Recognize BitGold

Recognize BitGold
Recognize BitGold

Know BitGold – Influencing Many Cryptocurrency Travels In Its History

Bitgold . Cryptocurrency is carved with a long travel process. Through the winding process, try and error. There have been many experiments done. Of the many experiments, most of them failed. One of them is BitGold . Precisely at the end of 2008 , Nick Szabo introduced BitGold.

Before Bitgold, in the same year, there was also an idea that was carried by Wei Dai, b-money . Although BitGold and b-money are deadlocked, they have ultimately influenced the development of cryptocurrency, including Bitcoin. Especially in the branch of cryptography.

Some time ago, Nick Szabo tried to open the history of the journey of cryptocurrency. He rewrote the memory of his findings on his personal twitter account. For people in the crypto community, his name does enter as a figure who allegedly owner of the name pseudonym “Satoshi Nakamoto”.

Nick Szabo Bitgold
Nick Szabo Bitgold

But in this discussion, the Cloud Faucet Net will not discuss details about it. Cloud Faucet Net  only tries to look at the relation relationships of several supporting reasons as its background only. This discussion, will be more try to see back to back, how exactly BitGold at the time. What are the differences with Bitcoin, and how it can affect Bitcoin in the end.

BitGold Background

Szabo behind the idea of ​​BitGold started when he saw that the value of the currency is quite dependent on third parties. One of the disadvantages is certainly on the issue of inflation rate is increasingly unstoppable. Someday it will be a time bomb that just waiting for countdown time only. Although no one will be able to predict when it will happen, but hyperinflation will not be inevitable.

If FIAT Money is compared to precious metals, on precious metals there is a scarcity nature of its creation. Of course, the precious metal mining process must be done with great effort, costly. The precious metals availability resources are also limited. Quite different from Fiat Money properties that can be created with an unlimited amount.

In addition to being limited, precious metals are also more independent, less dependent on third parties to be trusted. Different from Fiat Money that the process of creation through certain parties or institutions that legitimized as an official publisher.

Unfortunately this precious metal also has many problems to be used as a means of payment. If this precious metal is used for such transactions in general, it will certainly require a third party. This third party usually deals with the tax collector to be paid for the transaction. There is also a tax charge when converting the precious metal into a coin.

Another problem, is when transporting the precious metal in a tranasksi. The process is, becoming quite vulnerable, quite unsafe. Nick Szabo exemplifies when Britain was transporting gold to Canada during World War I. At the time, Britain was working on a gold standard. And the exact conditions of the time, of course there is still no findings online payment that can facilitate them.

These are the things behind Nick Szabo on BitGold. Trying to create an online payment by minimizing third party dependency. Attempting to make possible transactions to be safely stored, and also capable of being transferred.

BitGold System

Nick Szabo, tried to try to make the same system, like the properties that resemble the precious metal of gold. Start with the difficult production process, proof of one’s contribution that he has produced a new unit, and improve security by adding some cryptographic features.

Here’s more details that are in Nick Szabo’s thoughts about BitGold at that time:

  1. A public string bit as a challenge to go through. Its function is as a safeguard.
  2. Proof of work is generated from the computation of the bit string.
  3. Proof of work with timestamp .
  4. Adds string and timestamp proof of work to transaction. And the most interesting is, there is no single server.
  5. Creates bitgold strings, which need to be done to produce new units.
  6. There is verification of coin owner with digital signature.
  7. Other people can check and verify bits, string proof of work, and also timestamp on the transaction.

At a glance from the idea, we see it will be quite similar to Bitcoin is not it? There is a big difference there. We will continue later on the fundamental difference. But in the shadow of that thought, it appears that it will work well.

In the proof of work above, Szabo refers Hal Finney’s work on Reusable Proof of Work (RPOW). To patch some things, the proof of work is spiked with timestamp . Its function is of course used as a timepiece. Shows evidence of when the proof of work was produced in accordance with the degree of difficulty at the time of computing performed at a certain time. At the creation of a new unit, it is done also with puzzle computing.

The fundamental difference between BitGold and Bitcoin

  • The bitgold proposal then, is still unofficial. Because it is posted in a series of blogs. While Bitcoin is published in the form of whitepaper.
  • The bitgold proposal also does not include the full specifications, codes, and details of problems that may arise and how to solve them. Bitcoin includes detail specifications along with the code.
  • Puzzles are only used to secure block chains. In Bitcoin, puzzles are used directly for the formation of new bitcoin units.
  • Puzzle bitgold can not adjust the difficulty level periodically. While the Bitcoin puzzle has been there a mechanism that can adjust the difficulty level periodically. If there is no difficulty level mechanism that adjusts the conditions, it can lead to the easy creation process. Up to the end, it can trigger a loss of currency value, if to make a new unit of coin it is considered to have been too easy and constant.
  • Bitgold is created unlimited, and Bitcoin is limited.
  • Bitgold relies on timestamp feature in signing new coin units as well as on transfer. While Bitcoin is not, the timestamp is only used to arrange block and transaction sequences.

The reason Nick Szabo was considered as Satoshi Nakamoto

The explanation of this reason is just a few things that underlie why Nick Szabo was considered as Satoshi Nakamoto. But not as an attempt to try to find out who Satoshi Nakamoto really is.

As explained above, that the idea of ​​Nick sabo about Bitgold since 1998. Unfortunately the idea was never on the internet, until then in 2005. Some think, it seems as if deliberately done.

Nathaniel Popper
Nathaniel Popper

The BitGold proposal that should have been around since 1998, seemed to be overwhelmed and then rewritten. Precisely, about two months after the new Bitcoin released by Satoshi Nakamoto. There was a New York Times reporter, named Nathalie Popper. He wrote the incident in his book Digital Gold: Bitcoin and the Inside Story of the Misfits and Millionaires Trying to Reinvent Money .

Popper considers, as if there was a deliberate scenario to close the reference to Bitgold, until Satoshi later published Bitcoin. Of course Popper compared that with other observers.The result, many other observers who give a similar tone, assumes there is a possibility that Nick Szabo is Satoshi Nakamoto.

According to Popper, both Szabo and Satoshi, as if trying to ensure that later, others will realize it, based on pre-existing proposals. While it could be Sathosi itself, provide a reference not on bitgold but Wei Dai on b-gold, because then the proposal bitgold tertindih.Besides of course, Satoshi’s main reason is enough to understand that bitgolds are pretty much different. And at that time, there was only one that could be referenced, ie Wei Dai’s proposal about b-money.

When Nick Szabo attempted to reopen Bitgold’s history, was it possible he was trying to recall the old proposals before the Bitcoin? Only time will answer it.

Cloud Faucet Net

Cloud Faucet Net

Cloud Faucet Net is an online medium for sharing knowledge and information about Bitcoin and cryptocurrency. It was first established in March 2017. Hopefully, it can be used as a source of information as well as a reference to the addition of useful knowledge, related to Bitcoin and the technology that surrounds it.

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