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To talk about this, we have to start before Bitcoin.

If you're not familiar with Bitcoin, you can take a look at this first.

Bitcoin is completely virtual. It has no actual value and cannot create any value; it's just a virtual currency. Why do people go crazy sending money to buy Bitcoin? Let's dig a bit deeper: why does Bitcoin even exist?

Bitcoin was born against the backdrop of the 2008 financial crisis. The financial crisis spread globally, with no country immune. Fiat currencies became less reliable. Imagine the underlying relationship: governments issue legal tender backed by national credit. But the world is not always stable and peaceful, with wars, natural disasters and financial crises impacting society, which in turn affects the economy.

About wars: Society relies on governments, governments control armies, armies maintain society. Nations fund their armies through taxation. Conflicts between nations can arise if the benefits outweigh the costs, leading to war. Taxpayers fund the armies to launch wars. When the cannons boom, gold weighs a thousand taels. Some nations profit, some lose money.

About finance: Most countries in the world, like Europe and North America, have economic cycles. Small cycles make up large cycles, like a sine wave function. Periodic financial crises are like a sword hanging overhead; we can only pray: "Dharma, spare me!"

About natural disasters: They are difficult to predict. Though technological advances have reduced their impact on humans, threats remain for the next few decades. Viruses, floods, volcanoes - the economy suffers in response.

Since the economy will be impacted one way or another, can we find a type of money that is not devalued? It doesn't have to withstand all crises until mankind's destruction; it just needs to survive some natural disasters and human troubles. Money, I beg you, don't let a financial crisis on one end of the Earth affect people's normal lives on the other end.

There really is such a magical thing.

This kind of money originates from an "anarchist" idea. The previous b-money already reflects this idea.

The basic position of "anarchism" is to oppose all forms of domination and authority, including government, advocate self-help relations between individuals, and focus on individual freedom and equality. For anarchists, the word "anarchy" does not represent chaos, emptiness, or a state of moral degeneration, but a harmonious society established by the voluntary combination of free individuals to build mutual assistance, autonomy and anti-dictatorship, which is an autonomous system with authority but without government. They believe the root lies in "government", in the current pyramid structure from top to bottom. The layer-upon-layer management model not only has problems of inaction, corruption and waste, more importantly, there is always an organization above managing and maintaining order, which can easily lead to turmoil due to major conflicts of interest.

• Further analysis, you see that primitive society was very peaceful. People lived together spontaneously in large families, hunted together and cooperated. There was no so-called government or nation, only small-scale wealth accumulation and division of labor, and no laws or police. Because primitive society had no private property, everyone was a piece of meat that could run and jump, naked.
• Later, with private property came violence. The reason is simple, because you can profit from it .Through violent plunder of wealth, there will be "brave men" who do it for profit.
• Then, when there are a large number of "profitable" organizations, someone will stand up to protect everyone. The emergence of violent organizations to prevent violence - the army. Everyone pays a little money (taxes) in exchange for protection. People form governments to provide protection services more efficiently. People deposit their money in banks because banks can provide protection: vaults, safe deposit boxes, security guards, police, etc. This system relies on the government to operate, banks, police, either accept government regulation or are established by the government. My money is not on me, it's in the bank, haha you can't rob it.
• In this way, two large organizations (governments) will engage in larger-scale wars due to collective interest conflicts if the benefits outweigh the costs of launching the war. Recruit more armies to protect collective property...The violent conflicts become larger and larger, where is the peace? Nuclear deterrence.

By the 21st century, people's property, including social and entertainment, gradually shifted to the Internet. So the organizations that protect people's property also migrated online: online banks, Alipay.

No problem, leave your money with us, haha. Just pay a small fee, haha. It's the protection organization that helps everyone keep it, if you lose money, solve it with the platform! Wars have also become online attacks and defenses, protection organizations and hackers fight back and forth, desperately holding on to everyone's money.

In the past, protection organizations only provided physical protection and would not station troops in your home to guard you. But it's different online, all your data is uploaded to the server in one go. My data is also my asset! The data contains privacy, property, what you bought today, who you like to chat with, what you like to watch, what you want to eat at night ... All can be analyzed from the data. This is equivalent to a "network army" stationed in your home, monitoring your every move day and night. And how the data is processed is up to them. Because the protection organization controls the server, if they think it's not good, disadvantageous to someone, they can directly delete it without your consent.

Is it possible to flatten the "pyramid" and build a system of "personal sovereignty" for each person to represent equal and independent individuals, not dependent on protection organizations?

