History

Birth of Bitcoin

  • 18 August 2008: registration of the website bitcoin.org by Satoshi Nakamoto and Sirius (aka Martti Malmi)
  • 31 Oktober 2008: publication of the BitcoinWhitepaper by Satoshi Nakamoto
  • 1 November 2008: Satoshi Nakamoto sends his Bitcoin p2p e-cash paper to an email list for cryptography (mailing list) and presents it to the group
  • 3 Januar 2009: the Bitcoin network comes to life after Satoshi Nakamoto mines the first block. He includes a message into this genesis block: The Times 03/Jan/2009 Chancellor on brink of second bailout for banks. It’s a timestamp and also interpreted as an answer towards the global financial crash caused by the financial system
  • 8 Januar 2009: Satoshi Nakamoto releases the first software Bitcoin v0.1. It’s opensource, everyone can change it and participate in the process
  • 12 Januar 2009: the first transaction is send from Satoshi Nakamoto to Hal Finney
  • 17 Mai 2010: the first use case for buying goods is created by Laszlo_Hanyecz. He buys 2 pizza for 10,000 Bitcoin
  • 13 Dezember 2010: the last recorded activity of Satoshi Nakamoto 

 

Who is Satoshi Nakamoto?

The mystery of Satoshi Nakamoto has never been resolved. Journalists all over the world have been on a man hunt, trying to identify who’s behind Satoshi Nakamoto. Single individuals as Craig Wright, who’s since known as Fake Satoshi, tried to claim the identity for themselves. It is not even known if Satoshi Nakamoto is a man, a woman or even a group of people.

The usual questions which arise as a result of this mystery: who controls Bitcoin? And why did the person or group of people remain icognito? The short answer: the meaning of the network per se – a decentralized system without a single point of failure. Is a system closely tied to a single entity, the entire project rises and falls with the person or the company at the highest point. Introducing boards, committees or trusts may help to a certain degree, but sooner rather than later the purity of the system is compromised. So far all efforts to eradicate the vulnerabilities of these centers of power have failed. If there was a need for a final, colossal proof, our financial system showed it to us. After the financial crisis in 2008, which was caused by our banking institutions, no regulations were passed which would force these institutions to change their toxic conduct. These power structures are so rusty that changes are either very hard to achieve or these changes are simply not wanted by the people in charge. A system which requires trust in people is interconnected with the benevolence of individuals. It is per se impossible that a single person or group of people can act independent, impregnable and correct in perpetuity. To guarantee such an idea, a global network has been created, which is trustless in nature. There’s no entity at the heart, no single point of failure. Only one principle prevails: code is law with the requirement of a democratic consensus. The underlying code can only be changed if there is a democratic consensus of the majority of the participants in the system. If the consensus cannot be achieved, no change is possible.

Although there is no final conclusion about the identity of Satoshi Nakamoto, a pathway towards Bitcoin is reconstructable. 

In 1992 Tim May, Eric Hughes and John Gilmore launched the cypherpunk¹ mailing list. Other people on this list included Jim Bell, David Chaum, Phil Zimmerman, Julian Assange, Adam Back, Wei Dai and Hal Finney. Further important figures in this process were Tim Berners-Lee (inventor of the www), John Perry Barlow and Nick Szabo.

Before Bitcoin could be created, some prerequisites had to be in place, some failures traversed. Asymmetrical cryptography was needed as key encryption while other early stage digital currencies needed to fail. One could therefore argue that Bitcoins predecessors listened to the names of Digicash, E-Gold, B-Money, Bitgold or Hashcash. They all provided solutions for the creation of a digital currency. Digicash or the Liberty Reserve Dollar were prime examples for what happens to the creation of an “unauthorized” payment method – the nation state intervenes, shuts down the project and prosecutes the creators. Another problem that needed being addressed was the one of double spending which Adam Backs Hashcash solved. Only after all these puzzle pieces were available, Bitcoin was able to come to life. In the end the components of the Bitcoin network were nowhere extra ordinary, it was the compounding of these pieces and the understanding of what precautions were necessary which was mastery.

Although people might want to see the mystery around Satoshi Nakamoto resolved, the reasons for him/her/them to stay in the shadows were comprehensible and in fact unalterable for the success of Bitcoin. Still, doubts remain how a system free of managing directors or centers of power can function properly and if there isn’t a group of people which are manipulating the tenor of events after all. Or how is it that Satoshi Nakamoto doesn’t simply “change the code” sooner or later, willingly or unwillingly. For those the book Mastering Bitcoin by Andreas Antonopoulos²  is recommended which is free to download. For the system Bitcoin and the network itself, it doesn’t matter who created Bitcoin, what sort of person he/she/they was/were, not even what the intention was for the invention of Bitcoin. No more than Sir Isaac Newtons character or intention was important for the formulation of Newton’s Laws for us today. These very laws are the foundation of mathematics today and although we might be very thankful to the discoverers and inventors for formulating these laws and rules, after they are proclaimed these very descriptors are not relevant to these laws anymore. In a similar way, Bitcoin is nothing more than a formulation of laws and rules which became so independent from its creator that even this very creator could not change them at will. They were proclaimed and henceforth these laws exist in our world system. Nevertheless, we should bestow honor to Satoshi Nakamoto in the same way we do to all great inventors and discoverers. The creation of this network is equal to the invention of the internet, the light bulb or the automobile in its relevance to the world.

 

Politics

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¹ Cypherpunks took a stand on privacy. They were ahead of today’s discussions and formulated them early on, as Eric Hughes did in 1993 with: A Cypherpunks Manifesto

² Andreas Antonopoulos is a computer scientist who presented Bitcoin to the Senate of Canada in 1994 when he was introduced by the Head of Committee in the following: “Today we are pleased to welcome Mr. Andreas Antonopoulos, considered to be THE Bitcoin Guru… Mr. Antonopoulos is both an entrepeneur and author in the field of Bitcoin. He is a computer science graduate from the University College in London. His expertise includes Bitcoin, cryptocurrencies, information security, cryptography, cloud computing, data centers, linux, opensource and robotic software development. He had over 200 articles published and print and is syndicated worldwide. In addition, he is a certified security information professional for over 12 years and is a permanent host on Let’s talk Bitcoin! (a webcast devoted to Bitcoin). Mr. Antonopoulos is also a prolific public speaker… He has literally written the book on Bitcoin, which is entitled Mastering Bitcoin…”. He is a champion of Bitcoin and a public speaker. His follow up book Mastering Ethereum is in writing. His speeches are both legendary and unconditionally recommendable.