Execution of the will of Satoshi Nakamoto

The creator of Bitcoin, who recently revealed himself to the world (presumably), once again stirred up a “cryptocurrency topic” in the media. I wanted to talk about it on Megamind, but not “head on, about a specific person”, but in a more chic, conceptual “cryptocurrency-technological sense”. I found a suitable English-language article about Dash in the topic (IMHO) - the translation of which I publish ...

The legend of Satoshi Nakamoto, the creator of Bitcoin, has reached almost mythical proportions. While the whole world is throwing from one financial crisis to another, this unknown person suggested a radical idea: what if, instead of depending on governments, ordinary men and women who manage everything and determine our financial destiny, we can find some technical solution ? The solution that will challenge the old conventions: a cryptographically secure digital currency that can be trusted because it does not require trust; which can be stable, because it is digital; and which will be created by people, but will not be subject to their whims.
')
At first Satoshi ignored, ridiculed, did not notice, but this only strengthened his mythical image. Despite all the obstacles, the proposed solution - Bitcoin - has become a full-fledged currency, which has the potential to change the world of economics and finance forever.



Satoshi’s mysterious disappearance a few years ago only aggravated the passions around him. In the Bitcoin community, if someone demonstrates the conformity of his ideas with the ideas of Satoshi, then one can be sure of receiving the broadest support. Also, any attempts to change any of Satoshi’s fundamental principles (for example, a limit of 21 million Bitcoin coins) - be sure to be rejected with extreme prejudice. Satoshi’s unconditional devotion helps Bitcoin, and Satoshi’s devotion usually means devotion to his strategy. But like any devotion, it can be erroneous, and what appears to be loyalty to Satoshi’s ideas may in reality become a deviation from them. Bitcoin is in danger, and it is happening right now.

Technological and economic genius

Most people are good at several things at once, but real experts are very, very good only in one thing. Imagine a world-class concert pianist - he may be helpless in mathematics or science, but he is an outstanding expert in his field of competence. Satoshi Nakomoto stands out from this rule, being brilliant in two disciplines at once: technology and economics. A subtle understanding of these two disciplines was necessary to create Bitcoin. Without technological expertise, he could never create a safe, stable digital currency. But without economic knowledge, his technological creation would have been largely useless - the coins would have remained in a narrow circle of geeks, and over time, their fervor would have died ...

Being brilliant in both these areas, Satoshi successfully combined them into a unique synthesis - a technological and economic miracle. It is difficult to overestimate the brilliant invention of Bitcoin.

After the disappearance of Satoshi, Bitcoin development management fell on the shoulders of previously minor project participants. While Bitcoin continues to grow and develop, unfortunately, there are no new Satoshi nearby to manage it. Some of the participants may be outstanding technology experts (perhaps even more advanced than Satoshi himself), while others may be prominent experts in the field of economics. However, without Satoshi, the entire Bitcoin community is responsible for combining these two areas of knowledge in order to develop and strengthen Bitcoin in the spirit of Satoshi’s ideas. Unfortunately, the events of recent months do not inspire hope that the brilliant symbiosis of the economic and technological fields will continue to develop further. It seems that technology experts now determine the path of Bitcoin, but this often happens at the expense of the economic component of the project.



The debate about block size, of course, is the main arena of these discrepancies. What was originally just an anti-spam measure (limiting the block size to 1Mb) has now become a “sacred number” that cannot be changed.
Significant economic problems while maintaining the limit of 1Mb are ignored, with the simultaneous promise of great future technological solutions (Segregated Witness, Sidechains, Lightning network, ...) which, supposedly, will resolve all issues. Instead of realizing that the actions of users determine and personify their economic activity, Bitcoin leaders want to limit transactions in the Bitcoin network by dividing them into “correct” and “spam” transactions that are not worthy of inclusion in the blockchain. Unlike Satoshi, who called on technology to serve an economic strategy, the main developers allow technology to determine the path for the economy.

