《Bitcoin white paper》Technical interpretation
The technical index of stock is relative to the basic analysis. The basic analysis method focuses on the analysis of general economic situation, operation and management status of each company, industry dynamics and other factors to measure the level of stock price. Technical analysis, on the other hand, studies market behavior responses through charts or technical indicators to speculate on price trends. The emerging white papers on digital currencies can also be interpreted in the same way. Having analyzed the fundamentals of the bitcoin white paper before, let's talk about technology today._DJMINER
It is such an electronic payment system, which is based on the principle of cryptography rather than credit, so that any agreed parties can pay directly without the participation of a third-party intermediary. Eliminating the possibility of rolling back payment transactions can protect specific sellers from fraud, and for those who want to protect buyers, it's easy and pleasant to set up a normal third-party guarantee mechanism in this environment.
This is a definition of special currency in the white paper. In a word, it is a point-to-point e-cash system.
Analysis: almost all trade on the Internet needs to rely on financial institutions as a trusted third party to process electronic payment information, so it can not achieve completely irreversible transactions. The existence of financial intermediary will also increase the transaction cost, and in the actual business behavior, a certain proportion of fraud is also considered inevitable. Based on various current situations, Mr. Nakamoto developed bitcoin by using cryptography principle rather than the third-party credit system with high human factors. What is the most valuable thing? Anything in need is valuable. As a key to solve the problem, bitcoin has undoubtedly become the pioneer of blockchain technology._DJMINER
The total number of bitcoin is 21 million, and the final number of bitcoin is 0999997690000, which is a little less than 21 million.
This monetary system will be free from inflation.
At 18:15:05 on January 3, 2009, Greenwich mean time, the genesis block was born. The number of Genesis block is 0. From "stage 1" of Genesis block, each block generates 50 new bitcoins or 5 billion Cong.
Target height 210000
At 15:24:38, November 28, 2012, Greenwich mean time, 210000 blocks were generated. In "stage 2" from this block, the number of new bitcoins contained in each block was halved to 25, the first time in history. For every 210000 blocks generated in the future, the number of bitcoins will be halved in turn. Until the 33rd half reduction, each block produced 0.0021 new bitcoin directly reduced to 0.
Once every four years
Halving every four years is not very strict. Reality: bitcoin generates about one block every 10 minutes, while 210000 10 minutes are close to four years. Analysis: we found that from 2009 to 2011, when bitcoin was born, bitcoin had a very low demand for mining equipment. You can even dig with a smart phone, and the revenue is not bad. Maybe an engineer is on the night shift and is bored to start the software. After sleeping, he can dig hundreds of thousands of bitcoins, but the bitcoin is not worth a dime. As time goes on, the difficulty of bitcoin mining is directly proportional to the amount of money that has been mined out. The more difficult it is to mine in the future, by 2030, when 20 million bitcoins are mined out, the remaining 1 million bitcoins will probably take decades to be mined out. According to the original design, bitcoin will eventually reach the limit of 21 million in 2140. This mechanism determines that the more people it produces in the future, the more difficult it will be to produce, and the cost of production difficulties will increase sharply, which will promote the market price (production is also carried out according to the procedures, known as gold mining). This is the investment attribute of money. Later, unless bitcoin is worth more than mining, I guess more and more people will retire from mining._DJMINER
In the white paper, the incentive mechanism is described as follows: the first transaction of each block is specialized, and the transaction generates a new electronic currency owned by the block creator. In this way, the incentive of nodes supporting the network is increased, and a method to distribute electronic money to the circulation field is provided when there is no central authority to issue money. This method of continuously adding a certain amount of new money to the monetary system is very similar to using resources to mine gold and inject gold into the circulation field. At this time, CPU time and power consumption are the consumed resources Another source of incentive is transaction fee
Fees). If the output value of a transaction is less than the input value, the difference is the transaction fee, which will be added to the block's incentive. As long as a certain amount of electronic money has entered the circulation, the incentive mechanism can be gradually converted to rely on transaction costs, so the monetary system can be free from inflation.
Analysis: the total number of 21 million is capped, bitcoin is generated by mining through internal circulation, and transaction scenarios are provided for bitcoin through external circulation. If there are a large number of bitcoin holders, a deflation model will be formed to drive the stable value-added of bitcoin.
1. Public chain sends token. A total of 21 million tokens are issued based on its own public chain. Typical decentralized applications form a trust mechanism;
2. Inner circulation mining. Bitcoin belongs to the typical digital currency, which belongs to the account book of distributed bookkeeping. Bitcoin has no direct use scenario. The mining method is through calculation, and the maximum cost of mining is electricity fee;
3. External circulation. After bitcoin transaction through the exchange, the circulation of the external circulation is completed, which brings circulation value to the internal circulation miners. If the circulation price is higher than the mining cost, it brings investment income to the miners;
4. Internal and external integration. After the completion of bitcoin mining in 2040, bitcoin is mainly obtained through exchange trading;
Bitcoin is a kind of "decentralized" electronic currency, which theoretically ensures that no one, institution or government can control the total amount of bitcoin or create inflation. All of the above, bitcoin, which is the number one digital currency, has a certain market because of its scarcity and supply is less than demand.
