Bitcoin

A brief but unforgettable moment with Ethereum’s creator — and a very special signature.

A Lost Wallet.dat, Forgotten Since 2017

Bitcoin and Cryptocurrency Technologies provides a comprehensive introduction to the revolutionary yet often misunderstood new technologies of digital currency. Whether you are a student, software developer, tech entrepreneur, or researcher in computer science, this authoritative and self-contained book tells you everything you need to know about the new global money for the Internet age. How do Bitcoin and its blockchain actually work? How secure are your bitcoins? How anonymous are users of cryptocurrencies? Can cryptocurrencies be regulated? These are some of the many questions this book answers. It begins by tracing the history and development of Bitcoin and cryptocurrencies, and then gives the conceptual and practical foundations you need to engineer secure software that interacts with the Bitcoin network as well as to integrate ideas from Bitcoin into your own projects. Topics include decentralization, mining, the politics of Bitcoin, altcoins and the cryptocurrency ecosystem, the future of Bitcoin, and more. ...

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. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. We propose a solution to the double-spending problem using a peer-to-peer network. The network timestamps transactions by hashing them into an ongoing chain of hash-based proof-of-work, forming a record that cannot be changed without redoing the proof-of-work. The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power. As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they’ll generate the longest chain and outpace attackers. The network itself requires minimal structure. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone. ...

Since the introduction of Bitcoin in 2009, and the multiple computer science and electronic cash innovations it brought, there has been great interest in the potential of decentralised cryptocurrencies. At the same time, implementation changes to the consensuscritical parts of Bitcoin must necessarily be handled very conservatively. As a result, Bitcoin has greater difficulty than other Internet protocols in adapting to new demands and accommodating new innovation. We propose a new technology, pegged sidechains, which enables bitcoins and other ledger assets to be transferred between multiple blockchains. This gives users access to new and innovative cryptocurrency systems using the assets they already own. By reusing Bitcoin’s currency, these systems can more easily interoperate with each other and with Bitcoin, avoiding the liquidity shortages and market fluctuations associated with new currencies. Since sidechains are separate systems, technical and economic innovation is not hindered. Despite bidirectional transferability between Bitcoin and pegged sidechains, they are isolated: in the case of a cryptographic break (or malicious design) in a sidechain, the damage is entirely confined to the sidechain itself. ...