[[Bitcoin]] is a [[Distributed computing]] system for [[Cryptocurrency]] [[Money]]. I first heard about Bitcoin in 2011 from [Security Now 287: BitCoin CryptoCurrency](https://www.youtube.com/watch?v=XQPSwA2Itbs) by [[Steve Gibson]]. I am pretty sure I paid a crazy amount of money (today) for a [Arq](https://www.arqbackup.com/) license. That wallet is long gone anyway. Arq lets you backup files with client-side encryption to [[Amazon Web Services|AWS]] S3. BitCoin has the _[[First-mover advantage]]_. From [[The Bitcoin Standard (book)]]: > Bitcoin is the world's first digital monetary network. Bitcoin is also the world's first engineered monetary asset. Together, these traits represent the most disruptive technology in the world, the greatest opportunity currently available to those who wish to create something new and wonderful, and the solution to the store-of-value problem faced by 7.8 billion people, 100+ million companies, and hundreds of trillions of dollars of investor capital. [[Gwern]] remarks that Bitcoin is an example of [[Worse is better]] in his essay [Bitcoin Is Worse Is Better · Gwern.net](https://www.gwern.net/Bitcoin-is-Worse-is-Better): > On how Bitcoin’s long gestation and early opposition indicates it is an example of the ‘Worse is Better’ paradigm in which an ugly complex design with few attractive theoretical properties compared to purer competitors nevertheless successfully takes over a niche, survives, and becomes gradually refined. > > However, the sacrifice Bitcoin makes to achieve decentralization is—however practical—a profoundly _ugly_ one. Early reactions to Bitcoin by even friendly cryptographers & digital currency enthusiasts were almost uniformly extremely negative, and emphasized the (perceived) inefficiency & (relative to most cryptography) weak security guarantees. Critics let ‘perfect be the enemy of better’ and did not perceive Bitcoin’s potential. However, in an example of ‘Worse is Better’, the ugly inefficient prototype of Bitcoin successfully created a secure decentralized digital currency, which can wait indefinitely for success, and this was enough to eventually lead to adoption, improvement, and growth into a secure global digital currency. > > What’s wrong with Bitcoin is that it’s ugly. It is not elegant. It’s clever to define your bitcoin balance as whatever hash tree is longer, has won more races to find a new block, but it’s ugly to make your network’s security depend solely on having more brute-force computing power than your opponents⁠, ugly to need now and in perpetuity at least half the processing power just to avoid double-spending⁠. > > But like the proverbial cockroaches, Unix spread, networked, survived—and the rest did not. And as it survives and evolves gradually, it slowly becomes what it “should” have been in the first place. Or HTML vs Project Xanadu⁠. > > A cryptographer would have difficulty coming up with Bitcoin because the mechanism is so ugly and there are so many elegant features he wants in it. Programmers and mathematicians often speak of “taste”, and how they lead one to better solutions. **A cryptographer’s taste is for cryptosystems optimized for efficiency and theorems; it is not for systems optimized for virulence, for their sociological appeal.** This phenomenon can be observed by seeing how programmers name things such as chat rooms. The names will be very serious, lacking joviality and playfulness. ## On whatever Read [Mastering Bitcoin](https://learning.oreilly.com/library/view/mastering-bitcoin-2nd/9781491954379/) by [[Andreas M. Antonopoulos]]. [Lightning Network Daemon](https://github.com/lightningnetwork/lnd) ([[Lightning Network Daemon]]). The [[Hashed Timelock Contracts]]. Read [Mastering the Lightning Network](https://learning.oreilly.com/library/view/mastering-the-lightning/9781492054856/) by [[Andreas M. Antonopoulos]]. [[Lightning Network]]. [[Byzantine fault]] is important. [[Bitcoin Improvement Proposals]]. A set of proposals that members of the bitcoin community have submitted to improve bitcoin. For example, BIP-21 is a proposal to improve the bitcoin uniform resource identifier (URI) scheme. Like [[Python Enhancement Proposals]]. [[Elliptic Curve Digital Signature Algorithm]] or ECDSA is a cryptographic algorithm used by Bitcoin to ensure that funds can only be spent by their rightful owners. [[Proof of work]] means that a certain amount of a specific computational effort has been expended. Maybe someone would like to do [[Dollar cost averaging]] on the volatile price of BitCoin. ## On the wicked problem [[Cryptocurrency]] adaptation is a [[Wicked problem]]. [[Bitcoin]] was published in 2009, and is still trying to find its place in society. However, the ideas are so revolutionary that pioneering minds refuse to give up. Consider how silly the online global payment market is. You have to give away a copy of your key (card details) to some third party provider. The provider tells the bank to charge the card. The bank charges the card. They move the money through the Visa or Mastercard network. Can you imagine the insane infrastructure required to do all of this globally? Every local bank is running its own set of payment systems and ledgers. How much brain power and resources are being used to keep all of this running? Global payments are a joke, and no one is trying to improve the traditional systems. Payments through [[Society for Worldwide Interbank Financial Telecommunications]] has the most ridiculous user experience. It is obviously not a solution you would invent if you started from scratch. Perhaps the same could be said of the [[Lightning Network]]? For the latter, perhaps the benefits outweigh the drawbacks? [[Blockchain]] (and perhaps [[Block-lattice]]) is the theoretical solution. It is the natural evolution. Natural principles. Banks today reconcile on a batch basis.