On May 21, 2010, the story of an American programmer buying pizza with 10000 bitcoin spread widely. At that time, the transaction price of a bitcoin was less than 1 cent. This is the first time bitcoin has been used as a payment tool in the real world. At today's price, 10000 bitcoin is enough to buy a luxury estate, which is also known as "the most expensive pizza in history". Over the next few years, more and more bitcoin enthusiasts began to try to buy various products with bitcoin. By 2017, bitcoin had set a record high price, with a maximum value of about $20000. According to data from the coindesk digital currency trading platform, the price of bitcoin once fell below $6000 in 18 years, 70% lower than the highest value of $20000 in 2017 The price of bitcoin at its peak is too inflated, so it is inevitable that it will fall. Its current price is basically around $6000, but in the long run, the future of digital currency is worth looking forward to._DJMINER
Analysis: there is no doubt that bitcoin ranks first in the circulation market value. The higher the market price ratio, the more stable the position of bitcoin in the blockchain market, and the greater the weight of technology and team. The turnover rate is the first, which reflects that the demand for currency in the mass market is higher than other tokens. And there are 200 exchanges on the market, so as long as there are exchanges, there will be bitcoin. Of course, now the overall digital currency is in a bear market, at least holding the first bitcoin, the security is much higher.
As long as you know that the blockchain knows the digital currency, you can't escape bitcoin. No matter what the market price is, bitcoin is also the first one to be talked about by the market media, so its number of users and activity are basically clear at a glance.
Bitcoin can be regarded as a masterpiece of cryptography. The verification principle of bitcoin's working mechanism is quite complex, which is still incomprehensible to most people, and various debates about bitcoin have been ongoing. However, in any case, as a epoch-making product, especially its underlying technology blockchain (blockchain is a new application mode of computer technology such as distributed data storage, point-to-point transmission, consensus mechanism, encryption algorithm), is now a major direction of active layout of numerous countries and enterprises. More and more cryptocurrencies have been and continue to be produced by the gene of "bitcoin", forming a "cluster" of cryptocurrencies, and traditional wealth began to transform into digital wealth. The future is in our own hands. We hope that while we continue to pay attention to bitcoin, we can think independently about its overall impact on the economy and society and make our own independent judgment._DJMINER
Project Description: what is this project for?
It is such an electronic payment system, which is based on the principle of cryptography rather than credit, so that any agreed parties can pay directly without the participation of a third-party intermediary. Eliminating the possibility of rolling back payment transactions can protect specific sellers from fraud, and for those who want to protect buyers, it's easy and pleasant to set up a normal third-party guarantee mechanism in this environment.
This is a definition of special currency in the white paper. In a word, it is a point-to-point e-cash system.
Analysis: almost all trade on the Internet needs to rely on financial institutions as a trusted third party to process electronic payment information, so it can not achieve completely irreversible transactions. The existence of financial intermediary will also increase the transaction cost, and in the actual business behavior, a certain proportion of fraud is also considered inevitable. Based on various current situations, Mr. Nakamoto developed bitcoin by using cryptography principle rather than the third-party credit system with high human factors. What is the most valuable thing? Anything in need is valuable. As a key to solve the problem, bitcoin has undoubtedly become the pioneer of blockchain technology._DJMINER
Economic model: bitcoin issuance
The total number of bitcoin is 21 million, and the final number of bitcoin is 0999997690000, which is a little less than 21 million.
This monetary system will be free from inflation.
At 18:15:05 on January 3, 2009, Greenwich mean time, the genesis block was born. The number of Genesis block is 0. From "stage 1" of Genesis block, each block generates 50 new bitcoins or 5 billion Cong.
Target height 210000
At 15:24:38, November 28, 2012, Greenwich mean time, 210000 blocks were generated. In "stage 2" from this block, the number of new bitcoins contained in each block was halved to 25, the first time in history. For every 210000 blocks generated in the future, the number of bitcoins will be halved in turn. Until the 33rd half reduction, each block produced 0.0021 new bitcoin directly reduced to 0.
