Central Africa Embraces Bitcoin and Cryptocurrency Adoption for Economic and Political Stability
Bitcoin, the world’s first decentralized digital currency, has seen growing adoption in Central Africa in recent years. This trend is driven by a number of factors, including the region’s high inflation rates, political instability, and lack of access to traditional banking services.
One of the main reasons for the adoption of Bitcoin in Central Africa is the high inflation rates that many countries in the region face. Inflation erodes the purchasing power of a currency, making it difficult for people to save and plan for the future. By using Bitcoin, which is not subject to inflation, individuals and businesses in Central Africa can protect their wealth and preserve its value over time.
Political instability is another factor driving the adoption of Bitcoin in Central Africa. Many countries in the region have a history of coups, civil wars, and political unrest, which can lead to the confiscation of assets and bank accounts. By using Bitcoin, which is decentralized and not controlled by any government or institution, individuals and businesses in Central Africa can protect their assets from seizure and avoid the risks associated with political instability.
In addition to high inflation and political instability, many people in Central Africa lack access to traditional banking services. In some rural areas, there are no banks or financial institutions, making it difficult for individuals and businesses to access credit, save money, and make payments. By using Bitcoin, which can be easily accessed and used with a smartphone and internet connection, people in Central Africa can enjoy many of the same benefits of traditional banking without the need for physical infrastructure.
The adoption of Bitcoin in Central Africa is also supported by a growing ecosystem of businesses and services that accept the cryptocurrency. This includes merchants who accept Bitcoin for goods and services, as well as exchanges and wallet providers that facilitate the buying and selling of Bitcoin. This ecosystem is helping to drive the adoption of Bitcoin and is making it easier for people in Central Africa to use the cryptocurrency in their daily lives.
In addition to the factors mentioned above, there are several other reasons why Bitcoin is gaining popularity in Central Africa. The increasing use of mobile phones and internet access in the region has made it easier for people to use Bitcoin and other digital currencies. The growing awareness of the benefits of Bitcoin, such as its decentralized nature, low transaction fees, and fast transaction times, has also contributed to its increasing popularity in the region. The growing adoption of Bitcoin in other parts of the world has also played a role in its acceptance in Central Africa.
Furthermore, the Central African Republic has recently unveiled its own cryptocurrency, Sango Coin, which will be the second cryptocurrency, after Bitcoin, to be recognized as legal tender in the country. The President of the Central African Republic has voiced support for blockchain, cryptocurrencies, and Bitcoin, further demonstrating the increasing interest and involvement in the cryptocurrency space in the region.
Overall, the adoption of Bitcoin in Central Africa is driven by a combination of economic, political, and technological factors. As the ecosystem of businesses and services that accept Bitcoin continues to grow, it is likely that the adoption of the cryptocurrency will continue to increase in Central Africa.
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The Role of Bitcoin in Building a Decentralized Financial System
Bitcoin, the world’s first and most widely-used decentralized digital currency, has an important role in building a decentralized financial system. One of the key advantages of Bitcoin is its potential for appreciating in value, thanks to its limited and predetermined supply. This can make it a potentially attractive investment, as it may increase in value over time.
In addition to its potential for growth, Bitcoin offers security and transparency through its distributed ledger, the blockchain. This means that transactions on the network are almost impossible to cheat or make fraudulent, making it a secure option for conducting financial transactions.
Bitcoin’s decentralized nature also means that it is not subject to the same risks as traditional currencies, such as inflation or government seizure. This makes it a useful option for individuals in countries with unstable currencies or high inflation rates, as it allows them to store value and make payments in a more stable and secure way.
The rise of DeFi, or decentralized finance, has also seen the development of a number of projects built on top of the Bitcoin network. These include RSK and tBTC, which allow users to access a wide range of financial services in a decentralized and trustless manner.
The Lightning Network, another layer built on top of the Bitcoin network, also offers users the ability to make fast and cheap transactions. This can make transactions faster and cheaper, and can also enable new use cases such as micropayments and instant payments. One such wallet that integrates with the Lightning Network is HolyTransaction, which offers a wide range of digital assets and other benefits such as an easy-to-use interface and fast and cheap transactions.
