Bitcoin: A Peer-to-Peer Electronic Cash System

The paper that first introduced Bitcoin

Satoshi Nakamoto's original paper is still recommended reading for anyone studying how Bitcoin works. Choose which translation of the paper you want to read:

English original
EspaГ±ol (EspaГ±a) translated by Breathingdog
EspaГ±ol (Latinoamericano) translated by Angel LeГіn
Italiano translated by Terzim
Р СѓСЃСЃРєРёР№ translated by Ar Vicco
Svenska translated by hanspandeya

Do you want to translate the paper into your language? Visit the Bitcoin Paper repository for instructions and open an issue if you have any questions.

Bitcoin whitepaper

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Whitepaper

What is this page?

This page shows whether different Bitcoin sites serve the original Bitcoin whitepaper or an edited version of it. Once an hour we calculate SHA-256 hashes of the files and compare them with the hash of the original whitepaper (that would be b1674191a88ec5cdd733e4240a81803105dc412d6c6708d53ab94fc248f4f553).

There have been some suggestions to alter the whitepaper hosted on bitcoin.org (e.g. GitHub Issue #1325 is still open). We believe that editing an academic paper and rewriting the Bitcoin history in order to accommodate someone's business interests is downright unacceptable.

Where can I find the whitepaper in the Bitcoin blockchain?

First of all, there are some null-data outputs containing the hash as plaintext. You can find them using a filter on the outputs table. Examples: 99725194:1, 100122486:1, 111318670:2

Also there are null-data outputs which contain the hash as hex. The current version of our search engine doesn't yet have support for filtering scripts by hex values, but since the hex value can be represented as binary text, we can search by alphanumerical parts of this text. Examples: 90947865:0, 127382188:1, 146223515:0

More importantly, there's transaction 54 e48e5f 5c656b 26c3bc a14a8c 95aa58 3d07eb e84dde 3b7dd4 a78f4e 4186e7 13 which contains the pdf file itself. Here's an instruction on how to parse it. It may be possible to edit the whitepaper on some websites, but it's not possible to alter the blockchain.

Bitcoin: What’s in the White Paper?

10 min read / December 30, 2017

In August of 2008, the domain bitcoin.org was registered, and just three months later, a mysterious entity posted the original Bitcoin whitepaper. Authored by Satoshi Nakamoto, an entity claiming to be a 36-year old Japanese man, the whitepaper is only a nine-page document outlining the core fundamentals of Bitcoin, and was followed by the first open source Bitcoin client in January of 2009. Satoshi himself mined the first block, called the genesis block, which had a reward of 50 bitcoins.

Strangely enough, Satoshi seemed to be a real person, albeit a genius at that, and interacted heavily with other developers for several years, improving Bitcoin while never revealing anything that could pin down who he really was. Then in April 2011, Nakamoto announced he had “moved on to other things”, and was never heard of again.

Through the same genius that was able to invent a cryptographically secured currency, Satoshi Nakamoto fully obfuscated his identity, and to this day no one knows who he really was. Whoever it was must have had an extreme mastery of economics, cryptography, C++ programming, and peer to peer networking. Nakamoto was also incredibly skilled at writing in English.

The Contents of the Whitepaper

So what did Satoshi write in the whitepaper that started this all? Well, he starts with an abstract, where he lays out the goal of an entirely peer-to-peer payment system in which no broker entity is required other than the payment network itself.

After the abstract, Satoshi writes a basic introduction. The problem Bitcoin is trying to solve is the lack of trust in electronic payments. Specifically, without a banking authority acting as the broker of online transactions, two entities attempting to transact have no way of ensuring the other is trustworthy. He states that:

“What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party.”

Historically, the problem that mainly occurred in electronic payment systems is double spending, in which a single piece of currency could be spent multiple times when proper mechanisms were not in place. Bitcoin addresses this through its timestamp based chronological ledger of transactions.

An electronic coin is defined as a chain of digital signatures, where the transfer of coins – or fractions thereof – is handled by digitally signing a hash of the previous transaction along with the cryptographic public key of the next owner. A receiver of coins can still not verify that the previous owner of that coin did not spend it multiple times, and this is where a minting authority usually comes into play in the traditional exchange of money.