It is possible. There is a way for you to safely hold your own private property by yourself. You don't need a bank to protect your wealth, don't need a safe to protect, and don't need protection organizations, you can keep it by yourself.

But how can you protect your property yourself? The answer is to use modern cryptography through mathematics!

Bombs can blow open safes, but they cannot blow open cryptography!

Bitcoin is just that kind of money! You generate your own private key, as long as the private key is not leaked, no one can take your bitcoins from you. Receiving and sending bitcoins are peer-to-peer transfers that bypass third-party centralized platforms (banks). Of course, if you lose the private key, you'll never be able to find your bitcoins again.

Your private key, mastering your own data, not dependent on third parties, perfect.

Of course, encrypted currency was not Satoshi Nakamoto's own idea.

David (Wei Dai) mentioned Tim May, who was one of the three people who jointly initiated the Cypherpunk research group in California Bay Area in 1992 along with Eric Hughes and John Gilmore. At the first meeting, the word "cypherpunk" was born by combining the roots of "cipher" and "cyberpunk."

They found in cryptography and algorithms a potential solution to the excessive centralization of the Internet. Cryptographers believed that to reduce the power of governments and companies, new technologies, better computers and more cryptographic mechanisms were needed. However, their plans faced an insurmountable obstacle: ultimately, all of their projects needed financial support, and governments and banks controlled that money. If they wanted to realize their plans, they needed a form of currency not controlled by the government. So the race for encrypted currency began. But the result was the exact opposite. All the initial efforts failed, including the legendary cryptographer David Chaum's ECash, as well as various encrypted currencies like Hashcash and Bit Gold.

Wei Dai is a Chinese American computer engineer and an alumnus of the University of Washington. In the late 1990s and early 2000s, he worked in the cryptography research group at Microsoft. During his time at Microsoft, he was involved in researching, designing and implementing cryptographic systems. Previously, he was a programmer at TerraSciences in Massachusetts.

In 1998, he published an informal white paper called "B-money, an anonymous distributed electronic cash system" on his personal website weidai.com. He is known for his contributions to cryptography and cryptocurrencies. He developed the Crypto++ cryptographic library, created the B-Money cryptocurrency system, and co-proposed the VMAC message authentication code algorithm. Wei Dai's pioneering work in the blockchain and digital currency field laid the foundation for later Bitcoin technology and was of milestone significance.

In November 1998, just after graduating from university, he proposed the idea of B-money in the community: "Effective cooperation requires an exchange medium (money) and a way to enforce contracts. In this paper, I describe a protocol whereby untraceable anonymous entities can cooperate more efficiently... I hope this protocol can help move encrypted anarchism forward, both theoretically and practically. " The design goal of B-money was an anonymous, distributed electronic cash system.

In the eyes of the Cyberpunks community, the problem with this approach was that the government could control the flow of money through policy management, and using these institutional services (banks or Alipay) required exposing one's identity. So Dai provided two alternative solutions (proof of work and distributed bookkeeping).

1. Proof of work creates money. Anyone can calculate some mathematical problems, and the person who finds the answer can broadcast it to the entire network. After each network node verifies it, they will add or destroy work equivalent value encrypted currency in the account of this person in their own account book.
2. Distributed bookkeeping tracks transactions. Neither the sender nor the receiver has a real name, only public keys. The sender signs with the private key and then broadcasts the transaction to the entire network. Each new transaction generates, everyone updates the account book in their hands, so that no one can stop the transaction and ensure the privacy and security of all users.
3. Transactions are executed through contracts. In B-money, transactions are achieved through contracts. Each contract requires the participation of an arbitrator (third party). Dai designed a complex reward and punishment mechanism to prevent cheating.

We can see the connection with Bitcoin. Money is created through POW proof of work, and the account book work is distributed to a peer-to-peer network. All transactions must be executed through contracts. However, Dai believed that his first version of the solution could not be truly applied in practice, "because it requires a very large real-time tamper-resistant anonymous broadcast channel." In other words, the first solution could not solve the double spending problem, while Bitcoin solved the Byzantine Generals problem through incentives.

Dai later explained in the Cyberpunks community: "B-money is not yet a complete viable solution. I think B-money can at most provide an alternative solution for those who do not want or cannot use government-issued currencies or contract enforcement mechanisms." Many of the problems of B-money have remained unresolved, or at least have not been pointed out. Perhaps most importantly, its consensus model is not very robust. After proposing B-money, Dai did not continue to try to solve these problems. He went to work for TerraSciences and Microsoft.

