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These are the slides from my May 2011 Talk at KPMG Zurich for "Netzzunft.ch".
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What is Bitcoin? A look at the world’s first cryptocurrency.
Stefan Thomas • WeUseCoins.com
physical money
physical money (direct transfer)
physical money “peer-to-peer”
online
online
online
online
intermediary
intermediary
middle man
intermediary
middle man = cost
intermediary
middle man = cost risk
intermediary
middle man = cost risk no choices
intermediary
middle man = problem
intermediary
intermediaries distributed
intermediaries distributed
cost?
intermediaries distributed
cost?
intermediaries distributed
cost?
intermediaries distributed
cost?
intermediaries cost
distributed
intermediaries cost risk?
distributed
intermediaries cost risk?
distributed
intermediaries cost risk?
distributed
intermediaries cost risk
distributed
intermediaries cost risk choices?
distributed
intermediaries cost risk choices
distributed
intermediaries (current situation)
semi-distributed
intermediaries is it possible?
distributed
step 1: Decentralizing identity.
Martin Hellman Ralph Merkle Whitfield Diffie
1976
Solved. Solved. Sincerely,
Martin Hellman Ralph Merkle Whitfield Diffie
1976
Sincerely,
Solved. Solved. (with digital signatures)
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 2: Decentralizing accounting.
step 3: Decentralizing truth.
step 3: Decentralizing truth.
step 3:
A B
Decentralizing truth.
step 3: Decentralizing truth.
A B
Voting?
B
B B B B
B
step 3: Decentralizing truth.
A B
Voting? Problem: Fake nodes!
B
B B B B
B A A
A A A
A A
A A A
A A A A
A A A
A A A A
A A
A A A
A A A
A
A A A A
A A
A A A A A A
step 3: Decentralizing truth.
A B
Bitcoin’s most important idea:
B
B B B B
B
step 3: Decentralizing truth.
A B
Bitcoin’s most important idea:
B
B B B B
B
“1 CPU, 1 Vote”
so... would it take? how much
hashing power
hashing power
Disclaimer: FLOPS ≠ FLOPS
hashing power
hashing power as of 24/5/2011
3500 Ghash/s three-day window estimate
hashing power as of 24/5/2011
3500 Ghash/s three-day window estimate
hashing power as of 24/5/2011
3500 Ghash/s three-day window estimate
hashing power as of 24/5/2011
3500 Ghash/s = 29.05 PFLOPS three-day window estimate
hashing power as of 24/5/2011
4.7 5.14
29.05
Tianhe-1A Folding@home Bitcoin
all values are in PFLOPS
Sources: bitcoin.sipa.be/speed-lin.png fah-web.stanford.edu jcst.ict.ac.cn
hashing power
hashing power A realistic view of hashing attacks against Bitcoin.
hashing power A realistic view of hashing attacks against Bitcoin.
Capital: ~ 8000 Radeon 5870 GPUs
hashing power A realistic view of hashing attacks against Bitcoin.
Capital: ~ 8000 * 250$
hashing power A realistic view of hashing attacks against Bitcoin.
Capital: ~ 2 000 000$
hashing power A realistic view of hashing attacks against Bitcoin.
Capital: ~ 2 000 000$
Power: ~ 220W * 8000
hashing power A realistic view of hashing attacks against Bitcoin.
Capital: ~ 2 000 000$
Power: ~ 1.76 MW
Benefit: Stopping transactions/Double spends
step 4: Decentralizing issuance.
step 4: Decentralizing issuance.
Who gets to spend new coins?
step 4: Decentralizing issuance.
M M ... Money awarded F ... Work provided
F
money supply 21 million max.
15 mil.
10 mil.
5 mil.
money supply
Currently: 6.28 mio
decentralized
identity
accounting
truth
issuance
decentralized currency
economy
economy
economy
Source: BitcoinCharts.com
economy
Source: https://en.bitcoin.it/wiki/Trade
Excerpt: Design & Webhosting
economy
Source: https://en.bitcoin.it/wiki/Bitcoin_Map http://www.weusecoins.com/globe-bitcoin/
economy Existing Services • Escrow, e.g. ClearCoin • Online Wallet, e.g. Instawallet.org • Trial Service, e.g. Bitcoin Faucet • Wallet Backup, e.g. Wuala • Press, e.g. Bitcoin Sun • Mining Pools, e.g. Deepbit
Many more in the works...
decentralized
identity
accounting
issuance
truth
applications DDNS
Other Currencies Notarization
Deeds Web-of-trust
DPKI eVoting
Great Thing: Shared Work
applications
thanks! for listening
questions?