A leading project is Blockstream’s Liquid Bitcoin, also known as L-BTC. Liquid Bitcoin is a sidechain-based token that is pegged to the value of Bitcoin, allowing users to transfer value between the two networks quickly and securely. The Liquid Network is a federated sidechain that uses a consortium of trusted nodes to provide increased privacy and security for users.
Another project that leverages the Liquid Network is Fuji Money, a Lightning-enabled non-custodial synthetic asset protocol. Fuji Money allows users to create and trade synthetic assets, such as stablecoins or synthetic commodities, on the Liquid Network in a trustless and decentralized manner. This allows users to access a wider range of financial instruments and services, further expanding the capabilities of the decentralized financial system.
Overall, the role of Bitcoin in building a decentralized financial system is significant, thanks to its potential for appreciation in value, security and transparency, and ability to provide financial inclusion.
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How bitcoin can help you take control of your financial future
Bitcoin is a decentralized digital currency that has gained popularity in recent years for conducting online transactions. HolyTransaction is proud to offer our users the benefits of using this innovative digital currency, including security, low transaction fees, and greater control over one’s own cryptocurrencies.
One of the key advantages of using Bitcoin for online transactions is its decentralized nature. This makes it a secure option for conducting transactions and protects against the potential for a single point of failure. In addition, each transaction is verified by the network of computers that run the Bitcoin software, making it virtually impossible to forge or counterfeit.
Another benefit of using Bitcoin is its low transaction fees. Because there are no intermediaries such as banks or credit card companies involved in the process, transaction fees are typically much lower than they would be with traditional forms of payment. This can be especially beneficial for those who conduct a large number of transactions, such as small business owners or online merchants.
In addition to these benefits, using Bitcoin can also offer users more control over their own money. Because it is decentralized and not controlled by any one entity, users are free to store, send, and receive Bitcoin without interference from third parties. This can be especially valuable in countries where access to traditional financial services is limited.
Another potential benefit of using Bitcoin is its potential for growth. Because there is a limited supply of Bitcoins, and the demand for them is increasing, the value of the currency has the potential to increase over time. This makes it a potentially attractive investment option for those looking to grow their wealth.
Of course, there are also risks associated with using Bitcoin. The value of the currency can be volatile, and there have been instances of large-scale attacks on Bitcoin exchanges. However, these risks can be mitigated by taking steps to protect your Bitcoin wallet.
At HolyTransaction, we are committed to providing our users with a reliable platform for buying and selling Bitcoin. With a user-friendly interface and low fees, HolyTransaction is the perfect place to start your journey with Bitcoin and take control of your financial future.
In addition to our exchange services, we also offer a range of other tools and resources to help our users make the most of their Bitcoin experience. Our educational materials and support team can provide guidance and assistance for beginners, while our user-friendly trading options are ideal for those just starting out with Bitcoin.
We are constantly working to improve and expand our services to meet the needs of our users. This includes the addition of new cryptocurrencies and features, as well as ongoing efforts to enhance security and user experience.
At HolyTransaction, our goal is to make Bitcoin accessible and easy to use for everyone. Whether you are a beginner looking to get started with Bitcoin or just want an easy and secure way to buy and sell the digital currency, we have something for you. Join us on our mission to help you take
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The Benefits of Using Bitcoin for Online Transactions
Bitcoin is a decentralized digital currency that has gained popularity in recent years for conducting online transactions. Unlike traditional currencies that are controlled by central banks, Bitcoin is not subject to the whims of any one entity, making it an attractive option for those looking to conduct transactions online.
One of the key benefits of using Bitcoin for online transactions is its security. Because it is decentralized, there is no central point of failure that attackers can target. In addition, each transaction is verified by the network of computers that run the Bitcoin software, making it virtually impossible to forge or counterfeit.
Another benefit of using Bitcoin for online transactions is its low transaction fees. Because there are no intermediaries such as banks or credit card companies involved in the process, transaction fees are typically much lower than they would be with traditional forms of payment. This can be especially beneficial for those who conduct a large number of transactions, such as small business owners or online merchants.
In addition to these benefits, using Bitcoin for online transactions can also offer users more control over their own money. Because it is decentralized and not controlled by any one entity, users are free to store, send, and receive Bitcoin without third parties.