This changed the economic perception of the project from the “electronic payment system” (as Satoshi called Bitcoin in his original records ) to positioning it as a service technical blockchain-system of the lower level.

Satoshi's retribution

But Satoshi's genius is working now - he laid the Bitcoin “fault tolerance” mechanism, which protects his strategy from “unfriendly takeover”. He made the Bitcoin code open! For this reason, anyone, on any basis, can create their own cryptocurrency in the form of a Bitcoin clone. If Bitcoin deviates too much from Satoshi’s strategy, nothing will stop another person or group of people from creating a cryptocurrency that is more in line with the spirit of Satoshi’s original ideas!



Some people (relying on Satoshi’s dedication) are convinced that Bitcoin and he alone is the digital currency that Satoshi has “approved”. Any altcoin, in their view, is a fraud or technological bankruptcy. But, as I argued earlier , the Alt-Coins are an important part of the cryptocurrency ecosystem, and they, in fact, act as a guarantee for the survival of the original Satoshi strategy.

I singled out for myself three arguments explaining the need for the existence of altcoins. Let me explain them further:

Altcoins provide competition with Bitcoin. I have heard many maximalist arguments for Bitcoin that no cryptocurrency can ever truly compete with Bitcoin. He has always been a winner before. They discard the altcoins as absolutely unworthy discussions, but soon enough they will be preaching in an empty room, taking into account the dynamics with which Bitcoin users go into those “useless” altcoins. Not so long ago, the Bitcoin market occupied more than 90% of the total cryptocurrency market, but now it is less than 80%. Further altcoin innovations will occur at breathtaking speed, while Bitcoin will not be able to change just a single constant.

Altcoins allow you to experiment. Many altkoyunov fail. In fact, most of them will fail. But failure is the first step to success. Without the failures of previous altcoins, confirming the inoperability of some concepts, we cannot know what exactly will become a working technology in the future. By experimenting with small projects, Alt-Coins allow innovation to appear at an accelerated pace.

Altcoins provide niche solutions. Satoshi conceived a peer-to-peer electronic payment system, but the world has come to understand that cryptocurrency and blockchain technology are capable of more, much more. Projects such as Etherium and MaidSafe pushed the boundaries of what we thought about the blockchain. All peremptory rejections of Altcoins are caused by limited thinking and lack of imagination.

Will Bitcoin ever be replaced by another cryptocurrency? I do not know, and no one knows. The most beautiful thing about this is that none of the possible leaders can count on a quiet life - leadership can shift from one currency to the next candidate, depending on how well the currency meets the needs of the market. I believe that there will be many winners, because cryptocurrency technology can be used to solve many real-world problems of this world.

But is there such an alternative cryptocurrency, which is able to realize Satoshi's vision of the “electronic payment system” and argue with the dominance of Bitcoin itself? There are several applicants, but of them the project that, in my opinion, has the greatest potential is Dash . It was created in order to eliminate the weaknesses of Bitcoin, based on its advantages.



Dash: Satoshi's strategy execution?

Now, when Bitcoin exists for more than seven years, its strengths and weaknesses have emerged. For a project that was initially ignored and then ridiculed in the financial world (and the obituary for which was written countless times), Bitcoin is surprisingly flexible. He showed the world that the blockchain technology works, and, in some cases, works surprisingly well! He solved the problem of exchange of funds between strangers without intermediaries. Those of us who are following the Bitcoin project sometimes need to look at it from the outside and be surprised at the whole multitude of new possibilities that have opened up with it. This is truly a technological and economic miracle!

However, the last 7 years have also revealed several Bitcoin weaknesses. Here are the main ones:

one). Scalable . Bitcoin, in its current state, is not able to process the number of transactions that is necessary for this global payment network. How the network's capacity can be increased, the heated debate does not abate, which leads us to the next weakness.

2) Management . As was clearly demonstrated in the current debate on the size of the block, attempts to scale Bitcoin are fraught with disagreements and exchange of barbs (so far without real changes). Decision making powers have focused on several major developers, supported by a small number of miners, with a small representation of the interests of the majority of Bitcoin users who do not have the ability to influence project management.