Instead, though, Satoshi writes that another way to ensure double spending does not occur is through public announcement of all transactions, where the timestamp is critical. Based on when the transaction happened, a second transaction would need to be refused based on its timestamp, which would clearly state it occurred after the first.

How can people ensure the first transaction is known to everyone, though?

Satoshi digs into this exact question, diving right into how the timestamp server would need to behave. The timestamp server broadcasts a hash, which holds the previously diagrammed transaction records. By broadcasting this hash publicly, the timestamp generated by this public announcement serves as proof that the transaction must have existed then. Each new hash includes the previous hash along with a new block of data, forming a chain where each subsequent timestamp reinforces the one before it.

The actual implementation of this timestamp server would occur through a proof-of-work mechanism, according to Satoshi. Similar to Adam Back’s Hashcash, the proof involves scanning for a value that when hashed begins with a specific number of zero bits. The work required to accomplish this grows exponentially with the number of zeros desired, and can be verified in a single hashing operation.

Proof-of-work is meant to give each CPU in the network a single vote, where the subject of voting is the validity of transactions.

“The majority decision is represented by the longest chain, which has the greatest proof-of-work effort invested in it. If a majority of CPU power is controlled by honest nodes, the honest chain will grow the fastest and outpace any competing chains.”

Satoshi writes about honest nodes here, where a dishonest node would be a potential attacker on the cryptocurrency’s network. By the mechanisms outlined so far, an attacker would have to redo the proof-of-work of all blocks in a specific chain to overtake the honest nodes’ chain. Through probabilistic algebra outlined in section 11 of the whitepaper, Satoshi showed that this is very unlikely.

Proof-of-work is dictated by a difficulty, which is determined by a moving average targeting a specific number of blocks per hour, so as to avoid the effects of ever improving hardware, among other things. If blocks are generated too fast, the difficulty increases automatically. The goal time per block is 10 minutes, and with the current craze, the difficulty has risen exponentially as global hashing power has flown into the network.

The fifth section of the original bitcoin whitepaper lays out fairly simply how the network approval of transactions should occur.

1) New transactions are broadcast to all nodes.

2) Each node collects new transactions into a block.

3) Each node works on finding a difficult proof-of-work for its block.

4) When a node finds a proof-of-work, it broadcasts the block to all nodes.

5) Nodes accept the block only if all transactions in it are valid and not already spent.

6) Nodes express their acceptance of the block by working on creating the next block in the chain, using the hash of the accepted block as the previous hash.

The longest chain is always assumed to be the correct one, and in times of competing chains of the same length the earliest one received is worked on, while the second one is kept around in case it was actually the correct one all along. When a new block is then approved on one of the chains, this breaks that tie and the shorter chain is then abandoned.

Bitcoin has two main sources of mining incentive. The first is fairly straightforward and is the transaction fee component. For every transaction sent in bitcoin, what is sent is always more than what is received by the designated receiver, and the difference is left to miners as a transaction fee reward. In addition, until all 21m coins are mined, each new block has a coin reward associated with it which are entirely new bitcoins. This reward halves every 210,000 blocks, and is currently projected to halve again from 12.5 coins to 6.25 coins in 2020. As mentioned earlier, the genesis block had a reward of 50 coins, and has already halved twice to the current 12.5 coin/block reward.

The seventh section dives into the fact that all blocks need not be broadcast everywhere all the time, a good thing since the current blockchain of over half a million blocks is well over 100GB of data. Satoshi writes about how some elements of the chain can be pruned over time to reduce the size of the chain passed around to the various bitcoin nodes. Basically, transactions that have been verified and buried under other accepted blocks can start being pruned off without breaking the block’s hash. Using a Merkle tree, the chain can be compacted, which today means a node does not need to store the entire bitcoin blockchain, and instead can run with only several gigabytes of space.

The paper then dives into how a payment is verified. Users on the network, writes Satoshi, do not need to run a full node, and really only need the block headers of the longest chain, which they can ascertain by querying other nodes on the network until they are convinced the longest chain is in hand.

