My plan for week two was to read the Bitcoin White Paper. The white paper is essentially a document that lays out the design, features, or motivations for an idea, innovation, or issue. The white paper is usually issued by the creator or owner of the topic. Satoshi Nakamoto is the individual or group that issued the Bitcoin White Paper. Two pages in, I was confused about what different terms meant and how exactly Bitcoin functioned.
Yan Pritzker, the author of Inventing Bitcoin, breaks down Satoshi Nakamoto’s white paper very thoroughly and each of the defining parts that make up Bitcoin. After one week of watching videos and discussing Bitcoin, I found myself with a lot of questions. Where does it come from? Who controls it? What really is mining? What does it mean to be a decentralized network? After reading Pritzker’s book I was able to answer most of these questions and also understand Nakamoto’s true intentions in creating Bitcoin. Bitcoin is a peer-to-peer electronic cash or payment. It wishes to get rid of the need for a middleman or the need to trust the bank or the government with one’s money. Stepping into this project I wanted to understand how cryptocurrency worked and I have walked away from it, learning how much trust really matters. Nakamoto wanted to get rid of the need to trust a middleman or third party. He removed the need for one to trust him. Bitcoin is an open-source meaning that anyone can see it, learn how it works, and contribute to it, therefore there was no need to trust Nakamoto.
Midway through the week, I started to learn more about what a decentralized system is. I had come across the word hundreds of times in the articles, podcasts, videos, and books I had read. A decentralized system like Bitcoin is run by and controlled by multiple companies and individuals around the world while a centralized system is run by one company or individual. The purpose of a decentralized system is so that if one company or individual falls due to bankruptcy, hacking, or server crash there is another to keep the system running. A decentralized system is essentially impossible to shut down because of this.
One of my many goals for this project was to learn about cryptocurrency. I did not expect it to take multiple weeks but seeing how complex it is I am excited to learn more. I want to further understand how Bitcoin prevents debasement, how crypto proof works instead of trust, and whether Bitcoin is a force of good or bad. I am happy with the progress I have made. I hope that by the end of this 3rd week I will have sufficient information and knowledge to put on a pamphlet for those in my community. As I read more about Bitcoin I hope to discover how Bitcoin is worth a lot one day and very little the next and what it means for something to go up in the market. I am hoping that I can move on a bit from Bitcoin and learn about how the market functions.