3) Slow confirmation. A real payment system should be instantaneous, however, for Bitcoin transactions, it takes an average of 10 minutes to become secure (confirmed), which is unacceptable for commerce in the 21st century. Recently, the first confirmation may take a lot more due to the increase in (growing) network difficulties.

4) Anonymity . Bitcoin was never truly anonymous, only pseudo-anonymity was achieved. However, to ensure complete interchangeability (the key quality of real money), the currency must be truly anonymous. It is absolutely unimportant whether the drug dealers, pedophiles, or politicians have used the cryptocurrency before — these coins should cost as much as the coins used by most clean hands. In addition, the record of transactions in the public blockchain has negative sides, such as the inability of companies and individuals to protect their financial information from prying eyes.

5) Ease of use . Bitcoin is still in an early stage of development and, strictly speaking, it is still difficult to use by the common man. But since Bitcoin got into the mass consciousness (around the end of 2013), promises to improve ease of use have remained only in general terms, while there has been no real improvement. It’s easy to talk about such a complex topic as simplifying the use of Bitcoin, but it’s hard to do something concrete.

Dash, being a fork of Bitcoin, has absorbed all the advantages of an older brother, but let's see how he behaves when it comes to Bitcoin's weaknesses.

1. Masternod network . Dash introduced an innovative two-tier network of nodes that strengthened the cryptocurrency. These “Masternodas” are stimulated, receiving a portion of the reward for the unit, and, as a rule, they are able to be more powerful and more stable than ordinary Bitcoin nodes. Thus, Masternody allow you to scale much more efficiently Bitcoin. The Masternod Dash network allows Dash to embed other, more powerful functions into the cryptocurrency than those that ordinary nodes can provide, as we will see in the following 3 features.

2. Decentralized management . Dash is, in fact, more adaptive than Bitcoin, because it has a built-in consensus mechanism for making changes to the project based on the mastersnot’s vote. Ongoing intractable debates, such as the block size limit, can be resolved by a routine, completely decentralized method. This allows innovations to grow rapidly in line with market requirements and current technological needs.

3. InstantX . Dash implemented a secure instant transaction confirmation mechanism (less than 4 seconds). InstantX blocks the possibility of double spending using Masternody - as a result, transactions are considered safely confirmed even before they are confirmed in the blockchain.

4. Privacy protection . Formally known as DarkSend, PrivacyProtect is a feature that allows users to anonymize their Dash funds. Unlike Bitcoin, whose transactions can be traced through the blockchain, PrivacyProtect, in fact, allows you to hide the source and destination of remittances.

5. Evolution . Currently in development, Evolution is the next generation of Dash, which focuses on user convenience. For example, instead of sending money to a long alphanumeric address, the user will be able to use the naming system to transfer funds. Forwarding cryptocurrency will be as easy as sending a message to a friend.

Dash offers a lot of amazing things, but it also needs to be noted that this cryptocurrency is still in the “childish stage” (it’s just over 2 years old) and still has a small user base. Its capabilities have not yet been used to the extent that it can reveal its own unique weaknesses. But, like Bitcoin, Dash has an open source code that allows all innovations to be copied and used in other cryptocurrency projects. Thus, Dash, like Bitcoin, must continually innovate and improve, moving towards the needs of users in the real world if it wants to maintain high growth rates.



Satoshi’s strategy to develop a peer-to-peer electronic payment system requires both technological and economic knowledge. Hardly anyone else can fully replace Satoshi. However, due to the open nature of cryptocurrency, its strategy can be adapted and implemented by any interested person, and the market will decide for itself which project best fits the universal needs.

The future peer-to-peer electronic payment system may not have the name Bitcoin, but Satoshi’s strategy will still define its important features.

(For fans of “minus”, I remind you that I am not the author, the article is transferable. I would be grateful for the support of the translation efforts into Russian. Thank you!)