchain, crack epidemic, Edward Snowden, mandatory minimum, Marc Andreessen, Mark Zuckerberg, Ross Ulbricht, Rubik’s Cube, Satoshi Nakamoto, side project, Silicon Valley, Skype, South of Market, San Francisco, Steve Jobs, Ted Kaczynski, the market place, trade route, Travis Kalanick, white picket fence, WikiLeaks

Before arriving, Gary had done his homework, scouring news articles, forum posts by the Dread Pirate Roberts, and research about the Dark Web, all to get acquainted with the case he was about to join. While reading these pieces, Gary had come across the first white paper that had been published about Bitcoin, written by the creator of the digital currency, an anonymous man who went by the pseudonym Satoshi Nakamoto. Gary read the paper once and nothing stood out. He read it a second time, and still nothing. But the third time he noticed something, in a section of the paper that referenced the “Gambler’s Ruin problem,” a theory that no matter how much money you have in a betting scenario, the casino (or house) has an infinite amount of money, and therefore, if you keep making bets, the house will eventually win.


pages: 349 words: 114,038

Culture & Empire: Digital Revolution by Pieter Hintjens

4chan, airport security, AltaVista, anti-communist, anti-pattern, barriers to entry, Bill Duvall, bitcoin, blockchain, business climate, business intelligence, business process, Chelsea Manning, clean water, commoditize, congestion charging, Corn Laws, correlation does not imply causation, cryptocurrency, Debian, Edward Snowden, failed state, financial independence, Firefox, full text search, German hyperinflation, global village, GnuPG, Google Chrome, greed is good, Hernando de Soto, hiring and firing, informal economy, intangible asset, invisible hand, James Watt: steam engine, Jeff Rulifson, Julian Assange, Kickstarter, M-Pesa, mass immigration, mass incarceration, mega-rich, MITM: man-in-the-middle, mutually assured destruction, Naomi Klein, national security letter, Nelson Mandela, new economy, New Urbanism, Occupy movement, offshore financial centre, packet switching, patent troll, peak oil, pre–internet, private military company, race to the bottom, rent-seeking, reserve currency, RFC: Request For Comment, Richard Feynman, Richard Stallman, Ross Ulbricht, Satoshi Nakamoto, security theater, selection bias, Skype, slashdot, software patent, spectrum auction, Steve Crocker, Steve Jobs, Steven Pinker, Stuxnet, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, trade route, transaction costs, twin studies, union organizing, wealth creators, web application, WikiLeaks, Y2K, zero day, Zipf's Law

In the beginning, when transaction chains were short, they were easy to process, and people could mine thousands of coins on their PCs. Today, as chains are long, it takes more effort to mine coins. Every year, the number of coins that can be mined falls, so at some point there will be no new BitCoins. The BitCoin design and open source software was written by a prudently anonymous team calling themselves "Satoshi Nakamoto." They took some existing concepts from the cryptographic community, and invented some new ones. The technology had one major vulnerability, which was fixed in 2010. Since then, it appears robust. BitCoin satisfies most of the criteria for use as a medium of digital trade. It is free from coercion by authorities. The transaction fees are paid in the form of computing power used to verify blocks and network bandwidth to exchange chains with others.


pages: 421 words: 110,406

Platform Revolution: How Networked Markets Are Transforming the Economy--And How to Make Them Work for You by Sangeet Paul Choudary, Marshall W. van Alstyne, Geoffrey G. Parker