But his proposal was not forgotten. The first reference in the Bitcoin white paper was B-money. Shortly before the publication of the Bitcoin white paper, Adam Back of Hashcash suggested that Satoshi Nakamoto read B-money. Dai was one of the few people Satoshi Nakamoto contacted personally. However, Dai did not reply to Satoshi Nakamoto's email, and later regretted it.

He wrote on LessWrong, "This may have been partly my fault, because when Satoshi emailed me asking for comments on his draft paper, I didn't reply. Otherwise I might have been able to successfully persuade him not to use a fixed money supply."

B-money was another exploration by the cypherpunk community to develop an independent currency in the digital world. In his memory, two cryptocurrencies were named "Dai" and "Wei" respectively, of which Wei was named by Vitalik in 2013 as the smallest unit of Ethereum.

However, with each new attempt and each new failure, the "cypherpunks" gained a better understanding of the difficulties they faced. Therefore, with many previous attempts to explore, Satoshi Nakamoto learned from the problems encountered by his predecessors and launched Bitcoin on October 31, 2008.

As Satoshi Nakamoto said in his first email on this issue, "I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party." He believed that his core contribution was: creating a virtual currency managed and maintained by users; governments and businesses have almost no say in how the currency operates; it will be a completely decentralized system run by users.

Satoshi Nakamoto was well aware of the inglorious history of cryptocurrencies. In an article shortly after the release of Bitcoin in February 2009, Satoshi Nakamoto mentioned Chaum's work but distinguished Bitcoin from Chaum's work. Many people mistakenly regarded electronic money as a failed venture because all companies had failed since the 1990s. In my view, the failure of those digital currencies was because their systems were not decentralized. I believe Bitcoin is our first attempt to build a decentralized, trustless virtual currency system.

To ensure trust between participants, Satoshi Nakamoto designed a public chain that allows people to enter and check to ensure their money still exists. To protect privacy, Bitcoin uses an encrypted private key system that allows users to tell others their account without revealing their identity. To incentivize users to maintain the system, Bitcoin introduced the concept of mining, in which users can create new transaction blocks and earn rewards with newly minted bitcoins. To prevent hacking, blocks are cryptographically linked to previous blocks, making the transaction history essentially immutable. Bitcoin's real innovation is that its monetary system is completely decentralized, that is, there is no ultimate decision maker or authority to resolve disputes or determine the direction of currency development, but users collectively determine Bitcoin's future as a whole.

Cypherpunks remain vigilant about these threats. They are trying to weaken the government's and companies' surveillance capabilities by creating a set of privacy-enhancing programs and methods, including strong cryptography, secure email, and cryptocurrencies. Their ultimate goal is to decentralize decision making on the Internet. Cypherpunks do not concentrate power in the hands of a few but seek to distribute power to the masses so that everyone can decide together how the entire system should operate.

In the eyes of cypherpunks, the main problem of the Internet age is that governments and companies have become too powerful, posing a serious threat to individual privacy. In addition, the US government and companies abuse their power and status, charging consumers too much and imposing heavy taxes. The answer lies in decentralizing power—distributing power and decision making from a few to many. But before Bitcoin appeared, it was unclear how to achieve this, and Satoshi Nakamoto provided the solution.

Is Bitcoin absolutely safe? Of course not. If you want to rob someone's Bitcoin, put a knife to his throat and ask him to hand over the private key. Whoever has the private key owns the Bitcoin. The encryption algorithm only recognizes the private key. This is the charm of decentralization. We believe in Bitcoin not because Satoshi Nakamoto will not sell his huge amount of Bitcoin, but because we believe in individual sovereignty and cryptography.

People will say that when Satoshi Nakamoto invented Bitcoin, he could not foresee the astonishing consequences at all. Of course, to some extent, it was indeed impossible for him to foresee "Bitcoin pizza", "Silk Road", Mt.Gox or the crazy bull market in 2017.

However, Satoshi Nakamoto had an amazing vision for the development of this technology. For example, he wrote that although blockchain technology cannot solve privacy issues on the Internet, if successful, users will "win a major battle in an arms race and gain new freedom over the next few years." He also foresaw that blockchain technology would be difficult to shut down. As he wrote, "Governments are good at cutting off the heads of centrally controlled networks like Napster, but pure peer-to-peer networks like Gnutella and Tor seem to be holding their own." He also saw that the blockchain itself is a flexible technology that can be developed into endless applications by users. "Once it gets going, there are going to be applications nobody ever dreamed possible, no sooner than you can install a plug-in on a website for pennies if you wanted too, it will be that easy."

