If your day gold died, in what later became referred to as the Nixon Shock, hasn't stopped the financial world from spinning, why would currency going digital send shockwaves through the global economy? Since the start of its existence, money has continually transformed and evolved, but at its core it always remained a moderate of exchange. Economists see currency as widely accepted legal tender issued by a government and circulating within an economy of a country. But what would happen if "government" and "country" were taken out from the definition? Up to shortly ago, that has been technologically impractical and scientifically impossible.blockchain
And a mysterious new technology emerged
Seemingly out of nowhere, but usually the consequence of a few decades of research and development by many unknown computer science scientists across the world. In fact, the initial digital currencies, or at least the concept, existed as early since the mid 90s, around enough time the Internet was fully commercialized. Essentially, all of them endured one major drawback that led to their inevitable demise. Each of them required a main, trusted 3rd party to administer the issuance of new units and reconcile payments at the end of the day.Block Chain Software
So how is Bitcoin so different?
Bitcoin emerged in 2009 since the creation of an individual beneath the pseudonym Satoshi Nakamoto. It became the world's first fully operational, decentralized, peer-to-peer, digital currency system. Being decentralized, intrinsically means being self-organizing, a phenomena where local individuals achieve global goals without central planning or influence. Although decentralized systems is found in nature, the concept is challenging to understand in its monetary context, as we are accustomed to the voice of central governments and financial institutions orchestrating our economic lives.Know more
Computer networks and the Byzantine Empire
From the computer science perspective, establishing trust between unrelated parties over an untrusted network (like the Internet), is section of some problems referred to as the Byzantine Generals Problem. The Byzantine army was chosen to illustrate the issue because it'd suffered recurrent treacheries among the high ranks of its military command. Imagine several divisions of the Byzantine army camped around an enemy city, each division is led by its general. Because of geographic obstacles, the generals can communicate with one another only through messengers. To be able to achieve victory, the generals must decide upon a common strategy unanimously. However, a few of the generals may be traitors and will endeavour to avoid the loyal generals from reaching consensus. If the traitors succeed the attack is doomed to fail.