A Milestone to Celebrate: Bitcoin Whitepaper Hits 15!
Happy birthday to Bitcoin (BTC)! The seminal whitepaper, crafted by anonymous developer(s) Satoshi Nakamoto, turned 15 today after being released on 31/10/2008. The document was published as “Bitcoin: A Peer-to-Peer Electronic Cash System” and proposed an immutable database that supported trustless transactions (that is, sending and receiving money without an intermediary). BTC itself wasn’t live until a few months later, when the first coin was mined by Nakamoto on the 3rd of January, 2009.
The Whitepaper’s Contents
Satoshi Nakamoto’s document was released in the wake of 2008’s Global Financial Crisis and is often considered a direct response to the economic downturn. Much of society put the blame for rising unemployment and lost homes squarely at the feet of the banks due to irresponsible lending. Trust in banks had never been lower than in the aftermath, something that Nakamoto touched upon in his whitepaper.
The nine-page document kicks off by discussing why a trustless, electronic cash system is needed in the first place – as a way to return financial power to the individual and lessen the influence of banking goliaths. On top of this, removing a third party from transactions allows for faster settlement times and lower costs, or so Nakamoto argued.
The remainder of the whitepaper touches on the fundamentals of Bitcoin – the basics of cryptography, how a blockchain network would be structured and maintained, and how users can participate in nodes by “mining” to solve a hash function. Finally, Nakamoto turned his attention to security and demonstrated how difficult it would be for attackers to compromise the Bitcoin network due to its decentralised nature.
The Early Days of Bitcoin
Bitcoin was more of a concept than an asset in its early stages, valued at just US $0.0008 upon launch. Initially, banks dismissed the idea of a decentralised P2P payments system, while society was mostly sceptical of the coin. However, as the years went by, more and more investors got on board and the price of BTC eventually soared past $1,000 (AUD $1,577) in 2013.
Now, Bitcoin is just a drop in the bucket of the overall crypto market. Its original intention – to serve as a trustless payment option – has long been lost, with BTC now resembling something akin to “digital gold”. Bitcoin is celebrating its birthday with a 0.5% increase in value, leaving it hanging around the $34,500 (AUD $54,419) price point.
Whatever Bitcoin’s price action does from here, one thing’s for sure – it has come a long way since Nakamoto first published the idea on this day 15 years ago.