Once every four years
Halving every four years is not very strict. Reality: bitcoin generates about one block every 10 minutes, while 210000 10 minutes are close to four years. Analysis: we found that from 2009 to 2011, when bitcoin was born, bitcoin had a very low demand for mining equipment. You can even dig with a smart phone, and the revenue is not bad. Maybe an engineer is on the night shift and is bored to start the software. After sleeping, he can dig hundreds of thousands of bitcoins, but the bitcoin is not worth a dime. As time goes on, the difficulty of bitcoin mining is directly proportional to the amount of money that has been mined out. The more difficult it is to mine in the future, by 2030, when 20 million bitcoins are mined out, the remaining 1 million bitcoins will probably take decades to be mined out. According to the original design, bitcoin will eventually reach the limit of 21 million in 2140. This mechanism determines that the more people it produces in the future, the more difficult it will be to produce, and the cost of production difficulties will increase sharply, which will promote the market price (production is also carried out according to the procedures, known as gold mining). This is the investment attribute of money. Later, unless bitcoin is worth more than mining, I guess more and more people will retire from mining._DJMINER
Value added logic: what is the value-added logic of bitcoin?
In the white paper, the incentive mechanism is described as follows: the first transaction of each block is specialized, and the transaction generates a new electronic currency owned by the block creator. In this way, the incentive of nodes supporting the network is increased, and a method to distribute electronic money to the circulation field is provided when there is no central authority to issue money. This method of continuously adding a certain amount of new money to the monetary system is very similar to using resources to mine gold and inject gold into the circulation field. At this time, CPU time and power consumption are the consumed resources Another source of incentive is transaction fee
Fees). If the output value of a transaction is less than the input value, the difference is the transaction fee, which will be added to the block's incentive. As long as a certain amount of electronic money has entered the circulation, the incentive mechanism can be gradually converted to rely on transaction costs, so the monetary system can be free from inflation.
Analysis: the total number of 21 million is capped, bitcoin is generated by mining through internal circulation, and transaction scenarios are provided for bitcoin through external circulation. If there are a large number of bitcoin holders, a deflation model will be formed to drive the stable value-added of bitcoin.
1. Public chain sends token. A total of 21 million tokens are issued based on its own public chain. Typical decentralized applications form a trust mechanism;
2. Inner circulation mining. Bitcoin belongs to the typical digital currency, which belongs to the account book of distributed bookkeeping. Bitcoin has no direct use scenario. The mining method is through calculation, and the maximum cost of mining is electricity fee;
3. External circulation. After bitcoin transaction through the exchange, the circulation of the external circulation is completed, which brings circulation value to the internal circulation miners. If the circulation price is higher than the mining cost, it brings investment income to the miners;
4. Internal and external integration. After the completion of bitcoin mining in 2040, bitcoin is mainly obtained through exchange trading;
Bitcoin is a kind of "decentralized" electronic currency, which theoretically ensures that no one, institution or government can control the total amount of bitcoin or create inflation. All of the above, bitcoin, which is the number one digital currency, has a certain market because of its scarcity and supply is less than demand.
On May 21, 2010, the story of an American programmer buying pizza with 10000 bitcoin spread widely. At that time, the transaction price of a bitcoin was less than 1 cent. This is the first time bitcoin has been used as a payment tool in the real world. At today's price, 10000 bitcoin is enough to buy a luxury estate, which is also known as "the most expensive pizza in history". Over the next few years, more and more bitcoin enthusiasts began to try to buy various products with bitcoin. By 2017, bitcoin had set a record high price, with a maximum value of about $20000. According to data from the coindesk digital currency trading platform, the price of bitcoin once fell below $6000 in 18 years, 70% lower than the highest value of $20000 in 2017 The price of bitcoin at its peak is too inflated, so it is inevitable that it will fall. Its current price is basically around $6000, but in the long run, the future of digital currency is worth looking forward to._DJMINER
Circulation: how many exchanges are online at present.
Analysis: there is no doubt that bitcoin ranks first in the circulation market value. The higher the market price ratio, the more stable the position of bitcoin in the blockchain market, and the greater the weight of technology and team. The turnover rate is the first, which reflects that the demand for currency in the mass market is higher than other tokens. And there are 200 exchanges on the market, so as long as there are exchanges, there will be bitcoin. Of course, now the overall digital currency is in a bear market, at least holding the first bitcoin, the security is much higher.
Community interpretation: number and activity of users in the community.
As long as you know that the blockchain knows the digital currency, you can't escape bitcoin. No matter what the market price is, bitcoin is also the first one to be talked about by the market media, so its number of users and activity are basically clear at a glance.
Interpretation summary:
Bitcoin can be regarded as a masterpiece of cryptography. The verification principle of bitcoin's working mechanism is quite complex, which is still incomprehensible to most people, and various debates about bitcoin have been ongoing. However, in any case, as a epoch-making product, especially its underlying technology blockchain (blockchain is a new application mode of computer technology such as distributed data storage, point-to-point transmission, consensus mechanism, encryption algorithm), is now a major direction of active layout of numerous countries and enterprises. More and more cryptocurrencies have been and continue to be produced by the gene of "bitcoin", forming a "cluster" of cryptocurrencies, and traditional wealth began to transform into digital wealth. The future is in our own hands. We hope that while we continue to pay attention to bitcoin, we can think independently about its overall impact on the economy and society and make our own independent judgment._DJMINER
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