3D printing, Affordable Care Act / Obamacare, Airbnb, Alvin Roth, Amazon Mechanical Turk, Amazon Web Services, Andrei Shleifer, Apple's 1984 Super Bowl advert, autonomous vehicles, barriers to entry, big data - Walmart - Pop Tarts, bitcoin, blockchain, business cycle, business process, buy low sell high, chief data officer, Chuck Templeton: OpenTable:, clean water, cloud computing, connected car, corporate governance, crowdsourcing, data acquisition, data is the new oil, digital map, discounted cash flows, disintermediation, Edward Glaeser, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, financial innovation, Haber-Bosch Process, High speed trading, information asymmetry, Internet of things, inventory management, invisible hand, Jean Tirole, Jeff Bezos, jimmy wales, John Markoff, Khan Academy, Kickstarter, Lean Startup, Lyft, Marc Andreessen, market design, Metcalfe’s law, multi-sided market, Network effects, new economy, payday loans, peer-to-peer lending, Peter Thiel, pets.com, pre–internet, price mechanism, recommendation engine, RFID, Richard Stallman, ride hailing / ride sharing, Robert Metcalfe, Ronald Coase, Satoshi Nakamoto, self-driving car, shareholder value, sharing economy, side project, Silicon Valley, Skype, smart contracts, smart grid, Snapchat, software is eating the world, Steve Jobs, TaskRabbit, The Chicago School, the payments system, Tim Cook: Apple, transaction costs, Travis Kalanick, two-sided market, Uber and Lyft, Uber for X, uber lyft, winner-take-all economy, zero-sum game, Zipcar

To solve this problem, competing exchanges, such as the alternative trading system IEX, are using their own supercomputers to precisely time the order of bids, thereby eliminating the advantages of a Goldman Sachs.36 Architecture can level the playing field, making markets more competitive and fair for all. One of the most innovative forms of architectural control ever invented made its appearance in 2008, when an anonymous coding genius known as Satoshi Nakamoto published a paper on the Cryptography mailing list defining the Bitcoin digital currency and the so-called blockchain protocol governing it. Although Bitcoin is notable as the world’s first unforgeable digital currency that cannot be controlled by a government, bank, or individual, the blockchain is truly revolutionary. It makes possible fully decentralized, completely trustworthy interactions without any need for escrow payments or other guarantees.


pages: 390 words: 109,870

Radicals Chasing Utopia: Inside the Rogue Movements Trying to Change the World by Jamie Bartlett

Andrew Keen, back-to-the-land, Bernie Sanders, bitcoin, blockchain, blue-collar work, Boris Johnson, brain emulation, centre right, clean water, cryptocurrency, Donald Trump, drone strike, Elon Musk, energy security, Ethereum, ethereum blockchain, failed state, gig economy, hydraulic fracturing, income inequality, Intergovernmental Panel on Climate Change (IPCC), Jaron Lanier, job automation, John Markoff, Joseph Schumpeter, Kickstarter, life extension, Occupy movement, off grid, Peter Thiel, post-industrial society, postnationalism / post nation state, precariat, QR code, Ray Kurzweil, RFID, Rosa Parks, Ross Ulbricht, Satoshi Nakamoto, self-driving car, Silicon Valley, Silicon Valley startup, Skype, smart contracts, stem cell, Stephen Hawking, Steve Jobs, Steven Pinker, technoutopianism

There is, at the time of writing, a major divide in the bitcoin community between those who want to make the system more efficient by executing more transactions per block, which requires a major redesign, and those who reject the idea as being too centralised. The blocks of transactions would need to get very large indeed, otherwise they will start queuing up. Because the designer and creator of bitcoin, Satoshi Nakamoto, decided to cap the size of a block at one megabyte, or about 1,400 transactions, it can handle only around seven transactions per second, compared to the 1,736 a second Visa handles in America. Blocks could be made bigger, but bigger blocks would take longer to propagate through the network, worsening the risks of forking. Many people assume bitcoin to be completely decentralised, but if a miner, or a group of miners, controlled over half the computing power that works on verifying the transaction, it could feasibly force a change on the blockchain transaction list however it wished, create a fork of the blockchain, and all the other computers would start to work on the new version (the protocol is written so that all computers work from the longest blockchain).


