- 1 Bitcoin (BTC), the first and strongest digital asset is celebrating White Paper’s 15th anniversary.
- 2 15 years ago, on October 31, 2008, Satoshi Nakamoto introduced white paper and code to the crypto world.
- 3 Entire facts linked to Bitcoin such as concept and design, payment system, and mechanism are outlined in the paper.
October 31 turned out to be a historic day in Bitcoin’s journey. 15 years ago to the day, an anonymous developer shared the white paper and code to a mailing list of cryptographers.
“I have been working on the new digital cash system that’s fully peer-to-peer, without any involvement of a trusted third party,” said Satoshi in an email in 2008.
BTC value has hit several ups and downs till now. Let’s delve into the world of cryptocurrency and celebrate White Paper’s 15th anniversary together.
Bitcoin’s Journey Till Date
Bitcoin cryptocurrency, one of the oldest players in the crypto market, made it possible to carry out instant payments using virtual currency. The coin was introduced in 2009 and uses peer-to-peer technology to facilitate instant payments and transaction-related services.
The digital asset is considered to be the first investigation to adopt cryptography, enabling financial institutions and banks to transact all around the world. Laszlo Hanyecz made the very first transaction using it, buying two pizzas for 10,000 BTC in 2010.
However, the digital asset gained popularity and adoption when it made legal tender in El Salvador in September 2021.
Despite several options in the crypto marketplace, BTC still tends to be the most popular choice for businesses, investors, and traders worldwide.
What’s Inside BTC’s White Paper?
Bitcoin’s white paper was presented on 31 October 2008, titled “Bitcoin: A Peer-to-Peer Electronic Cash System” and engaged every detail associated with the digital asset. Concepts and designing of BTC including consensus mechanism, transactions, payment verification system, and privacy were shared in the white paper.
Transactions and Timestamp Server
The Transaction sector of the White Paper defines the concept of an electronic coin as a chain of digital signatures that helps owners transfer each coin to the next person. Digital signatures include the previous transaction’s hash and the next owner’s public key, permitting the payee to validate the coin’s ownership record. The approach motives to develop a decentralized and trustless system for online transactions and is a fundamental factor behind Bitcoin.
Another key factor discussed in the white paper is the Timestamp server, which designs the existence of data at a specific time. The same is achieved using a hash of a set of items to be timestamped and making the hash widely available. Each timestamp involves a previous timestamp within its hash, generating a chronological chain. Also, the distributed timestamp server depends on the Proof-of-Work (PoW) system. So let’s understand the PoW system.
The Proof-of-Work Consensus Mechanism
PoW mechanism is a decentralized consensus mechanism that requires the network community to expend efforts in resolving an encrypted hexadecimal number. The process helps in validating the transactions on a blockchain. Searching a value that when hashed with a function like SHA-256 results in a hash starting with a series of zero bits.
In Bitcoin, the PoW algorithm aims to add a new block every 10 minutes by adjusting the difficulty of mining BTC. Also, if blocks are generated too fast, the challenge increases, making it difficult to maintain the required block creation rate.
How to Run the Network?
Another major area focused on by BTC’s white paper is the steps to run the network.
The complete working of the network depends on nodes and blocks. Each transaction is broadcast to all nodes, and each node assembles new transactions into a block. The block is broadcasted to all nodes when a node finds a PoW. The broadcasted blocks are accepted by the nodes only if all transactions are valid and generate a new blockchain in the chain, using the hash of the valid block.
Verifying payments is another key concept discussed in BTC’s whitepaper, permitting users to verify payment without working a full network node. Users can verify payments by holding a copy of the block header from the PoW blockchain.
What About Privacy?
In the electronic payment system, all transactions are publicly announced and public keys are kept anonymous. Individuals can see a transaction happening between two parties but no information directly connects the transaction to any individual.
To uplift privacy further, Satoshi also recommended a new key pair for each transaction to make it challenging for bad actors to trace back to a single owner. However, revealing the owner’s key may result in the disclosure of all other transactions that belong to the same owner.
How Far Has BTC Reached?
With time, BTC hit new heights and emerged as one of the strongest digital currencies in the crypto space. At the time of its launch, Bitcoin’s value was $0.0009 and hit $430 in 2015. Despite several ups and downs, the digital coin emerged as one of the most valuable coins in circulation.
The current Bitcoin price is $34,378.30, with a decline of 0.33% in the past 24 hours, a market cap of $671 Billion, and a 24-hour volume of $17 Billion. The total supply of the digital asset is 21 Million BTC, and the circulating supply is 19,529,050 BTC.
The Bitcoin mining process helps miners generate new Bitcoin cryptocurrency and miners are rewarded with a predetermined amount of BTC. Each time, miners’ rewards were reduced by half and expected to continue until 2140. The first halving took place in 2012, after 210,000 blocks were minted, and the rewards from Bitcoin blocks slashed from 50 BTC to 25 BTC.
The next halving is expected to take place in April 2024.
Bitcoin’s white paper is celebrating its 15th anniversary on October 31. Satoshi Nakamoto shared the white paper and code with the world to vitrine the power of digital assets and electronic cash systems. Considering the PoW consensus mechanism, BTC reached so far with more room to run. Currently, the BTC price is $34,378.30 and is expected to hit new heights soon.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.