Some other potential benefits of using Bitcoin for online transactions include:
Faster transaction times: Because Bitcoin transactions are processed on a decentralized network, they can be completed much more quickly than traditional bank transfers or credit card payments. This can be especially useful for people who need to make or receive payments quickly, such as when making an emergency purchase or receiving payment for a time-sensitive project.
Immutability: This means that once a transaction is recorded on the Bitcoin blockchain, it cannot be altered or deleted. This provides a high level of security, as it ensures that transactions cannot be tampered with or reversed without the consensus of the network. This feature also helps to prevent fraud, as it makes it difficult for someone to modify or falsify records. Overall, the immutability of the Bitcoin blockchain provides a level of trust and security for users of the network.
Greater global accessibility: Because it is decentralized and not tied to any specific country or currency, Bitcoin can be used for online transactions anywhere in the world. This can be especially helpful for individuals and businesses in countries with unstable economies or limited access to traditional financial institutions.
Overall, the use of Bitcoin for online transactions offers a number of potential benefits, including security, low transaction fees, and greater control over one’s own currency. As more businesses and individuals begin to recognize the potential of this cryptocurrency, its use is likely to continue to grow. In fact, the use of Bitcoin is already starting to become more widespread, with many online merchants and small business owners choosing to accept it as a form of payment.
One final note about using Bitcoin for online transactions is its potential environmental benefits. Because it uses a decentralized network of computers to verify transactions, it does not require the same energy-intensive processes as traditional money transfer services. In fact, many of the computers that run the Bitcoin network are powered by renewable energy sources, which can help to reduce its carbon footprint. This is in contrast to traditional financial systems, which often rely on fossil fuels and other sources of pollution. In this way, using Bitcoin for online transactions can not only provide security and convenience, but also contribute to a cleaner and more sustainable world.
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El Salvador’s “Adopting Bitcoin” Conference as a Key Moment for the Bitcoin Industry
Emerging at the forefront of Bitcoin innovation, El Salvador is working toward achieving a level of financial independence and openness independent from a centralised banking system. El Salvador has paved the way for other nations to follow in its footsteps by becoming the first nation in the world to recognise Bitcoin as a legitimate currency.
To encourage worldwide collaboration and proliferate networking avenues for Bitcoin enthusiasts, El Salvador hosted the “Adopting Bitcoin” Conference over 3 days, between November 15 and 17. The event took place in San Salvador and at Bitcoin Beach and brought together members of the Bitcoin ecosystem from a multitude of states.
Uncovering the Objectives of the “Adopting Bitcoin” Conference
More than 110 speakers from over 30 countries discussed the most recent breakthroughs throughout the whole range of Bitcoin-related disciplines, including those pertaining to technology as well as economics.
In this setting, the presentation of the Bitcoin core engineer Jon Atack was a significant highlight, focused on technology and development, while the presentation of Mexican senator Indira Kempis will be the most famous name in the track focused on economics. The multi-stage event will be held in English, with Spanish translations provided in real-time for the most critical phases.
Bitfinex Pledges to Support El Salvador in Future Bitcoin Ventures
Paolo Ardoino, the Chief Technical Officer of Bitfinex, is one of the attendees at the crypto conference in El Salvador who gained the greatest notoriety. Arduino said in his statement that his company “would redouble its efforts to establish a free, unstoppable, robust, and open Bitcoin and technological infrastructure for El Salvador.”
Overall, Bitfinex has committed to working closely with the government of El Salvador, which is currently mired in debt and is governed by President Nayib Bukele, to devise an appropriate regulatory framework for the cryptocurrency market and other digital assets in the nation. Ifinex, the parent company of Bitfinex, has agreed with the government of El Salvador to work together on developing a regulatory framework for digital assets and securities.
Adverse Circumstances are Met with Further Commitments by Bitcoin Supporters
While adverse market dynamics hindered the optimism around the event, there is a suite of conclusions that indicate the ongoing commitment of Bitcoin leaders and pioneering nations like El Salvador to still pursue the broader adoption of Bitcoin as a payment medium.
