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+---
+layout: default
+title: 'Bitcoin open source implementation of P2P currency'
+date: 2009-02-11 23:30:54 CET
+grand_parent: Emails
+parent: '[p2p-research'
+nav_order: 1
+---
+
+# Re: Bitcoin open source implementation of P2P currency
+
+The email on the Cryptography Mailing List that announced Bitcoin publicly to the world.
+{: .fs-6 .fw-300 } 
+
+---
+
+```
+I've developed a new open source P2P e-cash system called Bitcoin.  It's 
+completely decentralized, with no central server or trusted parties, 
+because everything is based on crypto proof instead of trust.  Give it a 
+try, or take a look at the screenshots and design paper:
+
+Download Bitcoin v0.1 at http://www.bitcoin.org
+
+The root problem with conventional currency is all the trust that's 
+required to make it work.  The central bank must be trusted not to 
+debase the currency, but the history of fiat currencies is full of 
+breaches of that trust.  Banks must be trusted to hold our money and 
+transfer it electronically, but they lend it out in waves of credit 
+bubbles with barely a fraction in reserve.  We have to trust them with 
+our privacy, trust them not to let identity thieves drain our accounts. 
+  Their massive overhead costs make micropayments impossible.
+
+A generation ago, multi-user time-sharing computer systems had a similar 
+problem.  Before strong encryption, users had to rely on password 
+protection to secure their files, placing trust in the system 
+administrator to keep their information private.  Privacy could always 
+be overridden by the admin based on his judgment call weighing the 
+principle of privacy against other concerns, or at the behest of his 
+superiors.  Then strong encryption became available to the masses, and 
+trust was no longer required.  Data could be secured in a way that was 
+physically impossible for others to access, no matter for what reason, 
+no matter how good the excuse, no matter what.
+
+It's time we had the same thing for money.  With e-currency based on 
+cryptographic proof, without the need to trust a third party middleman, 
+money can be secure and transactions effortless.
+
+One of the fundamental building blocks for such a system is digital 
+signatures.  A digital coin contains the public key of its owner.  To 
+transfer it, the owner signs the coin together with the public key of 
+the next owner.  Anyone can check the signatures to verify the chain of 
+ownership.  It works well to secure ownership, but leaves one big 
+problem unsolved: double-spending.  Any owner could try to re-spend an 
+already spent coin by signing it again to another owner.  The usual 
+solution is for a trusted company with a central database to check for 
+double-spending, but that just gets back to the trust model.  In its 
+central position, the company can override the users, and the fees 
+needed to support the company make micropayments impractical.
+
+Bitcoin's solution is to use a peer-to-peer network to check for 
+double-spending.  In a nutshell, the network works like a distributed 
+timestamp server, stamping the first transaction to spend a coin.  It 
+takes advantage of the nature of information being easy to spread but 
+hard to stifle.  For details on how it works, see the design paper at 
+http://www.bitcoin.org/bitcoin.pdf
+
+The result is a distributed system with no single point of failure. 
+Users hold the crypto keys to their own money and transact directly with 
+each other, with the help of the P2P network to check for double-spending.
+
+Satoshi Nakamoto
+http://www.bitcoin.org
+```