pages: 492 words: 118,882

The Blockchain Alternative: Rethinking Macroeconomic Policy and Economic Theory by Kariappa Bheemaiah

accounting loophole / creative accounting, Ada Lovelace, Airbnb, algorithmic trading, asset allocation, autonomous vehicles, balance sheet recession, bank run, banks create money, Basel III, basic income, Ben Bernanke: helicopter money, bitcoin, blockchain, Bretton Woods, business cycle, business process, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, cashless society, cellular automata, central bank independence, Claude Shannon: information theory, cloud computing, cognitive dissonance, collateralized debt obligation, commoditize, complexity theory, constrained optimization, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crowdsourcing, cryptocurrency, David Graeber, deskilling, Diane Coyle, discrete time, disruptive innovation, distributed ledger, diversification, double entry bookkeeping, Ethereum, ethereum blockchain, fiat currency, financial innovation, financial intermediation, Flash crash, floating exchange rates, Fractional reserve banking, full employment, George Akerlof, illegal immigration, income inequality, income per capita, inflation targeting, information asymmetry, interest rate derivative, inventory management, invisible hand, John Maynard Keynes: technological unemployment, John von Neumann, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, Kevin Kelly, knowledge economy, large denomination, liquidity trap, London Whale, low skilled workers, M-Pesa, Marc Andreessen, market bubble, market fundamentalism, Mexican peso crisis / tequila crisis, MITM: man-in-the-middle, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, natural language processing, Network effects, new economy, Nikolai Kondratiev, offshore financial centre, packet switching, Pareto efficiency, pattern recognition, peer-to-peer lending, Ponzi scheme, precariat, pre–internet, price mechanism, price stability, private sector deleveraging, profit maximization, QR code, quantitative easing, quantitative trading / quantitative finance, Ray Kurzweil, Real Time Gross Settlement, rent control, rent-seeking, Satoshi Nakamoto, Satyajit Das, savings glut, seigniorage, Silicon Valley, Skype, smart contracts, software as a service, software is eating the world, speech recognition, statistical model, Stephen Hawking, supply-chain management, technology bubble, The Chicago School, The Future of Employment, The Great Moderation, the market place, The Nature of the Firm, the payments system, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, trade liberalization, transaction costs, Turing machine, Turing test, universal basic income, Von Neumann architecture, Washington Consensus

It could be the lights around you, the tablet on which you read this book, or your smartphone that is attached to you at all times. Now that you have selected a technology, dissect it completely and trace back the origin of every piece of technology that it embeds. You will find that in every case, the technology you are analyzing could not have existed had it not been for a government grant. This is true even of the Blockchain. While the Blockchain was first created by a single person/group (Satoshi Nakamoto), what it represents is decades’ worth of research and development in cryptography, encryption, economics, and game theory—all subjects that have been funded massively by governments. Had it not been for the ARPANet, Vint Cerf and Bob Khan would have never received the necessary funding to develop packetswitching data and you would not be reading this book had that happened. The development of technology is hence a collective production of wealth and it is for this reason that we need to turn the narrative of capitalism and show that there is no separation between free markets and the state.


pages: 464 words: 139,088

The End of Alchemy: Money, Banking and the Future of the Global Economy by Mervyn King

"Robert Solow", Andrei Shleifer, Asian financial crisis, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, Bretton Woods, British Empire, business cycle, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, centre right, collapse of Lehman Brothers, creative destruction, Credit Default Swap, crowdsourcing, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, distributed generation, Doha Development Round, Edmond Halley, Fall of the Berlin Wall, falling living standards, fiat currency, financial innovation, financial intermediation, floating exchange rates, forward guidance, Fractional reserve banking, Francis Fukuyama: the end of history, full employment, German hyperinflation, Hyman Minsky, inflation targeting, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Meriwether, joint-stock company, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, labour market flexibility, large denomination, lateral thinking, liquidity trap, Long Term Capital Management, manufacturing employment, market clearing, Martin Wolf, Mexican peso crisis / tequila crisis, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, Myron Scholes, Nick Leeson, North Sea oil, Northern Rock, oil shale / tar sands, oil shock, open economy, paradox of thrift, Paul Samuelson, Ponzi scheme, price mechanism, price stability, purchasing power parity, quantitative easing, rent-seeking, reserve currency, Richard Thaler, rising living standards, Robert Shiller, Robert Shiller, Satoshi Nakamoto, savings glut, secular stagnation, seigniorage, stem cell, Steve Jobs, The Great Moderation, the payments system, The Rise and Fall of American Growth, Thomas Malthus, too big to fail, transaction costs, Tyler Cowen: Great Stagnation, yield curve, Yom Kippur War, zero-sum game

