The Book Of Satoshi: The Collected Writings of Bitcoin Creator Satoshi Nakamoto

358 Pages·2014·3.52 MB·English

by  Phil Champagne

t h e b o ok of
satoshi
The Collected Writings of Bitcoin Creator
Satoshi Nakamoto
phil cha mpagne
foreword by jeff berwick
t h e b o o k o f
Satoshi
t h e b o o k o f
Satoshi
<<<< > >>>
The Collected Writings of Bitcoin Creator
Satoshi Nakamoto
Phil Champagne
E53 PUBLISHING LLC
Copyright © 2014 by Phil Champagne, All rights reserved.
The part of this book’s content that comes from Internet forum is in the public
domain. I give full rights to anyone to copy and distribute electronic copies of this
book, either in part or in full.
Published in the United States of America by e53 Publishing LLC
ISBN 978-0-9960613-0-8 Hardcover
ISBN 978-0-9960613-1-5 Softcover
e53 Publishing LLC
e53publishing.com
Cover illustration by Lisa Weichel
Editing by Mary Graybeal
Cover and text design and composition by John Reinhardt Book Design
This book is also available in eBook format.
To get a free copy, please go to: BookOfSatoshi.com
Contents
About the Cover Picture xi
Acknowledgments xiii
Who This Book Is Intended For xv
Foreword xvii
1. Introduction 1
2. How and Why Bitcoin works 9
3. The First Post on Crypto Mailing List 33
4. Scalability Concerns 35
5. The 51% Attack 39
6. About Centrally Controlled Networks
Versus Peer-to-Peer Networks 43
7. Satoshi on the Initial Inflation Rate of 35% 45
8. About Transactions 49
9. On the Orphan Blocks 55
v
THE BOOK OF SATOSHI
10. About Synchronization of Transactions 57
11. Satoshi Discusses Transaction Fees 61
12. On Confirmation and Block Time 63
13. The Byzantine General’s Problem 67
14. On Block Time, an Automated Test,
and the Libertarian Viewpoint 71
15. More on Double Spend, Proof-of-Work,
and Transaction Fees 75
16. On Elliptic Curve Cryptography, Denial of Service
Attacks, and Confirmation 81
17. More on the Transaction Pool, Networking
Broadcast, and Coding Details 85
18. First Release
of Bitcoin 89
19. On the Purpose For Which Bitcoin Could
Be Used First 93
20. “Proof-of-Work” Tokens and Spammers 97
21. Bitcoin Announced on P2P Foundation 99
22. On Decentralization as Key to Success 103
23. On the Subject of Money Supply 105
24. Release of Bitcoin v0.1.3 107
25. On Timestamping Documents 109
vi
Contents
26. Bitcointalk Forum Welcome Message 111
27. On Bitcoin Maturation 113
28. How Anonymous are Bitcoins? 117
29. A Few Questions Answered by Satoshi 121
30. On “Natural Deflation” 127
31. Bitcoin Version 0.2 is Here! 131
32. Recommendation on Ways to Do a Payment
For an Order 133
33. On the Proof-of-Work Difficulty 135
34. On the Bitcoin Limit and Profitability
of Nodes 139
35. On the Possibility of Bitcoin Address Collisions 143
36. QR Code 145
37. Bitcoin Icon/Logo 147
38. GPL License Versus MIT License 151
39. On Money Transfer Regulations 153
40. On the Possibility of a Cryptographic Weakness 155
41. On a Variety of Transaction Types 159
42. First Bitcoin Faucet 163
43. Bitcoin 0.3 Released! 167
44. On the Segmentation or “Internet Kill Switch” 169
vii
THE BOOK OF SATOSHI
45. On Cornering the Market 175
46. On Scalability and Lightweight Clients 177
47. On Fast Transaction Problems 179
48. Wikipedia Article Entry on Bitcoin 183
49. On the Possibility of Stealing Coins 187
50. Major Flaw Discovered 203
51. On Flood Attack Prevention 205
52. Drainage of Bitcoin Faucet 213
53. Transaction to IP Address Rather than
Bitcoin Address 217
54. On Escrow and Multi-Signature Transactions 219
55. On Bitcoin Mining as a Waste of Resources 233
56. On an Alternate Type of Block Chain with
Just Hash Records 241
57. On the Higher Cost of Mining 267
58. On the Development of an Alert System 271
59. On the Definition of Money and Bitcoin 277
60. On the Requirement of a Transaction Fee 285
61. On Sites with CAPTCHA and Paypal Requirements 289
62. On Short Messages in the Block Chain 293
viii
Contents
63. On Handling a Transaction Spam Flood Attack 297
64. On Pool Mining Technicalities 301
65. On WikiLeaks Using Bitcoin 309
66. On a Distributed Domain Name Server 313
67. On a PC World Article on Bitcoin and WikiLeaks
Kicking the Hornet’s Nest 325
68. Satoshi’s Last Forum Post: Release of Bitcoin 0.3.19 327
69. Emails to Dustin Trammell 329
70. Last Private Correspondence 341
71. Bitcoin and Me (Hal Finney) 343
72. Conclusion 347
Bitcoin: A Peer-toPeer Electronic Cash System 351
Terms & Definitions 367
Index 371
ix
About the
Cover Picture
CREDIT FOR THE IMAGE on the front cover goes to Lisa Weichel
(user id lisa_aw on flickr.com). The photo was taken at Cueva de las
Manos (Cave of Hands) in the province of Santa Cruz in Argentina.
Cueva de las Manos is a series of caves famous for the various paint-
ings of human hands covering its walls. The paintings, the earliest of
which date from around 13,000 years and the latest from about 9,000
years ago, were left there by multiple generations.
I selected it as this book’s cover image because it seems to me to
embody many of the concepts underlying Bitcoin—many individuals
participating and cooperating to attain, over time, a common goal and
yet maintaining their own individuality and uniqueness. Bitcoin dif-
fers from the cave paintings of Cueva de las Manos in scale, however.
Although these paintings were produced by multiple generations of
individuals over several thousands of years, the number of these artists
can’t compare in size to the millions who now and will in the future
use Bitcoin. Moreover, Bitcoin’s users are geographically dispersed,
collaborating over a decentralized system. Finally, whereas Cueva de
las Manos was the work of one or more distinct tribes of humans, Bit-
coin, open to anyone to use and adapt, transcends nationality and has
the potential to become a true world currency.
xi