The node can then link a transaction to the block it’s timestamped in, and while the node cannot verify the transaction by itself, by linking it to the network-based chain, other nodes will then broadcast that block containing the linked transaction, and more blocks on top of that will then be added, further verifying the transaction by the network.

As long as honest nodes control the network, says Satoshi, verification is reliable. If a single attacker can overpower the network, however, this malicious actor could verify their own transactions willy-nilly as long as they could continue to overpower the network.

Privacy is a big concern when the ledger of transactions is public. Just like the stock market tape, Bitcoin publicly announces the size and timing of transactions, but the parties involved are not included in the transaction data itself.

Satoshi was a master in obfuscating his own identity, and he even writes that a new public-private key pair should be used for each new transaction, which is not foolproof but can protect owners of transactions from being linked to many transactions should a single one be linked to them.

The 11th section dives into probabilistic math, specifically centred around showing the unlikeliness of a malicious actor being able to overpower the network. Satoshi relies on the assumption that the probability of an honest network node finding the next block is always greater than the probability of a malicious network node catching up, and goes on to show that once the honest chain is far enough ahead of an attacker chain it becomes exponentially more difficult for an attacker to overtake the honest network chain.

Satoshi concludes by stating:

“We have proposed a system for electronic transactions without relying on trust.”

The paper ends by declaring that any needed improvements to the network can be enforced through the voting mechanism used to verify transactions. This is how Bitcoin continues to evolve, years after the mysterious Satoshi Nakamoto disappeared back into the Internet. Bitcoin does rely on trust, however, trust that the software will do what it was written to do. Thankfully, that has definitely been the case so far, with many researchers, including world-renowned security research Dan Kaminsky, being unable to find severe flaws in the system Satoshi built. Who knows if Satoshi will reappear one day, but until then Bitcoin is growing like crazy, and one can only imagine that Nakamoto would be proud of his invention.

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The Ultimate List of Bitcoin and Blockchain White Papers

Want to (really) understand Bitcoin and the blockchain? Read these 30 White Papers.

Bitcoin and the blockchain are fascinating developments that are capturing the imagination of developers, entrepreneurs, investors, governments and consumers. But it’s still made-up of complex pieces.

You can be a passive or active actor in Bitcoin’s future. If you want to be passive, just wait til it develops further. But if you want to be an active actor, you need to understand as many of these pieces as possible, because each one of you is a potential developer, investor, inventor, creator or innovator in the crypto-based ecosystem that is dominated by Bitcoin and its blockchain technology.

In established markets, you need develop new products to gain market attention, and sometimes you do start with a Minimum Viable Product (MVP), and evolve from there. But when the field is uncharted, and the market is undefined, innovation needs to be manufactured by multiple visionaries. So, these visionaries write a White Paper first, (as a sort of MVP) where they describe their vision, and get feedback. Then, they embark on delivering a product later. That’s almost exactly what all Bitcoin and blockchain technology companies have done, including the original creator of Bitcoin, Satoshi Nakamoto.

I’ve been a student of Bitcoin and blockchain technologies for the past 18 months, and still read a fair share of content about it on an on-going basis, in addition to regularly interacting with some of the key innovators that are leading its development and deployment. I can’t emphasize enough that my understanding has deepened the more I read (and often re-read) several of the seminal white papers that pepper this space.

So I’ve compiled a list of the foundational papers and resources that are serving as the basis for the innovation that’s taking place in this segment. Behind each one of these papers, there is either a protocol, an idea, a platform, a product, a service, a marketplace or a dream.

Most of the Protocol related papers require a degree of technical knowledge if you’d like to fully understand them, but you don’t need to be a software developer in order to at least capture some partial understanding. The three categories are presented in descending order of technical content difficulty, so if you’d like to start less technical, start from the bottom of the list.

The Protocols

Bitcoin: A Peer-to-Peer Electronic Cash System (Satoshi Nakamoto, Bitcoin’s inventor)
This is the key paper that started the whole crypto revolution. Even if you only understand 10% of it, you’ve got to read it. It’s like a rite of passage, and it will give you a context for what has happened since this paper was published in 2008.