Even old-fashioned bank robberies are diminishing – they almost halved in the US between 2004 and 2014 – to be replaced by an explosion of cybercrime.34 At present, electronic transfers simply move money from one bank account to another – convenient but not revolutionary – and banks then clear payments with each other through their own accounts at the central bank. In principle, two parties engaged in a transaction could instead settle directly by a transfer of money from one electronic account to another in ‘real time’. A step in that direction was the creation of bitcoin – a ‘virtual’ currency launched in 2009, allegedly by one or more individuals under the pseudonym of Satoshi Nakamoto. Ownership of bitcoins is transferred through bilateral transactions without the need for verification by a third party (necessary in all other current electronic payment systems). Transactions are verified by the use of a software accounting system accessible to all users.35 The supply of bitcoins is governed by an algorithm embodied in the software that runs the system (with a maximum number of twenty-one million).


pages: 474 words: 130,575

Surveillance Valley: The Rise of the Military-Digital Complex by Yasha Levine

23andMe, activist fund / activist shareholder / activist investor, Airbnb, AltaVista, Amazon Web Services, Anne Wojcicki, anti-communist, Apple's 1984 Super Bowl advert, bitcoin, borderless world, British Empire, call centre, Chelsea Manning, cloud computing, collaborative editing, colonial rule, computer age, computerized markets, corporate governance, crowdsourcing, cryptocurrency, digital map, don't be evil, Donald Trump, Douglas Engelbart, Douglas Engelbart, drone strike, Edward Snowden, El Camino Real, Electric Kool-Aid Acid Test, Elon Musk, fault tolerance, George Gilder, ghettoisation, global village, Google Chrome, Google Earth, Google Hangouts, Howard Zinn, hypertext link, IBM and the Holocaust, index card, Jacob Appelbaum, Jeff Bezos, jimmy wales, John Markoff, John von Neumann, Julian Assange, Kevin Kelly, Kickstarter, life extension, Lyft, Mark Zuckerberg, market bubble, Menlo Park, Mitch Kapor, natural language processing, Network effects, new economy, Norbert Wiener, packet switching, PageRank, Paul Buchheit, peer-to-peer, Peter Thiel, Philip Mirowski, plutocrats, Plutocrats, private military company, RAND corporation, Ronald Reagan, Ross Ulbricht, Satoshi Nakamoto, self-driving car, sentiment analysis, shareholder value, side project, Silicon Valley, Silicon Valley startup, Skype, slashdot, Snapchat, speech recognition, Steve Jobs, Steve Wozniak, Steven Levy, Stewart Brand, Telecommunications Act of 1996, telepresence, telepresence robot, The Bell Curve by Richard Herrnstein and Charles Murray, The Hackers Conference, uber lyft, Whole Earth Catalog, Whole Earth Review, WikiLeaks

“Through a combination of anonymity technology and a sophisticated user-feedback system, Silk Road makes buying and selling illegal drugs as easy as buying used electronics—and seemingly as safe. It’s Amazon—if Amazon sold mind-altering chemicals.”54 Built and operated by a mysterious figure who went by the name of Dread Pirate Roberts, Silk Road had two components that allowed it to operate in total anonymity. One, all purchases were processed using a new digital crypto-currency called Bitcoin, which was created by the mysterious pseudonymous cryptographer Satoshi Nakamoto. Two, to use Silk Road, both buyers and sellers first had to download a program called Tor and use a specialized browser to access a specialized store URL—http://silkroad6ownowfk.onion—that took them off the Internet and into the Tor cloud, a.k.a. the dark web. Tor was a cutting-edge anonymity tool made by Tor Project, a nonprofit set up in 2004 by a plump and ponytailed cryptographer named Roger Dingledine, who at the time ran it out of a cluttered office above a YMCA in Cambridge, Massachusetts.


pages: 533

Future Politics: Living Together in a World Transformed by Tech by Jamie Susskind

