• Skip to primary navigation
  • Skip to content
  • Skip to footer

Nakamoto Studies Institute

  • Satoshi Writings
    • Satoshi’s White Paper
    • Satoshi Nakamoto Emails
    • Satoshi Nakamoto Forum Writings
  • Literature
    • Daniel Krawisz Archive
  • About NSI
  • Newsletter
  • Support
You are here: Home / Forums / Bitcoin open source implementation of P2P currency

Bitcoin open source implementation of P2P currency

February 18, 2009 by bitcoincash

Original Post

It is a global distributed database, with additions to the database by consent of the majority, based on a set of rules they follow:

– Whenever someone finds proof-of-work to generate a block, they get some new coins
– The proof-of-work difficulty is adjusted every two weeks to target an average of 6 blocks per hour (for the whole network)
– The coins given per block is cut in half every 4 years

You could say coins are issued by the majority. They are issued in a limited, predetermined amount.

As an example, if there are 1000 nodes, and 6 get coins each hour, it would likely take a week before you get anything.

To Sepp’s question, indeed there is nobody to act as central bank or federal reserve to adjust the money supply as the population of users grows. That would have required a trusted party to determine the value, because I don’t know a way for software to know the real world value of things. If there was some clever way, or if we wanted to trust someone to actively manage the money supply to peg it to something, the rules could have been programmed for that.

In this sense, it’s more typical of a precious metal. Instead of the supply changing to keep the value the same, the supply is predetermined and the value changes. As the number of users grows, the value per coin increases. It has the potential for a positive feedback loop; as users increase, the value goes up, which could attract more users to take advantage of the increasing value.

Notable Selections:

…it’s more typical of a precious metal. Instead of the supply changing to keep the value the same, the supply is predetermined and the value changes. As the number of users grows, the value per coin increases.

Filed Under: Forums Tagged With: p2p foundation, precious metal

Support NSI with Bitcoin Cash

Did you like this piece? Please consider dropping a tip to support our ongoing efforts to archive the work of Satoshi Nakamoto. Small tips are only made possible with Bitcoin Cash!

Footer

Categories

  • Code
  • Emails
  • Forums
  • Literature
  • Uncategorized

Keywords

adam back anonymous b-money bitcoin.org Bitcoin: A Peer-to-Peer Electronic Cash System bitcointalk bug commerce double spend dustin d. trammel gavin andresen generate coins gnutella gpu hal finney hashcash hash cash inflation james a. donald liberty standard linux micropayment mike hearn moore's law napster nicholas bohm node non-reversible transaction p2p foundation proof-of-work ray dillinger satoshi nakamoto scaling Simplified Payment Verification sirius-m the crypto anarchist manifesto" the cryptography mailing list timothy c. may tor transaction fee v0.1.6 visa wei dai white paper [bitcoin-list]

Support NSI with Bitcoin Cash

Copyright © 2020 · Genesis Sample on Genesis Framework ·