A Next Generation Smart Contract & Decentralized Application Platform (Vitalik Buterin, Ethereum’s creator)
Arguably, this might be the second most important paper, after Nakamoto’s. Unsatisfied with the original Bitcoin premise, Vitalik Buterin set the bar higher on what cryptography can do to computer science and decentralized applications, and he painted a compelling vision in this seminal paper. Think of Ethereum as a new computing environment with its own stack that’s been optimized for decentralized apps, and you’ll appreciate the future significance of this paper.

Enabling Blockchain Innovations with Pegged Sidechains (Blockstream team)
There are high expectations around sidechains, another key concept that’s supposed to drive innovation around the Bitcoin blockchain, without disturbing its core principles. This paper was authored by nine notable authors and proposes a solution that enables bitcoins and other ledger assets to be transferred between multiple blockchains. Also, see this “Simple Explanation of Bitcoin Sidechains for a less technical interpretation to the same paper.

Ethereum: A Secure Decentralized Generalized Transaction Ledger (Gavin Wood, Ethereum’s co-founder)
A technical paper that takes deeper dives at describing how Ethereum will build and deliver their technology.

The Counterparty Platform (Counterparty)
Counterparty is a platform that’s focused on the financial aspects of a peer-to-peer financial platform that extends Bitcoin’s functionality.

Mastercoin (Mastercoin)
Mastercoin is a protocol layer on top of the Bitcoin network that enables anyone to build their own currency.

Ripple (Ripple Labs)
Ripple is a payment protocol that supports fiat and cryptocurrency, and allows transactions to be settled without the need for a centralized clearing house.

NXT (NXT)
NXT is attempting to build an ecosystem based on its own blockchain, and focused on trustless financial transactions. It includes its own (computing) client and online wallets.

Tendermint (Jae Kwon)
Tendermint is a decentralized consensus engine that runs on its own blockchain.

Pebble (Pebble)
Pebble is an open source project to launch a decentralized cryptocurrency that can support economies for microtransactions and up.

Permacoin: Repurposing Bitcoin Work for Data Preservation (Miller, Juels, Shi, Parno, Katz) A proposal that repurposes Bitcoin mining resources to achieve distributed storage of archival data.

Colored Coins: here are 2 papers to understand this concept, Overview of Colored Coins (Meni Rosenfeld, 2012), and this one.

Satoshi Nakamoto

Abstract. A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. We propose a solution to the double-spending problem using a peer-to-peer network. The network timestamps transactions by hashing them into an ongoing chain of hash-based proof-of-work, forming a record that cannot be changed without redoing the proof-of-work. The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power. As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they’ll generate the longest chain and outpace attackers. The network itself requires minimal structure. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone.

The Bitcoin whitepaper has been translated from English into the following languages:

Read the first draft of the Bitcoin whitepaper (thanks anonymous sender). You can compare the two documents and the changes made using this comparison summary we created.

US Search Mobile Web

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Your search engine does not find any satisfactory results for searches. It is too weak. Also, the server of bing is often off

I created a yahoo/email account long ago but I lost access to it; can y'all delete all my yahoo/yahoo account except for my newest YaAccount

I want all my lost access yahoo account 'delete'; Requesting supporter for these old account deletion; 'except' my Newest yahoo account this Account don't delete! Because I don't want it interfering my online 'gamble' /games/business/data/ Activity , because the computer/security program might 'scure' my Information and detect theres other account; then secure online activities/ business securing from my suspicion because of my other account existing will make the security program be 'Suspicious' until I'm 'secure'; and if I'm gambling online 'Depositing' then I need those account 'delete' because the insecurity 'Suspicioun' will program the casino game 'Programs' securities' to be 'secure' then it'll be 'unfair' gaming and I'll lose because of the insecurity can be a 'Excuse'. Hope y'all understand my explanation!

chithidio@Yahoo.com

i dont know what happened but i can not search anything.

Golf handicap tracker, why can't I get to it?

Why do I get redirected on pc and mobile device?

Rahyaftco@yahoo.com

RYAN RAHSAD BELL literally means

Question on a link

In the search for Anaïs Nin, one of the first few links shows a picture of a man. Why? Since Nin is a woman, I can’t figure out why. Can you show some reason for this? Who is he? If you click on the picture a group of pictures of Nin and no mention of that man. Is it an error?