As the blockchain industry, as well as all the other financial sectors, witnessed in 2022, the price of Bitcoin and other cryptocurrencies declined primarily due to the Federal Reserve’s strategy of dramatically raising interest rates to curb rising inflation in the United States, which caused the cost of money to increase. Subsequently, the remainder of the decline was caused by a succession of events, including the bankruptcy of organisations involved in cryptocurrency trading and the collapse of currencies such as Terra USD. Large investors sold out these high-risk assets, precipitating a precipitous value decline.
“One Bitcoin Per Day” Plan Proposed by El Salvador’s President
El Salvador’s President, Nayib Bukele, announced that the nation would begin buying one Bitcoin each day starting with November 17, 2022. The use of dollar-cost-averaging (DCA) in Bitcoin transactions is widespread among the community, yet it is unprecedented for a nation-state. When Bukele’s proclamation was made, the nation possessed a Bitcoin treasury that included 2,381 BTC and had a worth of more than $39 million.
So far, Bukele has made it a pattern in the past to acquire a significant quantity of Bitcoin during periods of market instability and to “buy the dip.” This action would signal the end of a nearly five-month pause amid severe bear market circumstances and the collapse of Sam Bankman-massive Fried’s $32 billion FTX enterprise.
According to NayibTracker, Bukele made his most recent purchase of Bitcoin on June 30, 2022. At that time, he paid $1.52 million for 80 Bitcoins (worth around $1.33 million), which works out to an average price of $19,000 per coin.
Bottom Line
Overall, El Salvador’s “Adopting Bitcoin” conference serves as a reminder of the ongoing commitment of crypto pioneers and their belief in the long-term potential of this cutting-edge technological revolution.
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Uncovering the Widespread Adoption and the Advent of the Lightning Network in El Salvador and Lugano
Acknowledging the unprecedented potential of Bitcoin’s Lightning Network, El Salvador and Lugano are two of the most significant adopters of this remarkable technological breakthrough.
El Salvador & Lugano Propel the Bitcoin Adoption
As a cornerstone moment for the Bitcoin economy, a memorandum of understanding (MOU) was signed on 28 October 2022 between the nation of El Salvador and the city of Lugano in Switzerland. Moving forward, the goal of the MOU is to increase the use of Bitcoin not only in their respective areas but also in the states and nations that are nearby.
Overall, the anticipated aims of the partnership include bolstering cooperation in education and research for both El Salvador and Lugano, assisting initiatives to promote the adoption of Bitcoin and other digital tokens in their respective regions, and encouraging the exchange of students and talent between the two countries.
Exploring the Innovation Brought by the Lightning Network
So far, the scalability of the Blockchain has been a significant barrier to the widespread acceptance of cryptocurrencies from their inception. The Lightning Network’s second layer introduces a cutting-edge solution to this matter, as it intervenes by processing transactions outside the first-layer blockchain mainnet while retaining the mainnet’s robust decentralized security model. By bypassing the official Bitcoin blockchain, the Lightning Network can grow Bitcoin transactions per second (TPS), charge reduced fees, and allow new use cases like micropayments.
In addition, the Lightning Network has the potential to bring financial inclusion and freedom to the developing nations involved, in part because it is a trusted and private network that does not require the participation of third parties or intermediaries. Moreover, it could also lessen the likelihood of governments enacting policies restricting the free flow of capital. It also helps people who do not have access to bank accounts by facilitating transactions in a manner that is almost instantaneous and free of charge, thereby making Bitcoin usable not only as a means of payment but also as a means of exchange.
How Lugano is Leading Crypto Adoption in Europe
Lugano appears to have the same goal as El Salvador: to have all local businesses routinely accept cryptocurrencies as a form of payment. However, Lugano does not appear to have the same goal as El Salvador of making Bitcoin or any other cryptocurrency legal tender. Although Lugano does not hold such a position in Switzerland, the city of 70,000 people did launch its Plan B programme approximately seven months ago to increase the use of Bitcoin.
In March of 2022, Lugano announced that it would be implementing the Plan ₿ Initiative. Additionally, the technology company Polygon joined as a critical infrastructure partner. Plan ₿ Foundation, a partnership between the City of Lugano and Tether, the technology company behind the public blockchain that supports the largest stablecoin by market capitalization (USDT), has been announced today. This partnership will allow Bitcoin, Tether, and LVGA payments to be accepted in the city of Lugano.
