New Online Wallet

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A lot of people still use email, phone or fax as their digital identity; some even use real names or addresses. But they are at risk of identity theft, and they are also at risk of having their privacy violated by other people.

Some new ideas have emerged that promise to make digital identities safer, private, and more convenient. Some of them are already on the market: encryption and digital signatures; the so-called two-factor authentication system that uses a verified phone number and a separate code sent to a user’s mobile phone; and many other ideas that are under development.

But none of these is as safe or convenient yet as the new online wallet, which will authenticate your identity without exposing your name or address, let you prove you own an account by making a digital signature on a file that only you can read, let you do things online with just a few clicks instead of logging into many different sites, allow you access to all your accounts from any computer or mobile device without needing to be physically present in the same place all the time, and make it easy to share your passwords with friends.

There is no single company currently offering this service: what we call a new wallet. There are many people working on the problem.

A sandbox is a place to experiment with new technology. In the late 1990s, the word was used for the early web pages of Netscape, Microsoft, and other companies. In the late 2000s it means an online wallet designed by someone else.

Such a wallet is a sandbox for experts in open source cryptography. It’s a place to test ideas before they are ready for real-world use. The kind of experts who are likely to be using it are non-technical people with half an idea what they are doing and enough credit on their digital identities to try something new. The more advanced users will be people who have figured out how to make money in some way that isn’t bank robbery or selling drugs.

I have never produced anything that had the same kind of impact as Bitcoin. I mean, every day there is a new article about Bitcoin. Every day.

The only time I’ve had as much impact was when I was selling hoodies with the bitcoin logo on them. That was huge, but it was still just a business. People didn’t care about me or my business; they cared about bitcoins.

I’m not saying this is the only way to impact people: you can make art, or start a blog, or do anything else you want. But if you want to have an impact, it seems that the best way is to create something people care about.

Well, maybe. The story of how Bitcoin got started is a lot more interesting than most people realize. It’s the story of a crazy idea that attracted a lot of people who were not crazy.

Because we don’t often think about it, the word “blockchain” is a bit of a mystery. We have no idea what it means, and yet it seems to be everywhere–in the news, in technology blogs, in books about bitcoin. What’s an overhyped buzzword doing in so many places?

The answer is that “blockchain” is not really a buzzword at all. It’s just another way of saying “distributed database.” A distributed database has certain properties. It’s not easy to change its contents without getting everyone to agree on what new contents are; if you change something a single person disagrees with, then there are two different versions of the database–one person’s version and one other person’s version–and you can’t get them both to agree on which one is the real one. If you want your changes to be accepted by everyone who has agreed on the old database, then you have to convince them that your changes are better than their old ones. In other words, you have to convince them by showing them newer and better copies of the database than they already have.

A blockchain works when some group that agrees on the database chooses a member to keep track of who has agreed. If someone disagrees with the choice

Before I started writing about Bitcoin, I had never heard of it. When I decided to write about it, I had no idea what it was or what it could do. But I was willing to find out.

I didn’t have a lot of money at the time, and if you’re writing about something you don’t know anything about, you have to get the basics right. So when I started looking for information about Bitcoin, my first stop was the website. It’s a professional site, with links to academic papers and so on. It seemed like a sensible place to start.

I clicked on one of the links that would take me to “the source code.”

It took me to some stuff called bitcoind , which is what most people call Bitcoin software. The first thing I noticed was that there were two versions, one written in C++ and the other in JavaScript (which is probably more familiar). After that it got really confusing: there were several different versions of bitcoind , each with its own configuration options and commands and interface, none of which made sense to me.

Fortunately someone had already done some research for me: a blog post by Brian Forde . He’d spent some time getting acquainted with bitcoind

I have been writing about digital currency for several years, and I have always had a certain amount of trouble finding my place in the industry. I am probably too early or too late, or something else.

This has recently changed. I now feel that I have found my place, and that is as an observer of a new and emerging financial technology. I am ready to write about it, but it’s not my goal to become rich off it.

What is this emerging new technology? It is Bitcoin. In particular, it is the idea that you can create your own money without having to rely on a central authority — an idea that has been around for thousands of years but has never really caught on because centralized currencies are generally believed to be fundamentally more trustworthy than decentralized ones.

I’m going to talk about Bitcoin from three perspectives: technical, political and historical. But those three points of view don’t exhaust Bitcoin’s scope; there are many other ways in which one can think about Bitcoin.

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