Repair the Yahoo Search App.

Yahoo Search App from the Google Play Store on my Samsung Galaxy S8+ phone stopped working on May 18, 2018.

I went to the Yahoo Troubleshooting page but the article that said to do a certain 8 steps to fix the problem with Yahoo Services not working and how to fix the problem. Of course they didn't work.

I contacted Samsung thru their Samsung Tutor app on my phone. I gave their Technican access to my phone to see if there was a problem with my phone that stopped the Yahoo Search App from working. He went to Yahoo and I signed in so he could try to fix the Yahoo Search App not working. He also used another phone, installed the app from the Google Play Store to see if the app would do any kind of search thru the app. The Yahoo Search App just wasn't working.

I also had At&t try to help me because I have UVERSE for my internet service. My internet was working perfectly. Their Technical Support team member checked the Yahoo Search App and it wouldn't work for him either.

We can go to www.yahoo.com and search for any topic or website. It's just the Yahoo Search App that won't allow anyone to do web searches at all.

I let Google know that the Yahoo Search App installed from their Google Play Store had completely stopped working on May 18, 2018.

I told them that Yahoo has made sure that their Yahoo members can't contact them about anything.

I noticed that right after I accepted the agreement that said Oath had joined with Verizon I started having the problem with the Yahoo Search App.
No matter what I search for or website thru the Yahoo Search App it says the following after I searched for
www.att.com.

WEBPAGE NOT AVAILABLE
This webpage at gttp://r.search.yahoo.com/_ylt=A0geJGq8BbkrgALEMMITE5jylu=X3oDMTEzcTjdWsyBGNvbG8DYmyxBHBvcwMxBHZ0aWQDTkFQUEMwxzEEc2VjA3NylRo=10/Ru=https%3a%2f%2fwww.att.att.com%2f/Rk=2/Es=plkGNRAB61_XKqFjTEN7J8cXA-
could not be loaded because:
net::ERR_CLEARTEXT_NOT_PERMITTED

I tried to search for things like www.homedepot.com. The same thing happened. It would say WEBPAGE NOT AVAILABLE. The only thing that changed were all the upper and lower case letters, numbers and symbols.
Then it would again say
could not be loaded because:
net::ERR_CLEARTEXT_NOT_PERMITTED

This is the same thing that happened when Samsung and At&t tried to do any kind of searches thru the Yahoo Search App.

Yahoo needs to fix the problem with their app.

Yahoo Search App from the Google Play Store on my Samsung Galaxy S8+ phone stopped working on May 18, 2018.

I went to the Yahoo Troubleshooting page but the article that said to do a certain 8 steps to fix the problem with Yahoo Services not working and how to fix the problem. Of course they didn't work.

Bitcoin Green Whitepaper

Bitcoin Green (BITG) is a sustainable cryptocurrency modeled after Satoshi Nakamoto’s vision for Bitcoin. It is a decentralized, peer-to-peer transactional currency designed to offer a solution to the problematic exponential increase in energy consumed by Bitcoin and other proof-of-work currencies.

Introduction
A Brief Primer on Bitcoin
Proof-of-Work: An Inconvenient Truth
1. Unsustainable Energy Consumption
2. Network Division: Miners vs. Users
3. Low Network Throughput and High Fees
4. Waste of Computational Resources
The Solution: Proof-Of-Stake
Bitcoin Green: The Proof-of-Stake Bitcoin
How is Bitcoin Green Funded?
The Bitcoin Green Foundation
Conclusion
References

Introduction

Satoshi Nakamoto’s vision(1) for Bitcoin has been nothing short of revolutionary in allowing for cross-border peer-to-peer payments and creating the world’s first truly decentralized transfer-of-value network. Bitcoin’s underlying blockchain technology has also led to the creation of numerous decentralized networks which allow for smart contracts, identity protection, administration of intellectual property, supply chain management, and a plethora of other unprecedented innovations.

