Bitcoin, the first-ever digital money that made effective use of blockchain technology, which prompted the creation of an entirely new industry, has been misinterpreted and misused over the years. With the rapid growth of the industry comes an urgent need to educate Bitcoin beginners, enthusiasts, and investors about what Bitcoin really is.
And this is what Bitcoin creator Satoshi Nakamoto, known in the real world as nChain Chief Scientist Dr. Craig S. Wright, and Engineering Head of tokenization entity smart wallet at The Bayesian Group and Money Button founder Ryan X. Charles are doing with their YouTube series, “Theory of Bitcoin.”
Veering away from regular programming, the duo embark on a series of episodes dissecting the Bitcoin white paper written by Dr. Wright in 2008, which serves as the foundation of the Bitcoin released in 2009 and now, Bitcoin SV (BSV), SV meaning Satoshi Vision. For their first episode on the Bitcoin white paper, Dr. Wright and Charles delve into the definition of “peer-to-peer” in the white paper title “Bitcoin: A Peer-to-Peer Electronic Cash System,” which is often misconstrued to mean users.
“Peer-to-peer, people get it wrong because they think “users,” I explained this later in the white paper and tried to point out that nodes and users—they’re not the same thing. In a computer science type way of putting it, users exchanging with users are not truly peer-to-peer. The miners, the nodes are peer-to-peer. The broadcast mechanism between nodes is peer-to-peer. But only miners and other related commercial entities become nodes,” Dr. Wright explains.
And true enough, especially for Bitcoin beginners who do not know the inner workings of the Bitcoin network, “peer-to-peer” is easily misunderstood as the way users send digital money to each other. In reality, though, the term points to the way nodes, mostly operated by miners, communicate with each other.
Furthermore, the first sentence of the abstract, “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution,” is often misunderstood to mean that Bitcoin is anti-banks or it aims to replace the banking system. This is not the case as financial institutions, such as banks, play an important role in the economy and cannot be replaced.
“Number one, it’s a cash system. And that doesn’t mean a money system that replaces banks or anything like that. It means cash, and that’s an incredibly important distinction…. Cash doesn’t replace anything. Cash doesn’t replace the world’s money…. Now, you can tokenize and build things on top of Bitcoin, but that is completely separate, that’s something else, that’s another layer on top of Bitcoin” Dr. Wright clarifies.
In fact, many firms and institutions from various industries, such as healthcare, government, gaming, and social media, are developing various platforms and applications on the Bitcoin SV blockchain. Where the Internet made it possible for everything to be online today, blockchain technology will enable a fully on-chain world in the near future.
Bitcoin beginners, users, and enthusiasts can watch more episodes of the Bitcoin white paper series on the Theory of Bitcoin YouTube channel.