Tether and the city of Lugano have collaborated to create a Plan ₿ aiming to increase the use of Bitcoin and stablecoins throughout the city. This, in turn, is expected to have a beneficial effect on all aspects of inhabitants’ everyday lives. As a result, the city’s financial system will be revolutionized faster than ever, thanks to the widespread use of Bitcoin.
El Salvador – the Pioneering Nation in the Cryptocurrency
In 2021, El Salvador was the first country to acknowledge Bitcoin as a legal tender. Through this avenue, El Salvador became a pioneer in demonstrating how technologies such as Bitcoin, decentralized ledgers, and peer-to-peer networks can accelerate financial literacy and inclusion
Furthermore, Latin America appears to follow El Salvador’s lead and powering Bitcoin mining farms with natural resources (such as energy generated by geothermal activity). Countries of Costa Rica in Central America and Paraguay in South America are also heading in this direction.
Bottom Line
Since most people in Europe are not yet familiar with this idea, a closer relationship between El Salvador and a nation located in Europe could usher in uncharted territory.
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HolyTransaction adds support for Bitcoin Lightning Network
Today, we are pleased to announce that HolyTransaction is adding support for swapping to Bitcoin on Lightning Network and thus introducing the ability to deposit and withdraw using Lightning Network.
By adding this capability, HolyTransaction is set to revolutionise the speed, cost and security of depositing and withdrawing Bitcoin on to its platform.
Lightning Network is a software stack which sits on top of the Bitcoin blockchain and, as the name implies, ensures faster and cheaper transactions for its users.
Other than super fast speed and lower fees users will notice a new format of address called invoice when they send or receive Bitcoin via the Lightning Network. The team at HolyTransaction reported that the integration has been successful and hassle free.
Lightning Network brings three essential product benefits to the HolyTransaction exchange:
• Instant Payments. With the use of smart contracts security across the network is much higher and because the stack is built ‘on top’ of the Bitcoin network no transaction confirmations are required. This makes instant payments super fast, super secure and, of course, super cheap.
• Scalability. The massive upscale in transactions per second eclipses any traditional legacy payment rail on the market today. Furthermore, payment ‘with click’ becomes a true reality as the need for financial custodians are eliminated.
• Low Cost. Because Lightning Network does not interact directly with legacy Bitcoin infrastructure itself Lightning Network enables transaction with incredibly low fees. This in turn will stimulate economic growth in new and emerging markets.
In real terms this means Bitcoin deposits and withdrawals on HolyTransaction will be much faster and much cheaper when using Lightning Network.
At the time of press average costs for sending a Bitcoin transaction currently stand at around $2 with confirmation times of around 10 minutes. This clearly has limitations. However, a Lightning Network enabled transaction will cost less than $0.01 and take somewhere in the region of 1-3 seconds.
Adopting Lightning Network will make HolyTransaction more attractive for users who wish to send transactions with added security at much lower cost and super fast speed. HolyTransaction is happy to report that Lightning Network has been integrated for both desktop and mobile application versions.
Lightning Network was envisioned in 2015 and has seen significant growth throughout 2021 which has lead to it being regarded as the most popular layer 2 scaling solution on the market for Bitcoin today. With continued adoption Lightning Network may just help to finally realise the original Bitcoin goal of providing a scalable, fast and cheap financial payments network to the world.
The team at HolyTransaction believe the adoption of the Lightning Network is the logical step in the development of the platform. Lightning Network adoption will enable HolyTransaction to continue to provide a first class crypto trading experience and offer competitive fees with super fast finality times.
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Cryptocurrency and the Future of Business
Cryptocurrency and the Future of Business
Cryptocurrency users are still a small minority. The total number of users was at 106 million as of January 2021. That sounds like a lot, but when you consider a global population that is nearing 8 billion, you can see that it is just a tiny fraction of people using crypto.
Whether you are in crypto or not, it is going to have an increasing effect on business. You can see Bitcoin mining operations selling shares on stock exchanges, large businesses looking into uses for crypto coins, and more people taking an interest in buying and using cryptocurrency.