As public awareness of Bitcoin and blockchain technology increases, so do the cryptocurrency market valuations. Prices steadily increase as more and more investors and speculators begin to understand the true potential value of blockchain technology. Although the technology is promising, there is currently minimal public discourse regarding what steps need to be taken to ensure the long term sustainability, proliferation, and survival of the cryptocurrency ecosystem.

Bitcoin and other proof-of-work blockchain networks are heading towards a cliff. That cliff is unsustainable energy consumption. Bitcoin’s energy consumption is increasing rapidly because it uses a highly inefficient consensus mechanism to secure its network.

Bitcoin Green, the cryptocurrency, is a transactional, daily-use currency designed to provide a scalable and sustainable alternative to Bitcoin. The underlying Green Protocol utilizes a highly efficient proof-of-stake consensus algorithm that solves many of Bitcoin’s sustainability and scalability problems. Furthermore, Bitcoin Green can be mined on any computer or laptop without specialized equipment.

Bitcoin Green, the organization, aims to shed light on a number of critical issues facing proof-of-work based blockchains and raise public awareness for the environmental and economic problems arising from such issues.

A Brief Primer on Bitcoin

Bitcoin was created in 2009 by pseudonymous author Satoshi Nakamoto and is the world’s first implementation of blockchain technology. The Bitcoin network is a large global network of computers connected by the Internet. Each computer is called a node. When someone sends some Bitcoin cryptocurrency, the transaction is beamed out to all the nodes. Each node then independently verifies that the transaction was not fraudulent.

Every few minutes, all the transactions that occurred in that period are bundled together into what is called a block. To fully process the block of transactions and add it to the blockchain, or public ledger of all historic valid transactions, the nodes compete to solve a difficult math problem. The lucky node that arrives at the correct solution first receives a reward of freshly-minted Bitcoin and the block is added to the blockchain, assuming they did not include any fraudulent transactions in that block.

This process of solving a difficult, computationally-intensive math problem is called proof-of-work, and is the consensus mechanism by which the Bitcoin network is secured.

By giving up their valuable computing resources to solve the math problem, nodes are then unable to freely spam the network with blocks containing fraudulent transactions.

Furthermore, in order to fully hijack the network, 51% or more of all the nodes would need to be monopolized, a difficult task given how large the network is.

Miners are the competitors that play in this problem-solving competition: they are nodes compensated for giving up their computing power and verifying transactions. In order to increase the probability that they solve the problem first, and thus increase their profits, miners use extremely powerful computers with processors specially designed to solve Bitcoin’s proof-of-work math problem, the SHA-256 encryption algorithm. To increase their expected profits, miners also operate a large number of these high-powered machines.

Thus, in a mining operation, each computer is powerful and there are a large number of them. In essence, the miners compete by using more and more energy. The economics of mining and proof-of-work has led to exponential and unsustainable growth in the energy consumption of Bitcoin and other proof-of-work networks. This is Bitcoin’s fundamental problem that can, thankfully, be solved by alternatives to the proof-of-work consensus mechanism.

Proof of Work: An inconvenient truth

Multiple critical problems stem from Bitcoin’s inefficient SHA-256 proof-of-work algorithm. Bitcoin is currently facing four major problems:

It requires an unsustainable amount of energy
It splits incentives between miners and all other users
It has high fees and low network throughput
It consumes the world’s valuable computational resources

Bitcoin Green utilizes the Green Protocol, which has been designed to solve all four problems.

Zooming in at the user level, a single Bitcoin transaction consumes enough energy to power over 9 family homes in the United States for 24 hours.(3) As the Bitcoin network grows the block difficulty increases, and in turn the energy required to mine each block also increases. As long as more people use Bitcoin and the number of miners grows, the network will use more and more energy. Bitcoin’s proof-of-work difficulty dynamically changes to ensure block times stay within a narrow range of 10 minutes. The difficulty has increased 1,046% since January of 2014(4) and is continuing to rise exponentially. In December 2017, Bitcoin increased another 18% in difficulty from the previous month.(4) The Bitcoin network currently consumes 37,170,000,000 kWh of energy.(3)

Furthermore, Bitcoin mining accounts for only a portion of all cryptocurrency mining. As other currencies and "altcoins" begin to gain popularity, their mining networks also increase in energy consumption. At the time of this writing, Litecoin consumes 1,445,552,952 kWh per year,(5) which means if it were a country it would fall at number 149, just above Madagascar.(2) Ethereum, the second largest cryptocurrency, consumes 9,880,000,000 kWh per year.(6) Dash, another popular coin, consumes an estimated 1,611,840,000 kWh per year.(7) Although these coins are more efficient than Bitcoin, their net energy consumption is still over a third of Bitcoin’s, and growing fast. All popular proof-of-work coins consume an alarming amount of energy.