3D printing, additive manufacturing, affirmative action, agricultural Revolution, Airbnb, airport security, Andrew Keen, artificial general intelligence, augmented reality, automated trading system, autonomous vehicles, basic income, Bertrand Russell: In Praise of Idleness, bitcoin, blockchain, brain emulation, British Empire, business process, Capital in the Twenty-First Century by Thomas Piketty, cashless society, Cass Sunstein, cellular automata, cloud computing, computer age, computer vision, continuation of politics by other means, correlation does not imply causation, crowdsourcing, cryptocurrency, digital map, distributed ledger, Donald Trump, easy for humans, difficult for computers, Edward Snowden, Elon Musk, en.wikipedia.org, Erik Brynjolfsson, Ethereum, ethereum blockchain, Filter Bubble, future of work, Google bus, Google X / Alphabet X, Googley, industrial robot, informal economy, intangible asset, Internet of things, invention of the printing press, invention of writing, Isaac Newton, Jaron Lanier, John Markoff, Joseph Schumpeter, Kevin Kelly, knowledge economy, lifelogging, Metcalfe’s law, mittelstand, more computing power than Apollo, move fast and break things, move fast and break things, natural language processing, Network effects, new economy, night-watchman state, Oculus Rift, Panopticon Jeremy Bentham, pattern recognition, payday loans, price discrimination, price mechanism, RAND corporation, ransomware, Ray Kurzweil, Richard Stallman, ride hailing / ride sharing, road to serfdom, Robert Mercer, Satoshi Nakamoto, Second Machine Age, selection bias, self-driving car, sexual politics, sharing economy, Silicon Valley, Silicon Valley startup, Skype, smart cities, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, smart contracts, Snapchat, speech recognition, Steve Jobs, Steve Wozniak, Steven Levy, technological singularity, the built environment, The Structural Transformation of the Public Sphere, The Wisdom of Crowds, Thomas L Friedman, universal basic income, urban planning, Watson beat the top human players on Jeopardy!, working-age population

As Yochai Benkler argues in The Wealth of Networks (2006) and The Penguin and the Leviathan (2011), it’s not that human nature has changed in the last twenty years to make us more cooperative. Rather, it’s that this scale of cooperative behaviour would have been impossible in the past. Connective technology has made it possible.23 The last few years have seen the emergence of another technology with potentially far-reaching implications for connectivity and cooperation. This is ‘blockchain’, invented by the mysterious pioneer (or pioneers) Satoshi Nakamoto. It’s best known as the OUP CORRECTED PROOF – FINAL, 28/05/18, SPi РЕЛИЗ ПОДГОТОВИЛА ГРУППА "What's News" VK.COM/WSNWS 46 FUTURE POLITICS system underpinning the cryptocurrency Bitcoin, launched in 2009. The workings of blockchain are technically complex, but the basic premise can be described simply. Imagine a giant digital ledger (or spreadsheet) of the kind we would previously have put on paper.


pages: 677 words: 206,548

Future Crimes: Everything Is Connected, Everyone Is Vulnerable and What We Can Do About It by Marc Goodman

