Bitcoin

5P;1R — Bitcoin’s Elliptic Curve Cryptography This is the first of a potential series of articles I want to call “ 5 points & 1 resource” (think tl;dr but 5p;1r) where I summarize a list of bullet points that would have helped me start learning a new topic. It is intentionally far from a complete source of data. This is an Elliptic Curve : y^2 = x^3 + ax + b; see the continuous function Image 1. Elliptic Curve Cryptography is defined over a Finite Field (very large prime) p along with a Generator Point((x,y) coordinate) G like so : y^2 ≡ (x^3 + ax + b) mod p ; see the scatter plot Image 2. Bitcoin uses a secp256k1 , which is an Elliptic Curve with carefully selected parameters to achieve certain security guarantees: • a=0 • b = 7 • p = 2^256 - 2^32 - 2^9 - 2^8 - 2^7 - 2^6 - 2^4 - 1 • G = 04 79BE667E F9DCBBAC 55A06295 CE870B07 029BFCDB 2DCE28D9 59F2815B 16F81798 483ADA77 26A3C465 5DA4FBFC 0E1108A8 FD17B448 A6855419 9C47D08F FB10D4B8 A public key P (a point on the curve) is just a private key pk(a random integer) multiplied by the Generator Point ( the pre-selected point on the curve): P = pk * G. The Elliptic Curve Discrete Logarim Problem makes it hard to find the integer pk when you know (x,y) coordinates of P and G fitting the equation in (2) using the parameters in (3) or some other elliptic curve. If I only had to recommend one resource out of all the references I looked through, it would be: https://cryptobook.nakov.com/asymmetric-key-ciphers/elliptic-curve-cryptography-ecc#the-generator-point-in-ecc ...

It’s difficult to objectively quantify Bitcoin’s adoption rate since there are too many factors to consider. Should it be the number of people holding Bitcoin? Bitcoin’s market cap? The number of brokerages with support for Bitcoin futures? The number of businesses accepting it as form of payment? A very different story can be told depending on the angle from which you look at it. Bitcoin’s market cap As a potential store of value, Bitcoin’s market cap needs to be sufficiently high for institutions and central banks to take it seriously. Governments must add some regulation around it so it has legitimacy, and a large enough portion of the general population must agree that it has inherent value. To agree that it has value, Bitcoin is very dependent on network effects such as those described by Metcalfe’s Law. ...

One of the major selling points of cryptocurrencies is that everything is decentralized and trust no longer lies in single a third party. However, the trust didn’t simply dissipate, it got distributed to participants of the network. In my opinion, the incentive structure built into cryptoeconomics is one of its most overlooked benefits. The fundamental idea can be summarized as follows: no one wants to lose money, and everyone wants to maximize the profit they receive for the work that they do. ...

This post was originally written as a follow up email to this tweet where one of the hosts of The Investor’s Podcast ran a poll regarding people’s thoughts on Bitcoin. — — — — — — — — — — To provide a fair comparison between Ethereum and Bitcoin I will start by defining the basics, and expand on how each of them can be used without drilling down too deep into the technical details ...