At the current trend, crypto coins are becoming more common every year. If it holds, it might not be a matter of if people start using different cryptocurrencies, it could just be a question of when.
Crypto for International Transactions
In the digital age, businesses are now connected internationally like they never before. Beyond the large multinationals, it is increasingly becoming common for smaller businesses to have significant international connections. This is not only true as it concerns deals with other companies, but businesses now have employees or contractors they work with from around the world.
Using cryptocurrency as a medium of exchange for international transactions could solve a lot of problems for these businesses. First, cryptocurrency could ease the burden of having to convert currency for several different countries. Beyond that, it could also make transactions faster, cheaper and more convenient by cutting out the traditional middlemen that would typically be in the middle of these transactions.
Adoption by Mainstream Institutions
One of the factors that have held back many cryptocurrency markets is the lack of support from mainstream institutions. Banks wouldn’t let you make transactions with crypto exchanges, and it was hard to find businesses that would allow you to use your cryptocurrency. This is changing rapidly.
Beyond the ability of investors to use an ultra fast trading app to make trades, we now see a range of big institutional investors buying cryptocurrency. Along with that, some of the world’s largest financial businesses are starting to work with crypto. As an example, PayPal started offering a range of cryptocurrency services earlier this year. You also have major credit card companies that are starting to work with crypto on a limited level.
Crypto as a Real Store of Value
One of the main claims of many crypto skeptics is that the coins have no inherent value. This is true in a sense. The value of most crypto coins is solely based on the perception of people in the market. While that might be true, you could make the same argument for most fiat currencies. The value is based on the fact that people will accept it in exchange for goods and services.
Crypto has an advantage over many fiat currencies: the fact that many crypto coins have a limited supply. As inflation acts on fiat currencies, crypto could grow in popularity as a hedge. In the future, many investors will hold crypto in the way that they hold gold as a protection against inflation.
Tokens as Business Equity
Raising or distributing equity usually means creating conventional shares of the business. While this could be a way to raise money or provide value to employees, it does come with a range of hurdles. One way to get around many of these hurdles would be to create crypto coins that represent shares in the company.
Instead of jumping through all of the regulatory hoops to issue shares, the business could give people crypto coins as equity. Instead of holding an IPO, the business could do an ICO as a way to raise capital from investors.
Crypto for Crowdfunding
With the rise in crowdfunding platforms, the ability to raise money is easier than it ever has been. These platforms not only make it easy to raise money from the public, but they also offer a level of transparency that is popular among those looking to donate or invest. With that said, these platforms often take a significant portion of the funds in fees.
Using a blockchain wallet for crowdfunding could be a way to get the transparency of a crowdfunding platform while avoiding the fees. This would allow those looking to raise funds to do so off a platform, but with the blockchain ledger, potential donors or investors could still see the donations coming in.
Crypto is a field that is always evolving. As businesses see the benefits and new applications become available, it will become more common. With that said, the markets are unpredictable. The only thing that we can be sure of is that there will be ups and downs along the way.
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Liquid Bitcoin Wallet: HolyTransaction adds support for L-BTC – Bitcoin on the Liquid Network!
Today, we are pleased to announce that HolyTransaction Wallet is adding support for swapping L-BTC and thus introducing the ability to deposit and withdraw bitcoin using Liquid Network.
Bitcoin on the Liquid Network, or L-BTC, is verifiably backed 1:1 by bitcoins on the mainchain as Liquid is a federated sidechain between bitcoin exchanges and market makers. Once the coins are transferred from BTC to L-BTC, HolyTransaction users can take advantage of the massive speed and increased security features.
Why is Liquid support such a big deal?
Liquid Network is capable of operating ten times faster than Bitcoin’s own network, which opens up a world of possibilities for the users, particularly when it comes to the speed, faster transactions, and lower costs of making payments. Imagine having to only wait for one minute for your transaction to be processed, as opposed to at least 10 minutes, which is what Bitcoin’s blockchain requires. That is what Liquid Network offers, and what customers of HolyTransaction will now have the ability to do from within their wallet.