23andMe, 3D printing, active measures, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, airport security, Albert Einstein, algorithmic trading, artificial general intelligence, Asilomar, Asilomar Conference on Recombinant DNA, augmented reality, autonomous vehicles, Baxter: Rethink Robotics, Bill Joy: nanobots, bitcoin, Black Swan, blockchain, borderless world, Brian Krebs, business process, butterfly effect, call centre, Charles Lindbergh, Chelsea Manning, cloud computing, cognitive dissonance, computer vision, connected car, corporate governance, crowdsourcing, cryptocurrency, data acquisition, data is the new oil, Dean Kamen, disintermediation, don't be evil, double helix, Downton Abbey, drone strike, Edward Snowden, Elon Musk, Erik Brynjolfsson, Filter Bubble, Firefox, Flash crash, future of work, game design, global pandemic, Google Chrome, Google Earth, Google Glasses, Gordon Gekko, high net worth, High speed trading, hive mind, Howard Rheingold, hypertext link, illegal immigration, impulse control, industrial robot, Intergovernmental Panel on Climate Change (IPCC), Internet of things, Jaron Lanier, Jeff Bezos, job automation, John Harrison: Longitude, John Markoff, Joi Ito, Jony Ive, Julian Assange, Kevin Kelly, Khan Academy, Kickstarter, knowledge worker, Kuwabatake Sanjuro: assassination market, Law of Accelerating Returns, Lean Startup, license plate recognition, lifelogging, litecoin, low earth orbit, M-Pesa, Mark Zuckerberg, Marshall McLuhan, Menlo Park, Metcalfe’s law, MITM: man-in-the-middle, mobile money, more computing power than Apollo, move fast and break things, move fast and break things, Nate Silver, national security letter, natural language processing, obamacare, Occupy movement, Oculus Rift, off grid, offshore financial centre, optical character recognition, Parag Khanna, pattern recognition, peer-to-peer, personalized medicine, Peter H. Diamandis: Planetary Resources, Peter Thiel, pre–internet, RAND corporation, ransomware, Ray Kurzweil, refrigerator car, RFID, ride hailing / ride sharing, Rodney Brooks, Ross Ulbricht, Satoshi Nakamoto, Second Machine Age, security theater, self-driving car, shareholder value, Silicon Valley, Silicon Valley startup, Skype, smart cities, smart grid, smart meter, Snapchat, social graph, software as a service, speech recognition, stealth mode startup, Stephen Hawking, Steve Jobs, Steve Wozniak, strong AI, Stuxnet, supply-chain management, technological singularity, telepresence, telepresence robot, Tesla Model S, The Future of Employment, The Wisdom of Crowds, Tim Cook: Apple, trade route, uranium enrichment, Wall-E, Watson beat the top human players on Jeopardy!, Wave and Pay, We are Anonymous. We are Legion, web application, Westphalian system, WikiLeaks, Y Combinator, zero day

DAN KAMINSKY, SECURITY RESEARCHER Technology is enabling new forms of money, and the growing digital economy holds great promise to provide new financial tools, especially to the world’s poor and unbanked. These emerging virtual currencies are often anonymous and none have received quite as much press as Bitcoin, a decentralized peer-to-peer digital form of money. Bitcoins were invented in 2009 by a mysterious person (or group of people) using the alias Satoshi Nakamoto, and the coins are created or “mined” by solving increasingly difficult mathematical equations, requiring extensive computing power. The system is designed to ensure no more than twenty-one million Bitcoins are ever generated, thereby preventing a central authority from flooding the market with new Bitcoins. Most people purchase Bitcoins on third-party exchanges with traditional currencies, such as dollars or euros, or with credit cards.


pages: 700 words: 201,953

The Social Life of Money by Nigel Dodd

accounting loophole / creative accounting, bank run, banking crisis, banks create money, Bernie Madoff, bitcoin, blockchain, borderless world, Bretton Woods, BRICs, business cycle, capital controls, cashless society, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, commoditize, computer age, conceptual framework, credit crunch, cross-subsidies, David Graeber, debt deflation, dematerialisation, disintermediation, eurozone crisis, fiat currency, financial exclusion, financial innovation, Financial Instability Hypothesis, financial repression, floating exchange rates, Fractional reserve banking, German hyperinflation, Goldman Sachs: Vampire Squid, Hyman Minsky, illegal immigration, informal economy, interest rate swap, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, Joseph Schumpeter, Kickstarter, Kula ring, laissez-faire capitalism, land reform, late capitalism, liberal capitalism, liquidity trap, litecoin, London Interbank Offered Rate, M-Pesa, Marshall McLuhan, means of production, mental accounting, microcredit, mobile money, money market fund, money: store of value / unit of account / medium of exchange, mortgage debt, negative equity, new economy, Nixon shock, Occupy movement, offshore financial centre, paradox of thrift, payday loans, Peace of Westphalia, peer-to-peer, peer-to-peer lending, Ponzi scheme, post scarcity, postnationalism / post nation state, predatory finance, price mechanism, price stability, quantitative easing, quantitative trading / quantitative finance, remote working, rent-seeking, reserve currency, Richard Thaler, Robert Shiller, Robert Shiller, Satoshi Nakamoto, Scientific racism, seigniorage, Skype, Slavoj Žižek, South Sea Bubble, sovereign wealth fund, special drawing rights, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, transaction costs, Veblen good, Wave and Pay, Westphalian system, WikiLeaks, Wolfgang Streeck, yield curve, zero-coupon bond