If Bitcoin mining growth continues at its current rate, Bitcoin will consume all electricity in the world by 2020.(8) Power that could be used for homes and electric cars will increasingly be redirected to Bitcoin’s massive hardware network, taxing energy grids all over the world. This ridiculous energy consumption is not necessary to secure a blockchain network and is the first and foremost problem Bitcoin Green is aiming to solve.

In the Bitcoin network, users who send Bitcoin can increase the fees they spend to prioritize their transaction. In periods of high network congestion, users have been known to spend significant amounts of money to get their transactions processed. Figure 2 shows how the average US dollar cost of transaction fees and block rewards paid to miners has been increasing since Bitcoin’s inception.(13)

Proof-of-work causes both of these problems indirectly by giving undue power to the miners. For these two reasons—low network throughout and steadily increasing transaction fees, Bitcoin is neither scalable nor sustainable. As cryptocurrency becomes mainstream, Bitcoin fees will only soar higher. These fees make it impossible to cheaply and quickly
transact with Bitcoin.

The Solution: Proof-Of-Stake

Despite the bleak picture painted above, a solution to all aforementioned problems does exists: proof-of-stake. Proof-of-stake is an energy-efficient, scalable, and intuitive consensus mechanism that uses economic incentives to secure a blockchain network. Proof-of-stake mining allows coin holders to mint new coins by holding their coins as collateral in a special staking wallet. In proof-of-work, your mining rewards are proportional to the amount of computing power you control in the network. In proof-of-stake, your mining rewards are proportional to the number of coins you hold in the network. Proof-of-stake miners hold their coin as collateral in a staking wallet, which is a desktop program that can run on any computer. By holding collateral, or a "stake", you prove to the network that you are economically incentivized to follow the network’s protocol. While staking, your staking wallet verifies transactions and mines blocks. When you successfully mine a block you are rewarded just like a proof-of-work miner would be.

In proof-of-stake, block rewards are distributed to coin holders instead of third-party miners. The cryptocurrency’s inflation flows to coin holders in an amount proportional to their staked collateral. This is a key advantage of proof-of-stake. There is no longer a distinction between miners and everyday users. In proof-of-work currencies, the cryptocurrency’s inflation flows to the third-party miners. This means that holders of the coin are hurt by inflation; their ownership of the coin is being diluted by miners. This is the same as how individuals who hold fiat currency have their buying power constantly reduced by central banks that print money. Holding a proof-of-stake currency and staking is the same as if your native country’s central bank sent you an additional 2%, or whatever the inflation rate is, of your fiat holdings every year. Although inflation has not prevented Bitcoin’s and other proof-of-work currencies’ value from rising, all of the inflation has been paid out to third-party miners instead of the holders and everyday users who are naturally the greatest proponents of the currency. With proof-of-stake, all members of the cryptocurrency ecosystem have their economic incentives aligned to improve the network’s technology and encourage widespread adoption, not to slow the network down or make it less efficient to increase profits for mining businesses.

Proof-of-stake works because it requires users to own a very large amount of currency in order to pose a threat to the network. Under proof-of-stake consensus, a user needs to hold more than fifty percent of a currency in order to commit fraud. If a user buys a majority stake and successfully approves fraudulent transactions, everyone else in the network is immediately made aware of this malicious activity. The public would lose confidence in the network and sell their coins, resulting in a significant loss of value for the malicious user. Instead of requiring miners to contribute computing power, proof-of-stake requires miners to post cryptocurrency collateral. In this way, proof-of-stake achieves consensus through economic incentives. Proof-of-stake networks do not require massive amounts of computing power or high-powered hardware, and are therefore extremely energy efficient and fast. Fees are also considerably lower in proof-of-stake cryptocurrencies.(18)

Some of the top blockchain networks currently use a form of proof-of-stake or are planning to switch to it in the future, such as Ethereum.(19) However, most of these major proof-of-stake blockchains are smart contract platforms, not transfer-of-value, deflationary currencies like Bitcoin. Bitcoin Green provides a simple solution to Bitcoin’s scalability problems, and is the first sustainable Bitcoin.