At the same time, Satoshi Nakamoto was also worried about the consequences he brought to the world. He worried about how governments would deal with his virtual currency. When blockchain users pushed WikiLeaks to use Bitcoin to avoid government sanctions, Satoshi Nakamoto strongly opposed it, saying: "You would likely do more harm than good at this point." He was also worried about the emergence of super miners. He wrote: "We should have an gentleman's agreement to postpone the GPU arms race as long as we can for the good of the network." His biggest concern may have been network security. After detailing improvements to virtual currencies, he summarized in his last public message: "There are still more ways to attack than I can calculate."

The mystery surrounding Satoshi Nakamoto will only increase people's curiosity about him and his technology. Although journalists have tried their best to uncover his mysterious veil, we may never know who he is. Satoshi Nakamoto is like a star shining in the middle of the night, always twinkling in our sight but unattainable. This is very punk and poetic. The inventor of Bitcoin refuses to become the centre of his invention. Blockchain technology is a technology that removes trusted intermediaries from our lives and empowers everyone. He refused to become the focus of people's attention. The success or failure of the blockchain must depend on its own advantages - relying on the characteristics of the technology itself and the efforts of users to make it work.

Satoshi Nakamoto's idea may be quite innovative, but the rise of Bitcoin was not inevitable. Bitcoin was born against the backdrop of the 2008 financial crisis. The financial crisis swept the globe, and no country could stand alone. Fiat currencies became unreliable. Satoshi Nakamoto and his supporters often pleaded over and over again to convince others to believe in Bitcoin. They often said one sentence: Imagine if Bitcoin became the world's currency. Imagine how much each Bitcoin would be worth then! And all you have to do is download the software and run it on your home computer to earn hundreds of them. Of course, most people believed that this was a pyramid scam under Satoshi Nakamoto's tireless efforts.

But it did not prevent some tech geeks from becoming interested in Bitcoin eventually. Satoshi Nakamoto's efforts paid off, and people began to use and accept Bitcoin in the real world. Then on May 22, 2010, programmer Laszlo Hanyecz bought 2 boxes of pizza for 10,000 bitcoins.

Then, fundamental changes began to happen in the entire Internet world: once people started using Bitcoin in the real world, an ecosystem surrounding Bitcoin emerged. Cryptocurrency exchanges like Mt.Gox, Binance, and Coinbase were born to make it easier for people to buy and sell this currency. To solve the difficult mathematical problems behind the currency, professional miners began to build mines around the world. Chip manufacturers began to produce dedicated chips.

People's growing interest in Bitcoin stimulated the development of the Bitcoin and cryptocurrency market. The value of Bitcoin began to soar wildly. In 2010, Bitcoin was less than 1 cent. By mid-2021, it rose to $60,000. This crazy surge led many outsiders to compare it with historical bubbles such as the Tulip Mania in the 17th century and the South Sea Bubble in the 18th century. Concerns about the collapse of Bitcoin prices began to spread. Secondly, the emergence of competitive cryptocurrencies.

Seeing the success of Bitcoin, some entrepreneurial-minded computer scientists have launched cryptocurrencies based on blockchain technology. For example, Litecoin, Dogecoin, and Ethereum. Ethereum built a new type of computer on top of Bitcoin that runs on decentralized virtual machines around the world. It cannot be tampered with, shut down by governments, or controlled by governments. People of different races, living in different regions and with different lifestyles from all over the world come together to form a decentralized network. Unless the United Nations shuts down the Internet on Earth, as long as the Internet is up, this decentralized organization will continue to exist.

In 2017, initial coin offerings (ICOs), where individuals or groups raise funds by selling cryptocurrencies or "tokens", became popular very quickly. However, most of them ended in failure. About half of the initial coin offerings went bankrupt within a year despite widespread media attention on virtual currencies.

However, the network speed of almost all electronic devices is too slow. Think about it, in the early days, any ordinary computer could join the Bitcoin network to mine, but now with more and more people mining Bitcoin and the increasing difficulty of hash, people have to buy more high-performance graphics cards and combine more computers to mine. This is equivalent to a decentralized server room.

Dominic thought, why not let data centre server rooms act as nodes, which can also improve performance!

As a result, IC has become "server room chain", a decentralized network composed of server rooms around the world. Ethereum is better at financial dapps, while IC is good at general dapps. This has led to a "personal sovereignty" revolution in various Internet applications: envisioning the future of blockchain.