The technical problems that need to be overcome to achieve this combination are considerable. Two key dangers have to be avoided: the low-cost producer who can flood the market with bit gold (or, subsequently, Bitcoins) and the profiteering “bit gold miner” who uses optimized computer architecture. The history of Bitcoin suggests that the latter has proven more difficult to avoid than the former. Satoshi Nakamoto—a pseudonym for an individual or a group—introduced the idea of Bitcoin in a 2008 paper (Nakamoto 2008). He characterized the scheme as a system for electronic transactions that did not rely on trust, a possibility that in his view specifically required the elimination of opportunities for double spending. Double spending exists as a problem in electronic payment systems because each owner of a coin has no means of knowing whether or not the previous owner of the coin used it twice.


Engineering Security by Peter Gutmann

active measures, algorithmic trading, Amazon Web Services, Asperger Syndrome, bank run, barriers to entry, bitcoin, Brian Krebs, business process, call centre, card file, cloud computing, cognitive bias, cognitive dissonance, combinatorial explosion, Credit Default Swap, crowdsourcing, cryptocurrency, Daniel Kahneman / Amos Tversky, Debian, domain-specific language, Donald Davies, Donald Knuth, double helix, en.wikipedia.org, endowment effect, fault tolerance, Firefox, fundamental attribution error, George Akerlof, glass ceiling, GnuPG, Google Chrome, iterative process, Jacob Appelbaum, Jane Jacobs, Jeff Bezos, John Conway, John Markoff, John von Neumann, Kickstarter, lake wobegon effect, Laplace demon, linear programming, litecoin, load shedding, MITM: man-in-the-middle, Network effects, Parkinson's law, pattern recognition, peer-to-peer, Pierre-Simon Laplace, place-making, post-materialism, QR code, race to the bottom, random walk, recommendation engine, RFID, risk tolerance, Robert Metcalfe, Ruby on Rails, Sapir-Whorf hypothesis, Satoshi Nakamoto, security theater, semantic web, Skype, slashdot, smart meter, social intelligence, speech recognition, statistical model, Steve Jobs, Steven Pinker, Stuxnet, telemarketer, text mining, the built environment, The Death and Life of Great American Cities, The Market for Lemons, the payments system, Therac-25, too big to fail, Turing complete, Turing machine, Turing test, web application, web of trust, x509 certificate, Y2K, zero day, Zimmermann PGP

“QNX crypt() broken”, Peter Gutmann, posting to the cryptography@c2.net mailing list, message-ID 95583323401676@kahu.cs.auckland.ac.nz, 16 April 2000. “Hacking The iOpener”, http://iopener.how.to. “I-Opener FAQ”, http://fastolfe.net/2006/iopener/faq. “I-Opener Running Linux”, http://www.linux-hacker.net/imod/imod.html. References [81] [82] [83] [84] [85] 411 “M4I (Midori Linux for iOpener) Homepage”, http://tengu.homeip.net/midori. “Bitcoin: A Peer-to-Peer Electronic Cash System”, ‘Satoshi Nakamoto’, 2008, http://bitcoin.org/bitcoin.pdf. “Bitter to Better — How to Make Bitcoin a Better Currency”, Simon Barber, Xavier Boyen, Elaine Shi and Ersin Uzun, Proceedings of the 15th Financial Cryptography Conference (FC’12), Springer-Verlag LNCS No.7397, February 2012, p.399. “Custom Chips Could Be the Shovels in a Bitcoin Gold Rush”, Tom Simonite, 5 December 2012, http://www.technologyreview.com/news/508061/custom-chips-could-be-the-shovels-in-a-bitcoin-gold-rush.