Bitcoin Green: The Proof-of-Stake Bitcoin

The Bitcoin Green team has designed a revolutionary new consensus mechanism which called the Green Protocol. The Green Protocol is energy efficient, extremely fast, and combines proof-of-stake and masternode mining. The purpose of the Green Protocol is to act as a sustainable replacement for Bitcoin’s current SHA-256 proof-of-work algorithm. The Green Protocol employs proof-of-stake and masternode-only mining in combination with fixed block rewards in order to create a fair distribution of coins. Eighty-five percent of Bitcoin Green block rewards for to masternode stakers, 10% to stakers, and 5% goes to the decentralized governance pool (explained below). In this structure each masternode is equally weighted by the Bitcoin Green network, and large wallets do not get unfair benefits from compounding effects. This creates a more equitable mining experience and coin distribution. The total supply of Bitcoin Green is fixed at 21,000,000, just like Bitcoin.

Running a proof-of-stake wallet requires no more than one-tenth of the energy required to run a single Bitcoin miner. Proof-of-stake wallets can also be run on extremely energy efficient computers, such as a Raspberry Pi. Assuming all users are using average desktop computers, the maximum energy consumption of Bitcoin Green is 25,754,400.00 kWh, or 0.06% of Bitcoin’s current consumption. However, this consumption is only possible at max supply with all coins locked in masternodes on separate computers. This is unlikely, and a more modest estimate would put Bitcoin Green at ten to one hundred times less than full consumption. It is more reasonable to assume that Bitcoin Green will only consume 0.0006% – 0.006% of Bitcoin’s current total consumption. Furthermore, it will take many years before consumption is anywhere near this level.

Bitcoin Green has extremely low fees, with an average transaction fee of less than $0.04 (assuming a price of $20,000 per BITG). This is significantly lower than Bitcoin’s current transaction fee of about $25.20

A crucial feature of Bitcoin Green is the decentralized governance protocol. As 5% of the network’s block rewards go to a network-locked address, or pool, the governance protocol allows any masternode to submit a proposal for how to use the pool’s funds and put it up to a vote. The proposal could be for using the pool’s resources to reward developers or community members, fund a foundation, donate to a charity, or any number of endeavors that would serve the Bitcoin Green mission. This ensures the Bitcoin Green ecosystem has a source of funding for perpetuity. Furthermore, the decentralized governance protocol doubles as a voting system that will be used to determine future developments in the network. This system will help prevent forks that destroy critical network effects. Masternode holders will determine protocol decisions and vote to make any necessary changes to the blockchain that will enable the long-term survival and success of the Bitcoin Green network.

Additionally, masternodes on the network allow for PrivateSend and InstantSend. This functionality allows Bitcoin Green to act as an extremely fast and optionally private transactional currency, a use-case simply not possible for Bitcoin given its slow transaction times and high fees. Bitcoin Green features a halving-reward mechanism similar to Bitcoin’s, designed to drive early platform adoption and incentivize early mining. There is also a fair-launch period of approximately one week that ensures everyone has enough time to configure their staking wallets after the initial launch.

Inflation Schedule (Masternode Size: 2500 BITG)

Bitcoin whitepaper

I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party.

Economics of Bitcoin as a Settlement Network
From the settlement layer view, the growing adoption of Bitcoin is increasing its liquidity internationally, allowing it to compete with global reserve currencies for increasingly more valuable transactions, causing transaction fees to rise.

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Satoshi Whitepaper

Bitcoin is a payment exchange medium which was introduced by Satoshi Nakamoto (pseudonym) in 2009 as a software-based online payment system. Below is the paper published by Satoshi detailing the workings of a crytocurrency system that is decentralised and the structure to ensure the security of the system.