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What Early Mining Patterns Tell Us About The Motives Of Bitcoin’s Inventor
The debate about Bitcoin’s inventor, known as Satoshi Nakamoto but otherwise shrouded in mystery, has raged for years. As Bitcoin continues to rise in value, this unknown inventor is presumed to have become a very rich individual indeed. When Satoshi invented Bitcoin, was he driven to profit, mining and hoarding early Bitcoin aiming to accumulate great wealth?
In 2013 first Sergio Demian Lerner presented his research on the early mining patterns Satoshi is presumed to have taken, it revealed around 1 million BTC (now worth around $10bn) hoarded by the creator. For many who see Bitcoin as an anti-establishment currency with an equalizing power, to attribute such vast wealth to Bitcoin’s creator is anathema, undermining the main narrative around Bitcoin and Nakamoto’s original motives. If Nakamoto is as driven by capitalist economics as the nearest banker, is Bitcoin fundamentally different from traditional currencies after all?
Nakamoto’s defenders argued that these 1 million missing Bitcoin were simply forgotten by early miners, and the inventor himself had no such hoard. Indeed, even researching these Bitcoin was taboo. Yet Lerner was unsatisfied with this answer. That’s why he has spent the last seven years unravelling the mining techniques used to unearth these early Bitcoin. What these techniques reveal is that Satoshi (if that is who mined them, Lerner refers to this individual as “Patoshi” to emphasize that we can’t truly know) seems to have been protecting the security of the network rather than pursuing profit after all. The reputation of Bitcoin, and its mysterious inventor, remains intact.
Early Mining Techniques
In order to learn more about the missing Bitcoin – and the individual who mined them – Lerner decided to remine the first 18,000 Bitcoin blocks to see what it revealed. He assumed that these blocks would have been mined with software that was similar, if not identical, to that which came with the first Bitcoin release. This public code was how early miners set about Bitcoins first blocks. The “Patoshi” pattern of how these Bitcoin were mined could ultimately reveal something about the motives of Bitcoin’s inventor, assuming Nakamoto and Patoshi are one and the same.
Through remining these early blocks, Lerner came to a startling discovery. Patoshi’s software was in fact nothing like the software being used by other early Bitcoin miners. Was this Nakamoto giving himself a leg up in the early gold rush of Bitcoin mining? The difference in the mining patterns of the public software and Patoshi’s processes became the keystone of Lerner’s research. Two theories stood out. Firstly, that Patoshi was using an early version of today’s pooled mining processes by combining multiple CPUs. The second theory – seemingly borne out in Lerner’s research – is that Patoshi was multi-threading.
Patoshi’s Multi-Threading
Multi-threading is a hashing technique using intensive computer processing to sweep for multiple nonces (the cryptographic element that Bitcoin miners are searching for) at once, rather than on an individual basis. By rescanning the early blocks, Lerner was able to assess which nonces Patoshi discovered, thus revealing the patterns by which Bitcoin’s inventor was mining blocks. Ultimately, Lerner has demonstrated that Patoshi/Nakamoto was generally finding higher-value nonces thanks to the multi-threading technique, and not because they had superior processing power, but because they had a better process for using their CPU.
Ideology Before Profit
Lerner’s meticulous analysis of the early mining patterns attributed to Bitcoin’s founder reveal that each time Patoshi mined a new block, his miner was turned off for a short interval. If Nakamoto was driven by profit, this is contradictory behaviour as it gives the rest of the community an opportunity to unearth new blocks. Lerner posits that Nakamoto wanted to see fair competition amongst early miners, and distribute Bitcoin equally at the start of the network.
At the same time, Patoshi’s multi-threading would have allowed them to uncover new blocks when they were not being mined by other early users, thus enabling the network to continue ticking over. These patterns have led Lerner to argue forcefully that the security of the network – and not profit – was Nakamoto’s motivation for their early mining patterns.
Still Unknown
It remains an assumption that Patoshi and Nakamoto are one and the same, and the identity of this individual is still unknown. But Lerner’s research strongly indicates that profit was not an early motivator of the Patoshi pattern.
Kristin Herman is a tech enthusiast and a project manager at Essayroo.com and Boomessays.com online writing services. When she takes a break from the screen she likes to curl up with a good book, albeit one about cryptotrends and digital landscapes!
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