2010-07-19

Bitcoin P2P Currency

Open source innovation: Bitcoin

Alternative currencies for e-commerce have been attempted many times, but never one quite like Bitcoin. Its creator, Satoshi Nakamoto, has dubbed it a "cryptocurrency," because it relies on public/private key cryptography to facilitate electronic trading in a completely anonymous, secure, peer-to-peer fashion.



Bitcoin P2P Cryptocurrency

Bitcoin is a peer-to-peer network based digital currency. Peer-to-peer (P2P) means that there is no central authority to issue new money or keep track of transactions. Instead, these tasks are managed collectively by the nodes of the network. Advantages:
  • Transfer money easily through the Internet, without having to trust middlemen.
  • Third parties can’t prevent or control your transactions.
  • Bitcoin transactions are practically free, whereas credit cards and online payment systems typically cost 1-5% per transaction plus various other merchant fees up to hundreds of dollars.
  • Be safe from the instability caused by fractional reserve banking and bad policies of central banks. The limited inflation of the Bitcoin system’s money supply is distributed evenly (by CPU power) throughout the network, not monopolized by the banks.
Bitcoin is an open source project created by Satoshi Nakamoto, and is currently in beta development stage. Bitcoin development is hosted at SourceForge.

Anonymous internet banking

Anonymous Internet Banking is the name given to the proposed use of strong financial cryptography to make electronic bank secrecy (or more precisely pseudonymous banking) possible. The bank issues currency in the form of electronic tokens that can be converted on presentation to the bank to some other currency. This concept has a long history in which free banking institutions have issued their own paper currency often backed by a physical commodity.
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Examples of anonymous internet banking services that have already been implemented include:
  • Bitcoin: open source peer-to-peer electronic cash system that's completely decentralized, with no central server or trusted parties.
  • eCache: an anonymous bank operating over the Tor network.
  • Pecunix: an (optionally?) anonymous digital gold currency.
  • Yodelbank: an anonymous bank built on top of various digital gold currencies which ended operations during November 2005.

Peer-to-peer

A peer-to-peer, commonly abbreviated to P2P, is any distributed network architecture composed of participants that make a portion of their resources (such as processing power, disk storage or network bandwidth) directly available to other network participants, without the need for central coordination instances (such as servers or stable hosts).[1] Peers are both suppliers and consumers of resources, in contrast to the traditional client–server model where only servers supply, and clients consume.

Sources
Open source innovation on the cutting edge | Open Source - InfoWorld
http://www.infoworld.com/d/open-source/open-source-innovation-the-cutting-edge-582?page=0,2
Bitcoin P2P Cryptocurrency | Bitcoin
http://www.bitcoin.org/
Anonymous internet banking - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Anonymous_internet_banking
Peer-to-peer - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Peer-to-peer

Related
Bitcoin - Wikipedia, the free encyclopedia
http://en.wikipedia.org/wiki/Bitcoin
Bitcoin | Download Bitcoin software for free at SourceForge.net
http://sourceforge.net/projects/bitcoin/
Bitcoin P2P Cryptocurrency | Bitcoin | Latest Security News | GSO - Network Security Resources
http://www.governmentsecurity.org/latest-security-news/bitcoin-p2p-cryptocurrency-bitcoin.html
TransAlchemy: The Global Survival Market
http://www.transalchemy.com/2010/07/global-survival-market.html
P2P Foundation
http://blog.p2pfoundation.net/
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