A read block chain and bitcoin contact

A read block chain and bitcoin contact

   

The birth of the Internet in 1969, all aspects of human social life and subversion, it redefines the communications, media, retail and so on. The past two years, like a century on 70s Internet technology innovation and technology are as hot air plant. It has changed the financial, change people’s lifestyle, change the business form of potential again, this new technology is the chain block.

Block chain is the underlying technology agreement bitcoin, since 2008 with bitcoin hot, block chain technology has attracted the attention of the world bank. Distributed books, to the center of the trust, timestamp, asymmetric encryption, smart. Five major technical characteristics, let the block chain become terrible power can subvert the traditional banking industry.

Why is there a block chain?

The reason of the Internet is to create and solve the problem of information transmission, and the block chain is in order to solve the manufacturing and transfer of value. Understanding the blockchain logic background and technology of the Internet can make us better.

Before that information technology is available on the Internet, the human way of transmitting information by the flames of communication, feibook later, Telegraph and telephone, but the speed and capacity of information dissemination is still very limited. With the development of computer technology and computer language mature, scientists began to use the Internet to solve the problem of information transmission and manufacturing.

In 1970s the United States Department of defense military network, the ARPANET has formed dozens of computer networks, like LAN, Internet, communication between these networks only within the network computer, between different networks is an information island. Until 1974, the researchers designed to each information island linked network protocol (including Internet Protocol IP and transmission control protocol TCP), which can make all the computer Internet internet. During the period of Clinton as president of the United States, the U.S. government announced the implementation of the national information infrastructure construction, build the information superhighway, so the American people can easily share information resources.

Only follow the same protocol, between different networks to exchange, as different countries people must understand the language of a common language to communicate, IP/TCP technology is the internet protocol link is the international language of english. In the Internet, web programming must follow the HTTP protocol, or website can not communicate; mail mailbox system required by the SMTP protocol to communicate information, otherwise the message cannot be delivered; if not all unified agreement, communication between each other will appear. A computer network is to follow the IP/TCP protocol, to join the Internet, so as to realize the information sharing, production, dissemination and reproduction.

Block chain is a kind of network protocol, if the internet protocol technology of information transmission, so the technical agreement is the value chain block transmission.

Transmission and information, human to realize high efficiency and security value transfer has also experienced a long historical process. Before the money does not appear, the value of the flow can barter, with 100 pounds of potatoes for a sheep, I need to carry the potatoes to the market, you need to put the sheep to the market; business may not talk about, this way may be bandits robbed, the transaction process is not only high cost and high risk. Later in order to reduce the risks and costs of the transaction with shells, silk, gold coins and paper money, more and more light and easy to carry goods as intermediary transactions “”. But with the expansion of human society and the size of the trading range, such as international trade, in order to reduce the transaction cost and risk coefficient, the invention of “credit”, credit establishment need more the center of ancient and modern national bank escort, and bank and the courts, the police, in order to ensure that the “credit” is not established.

It is not difficult to find, before the advent of the Internet, the information transfer is a high efficiency and low cost. Since the Internet can transmit information, so why can’t we use the Internet to deliver value, value transfer as information transmission as instant?

And the transmission of information is different, the value of the transfer is special: information can be shared and copy, not value. We will press a copy to another site or circle of friends, so there will be two copies of the information, can let more people receive this information and share again; but we cannot copy the payment of money to the other account, but from his account lost a sum of money, let the other side increase the amount of money of account. In addition, the transfer of information does not involve credit, while the value of the transferred credit endorsement, we can freely forwards the information to a stranger, but we dare not put a sum of money to a stranger.

We find that the Internet does not allow the value as information freely, transfer at any time, if you use the Internet to solve the value transfer needs to solve three problems: first, to ensure that only the transfer of value, which is not like information can be copied, can not the same value passed to more people; second, to ensure that the value of exchange is you can trust each other, for example, to my money is not money, by P2P financial money to lend to each other at the appointed time the arrival of repayment; third, to ensure that both sides can rely on the value transfer mechanism of network autonomous and automatic execution, without third party intervention.

Methods to solve the credit problem in the traditional banking, securities and other financial industry is by way of endorsement, such as banks to use national credit endorsement, the building was built, that I will not easily collapse or run away. Alipay, PayPal and other three party payment tool to solve the credit problem is the idea of big data, compared to bank loans by the end of the air you investigate this kind of artificial credit, through big data to do a credit investigation is more advanced, but the Internet payment instruments in essence is still a center of value transfer tool, Internet third party payment form data is absolutely not sharing of internal resources, no boundaries, which appeared in the “big data” and “data island”, that is to say the credit Alipay big data does not pay by letter to WeChat, WeChat to pay in the dishonesty and will not affect alipay. Although the third party Internet payment in the transfer of value is an advanced, but the essence is a center of financial intermediation, and cannot achieve the sharing of credit.

The core problem of block chain technology is to solve the “transfer of value”, so that the value of information in the same as does not require third party intermediary, safety under the condition of rapid circulation. Block chain to achieve picture is that anyone can do not need a bank, Alipay, the center of the credit intermediary, rest assured that the money transferred to any of you even do not know the name of the people, and to borrow money interest and principal to press about the arrival of a business; in the contract, both contract case the transaction, payment can amount to account, without the need for banks to do the intermediary, waiting for the account period; you do not need to go abroad to exchange foreign currency, but the use of electronic currency for global unity, to achieve global monetary unification. The block chain technology, will allow the bank, Alipay and three party credit intermediary does not have the meaning of existence.

How to realize the value chain block transfer?

Let the value sharing and free flow of information like, we need to solve two problems: first, the information can be copied, the information is not the issue of property rights, but the value of property ownership, how to solve the contradiction of property rights and sharing; second, how to solve the credit problems in sharing, establishment of a need not go intermediary credit system.

2008 to block chain as the underlying technology agreement bitcoin was born, the way to resolve the two difficulties in value transfer. Bitcoin developer and founder of a Japanese American low-key and mysterious, Nakamoto, in 2008 he published an article on the Internet in a discussion of information encryption mail group, the basic framework of the outline of the bitcoin system, let difficulties through the internet transfer smoothly done or easily solved value. Nakamoto So that can not rely on a center to establish credit, such as banks, securities, government and other types of credit intermediary, the center of the credit is due to asymmetric information, there is power to harm the interests of the participants, the center of damage to other interests in the market. History has proved that the violation of the rules is the rule makers, the core purpose of bitcoin is a kind of invention does not need the third party, without intermediary, the automatic operation of the payment system, is the electronic currency payment system, the authority of the electronic currency payment system in the credit does not depend on the center endorsement, but build machine credit. Programmable financial.

The establishment of mutual trust between the two governments, enterprises have difficulties, a global consensus is not easy credit system in the political, economic and cultural complex world. Although there are many different countries in the world, but each civilization was able to reach a consensus on the science of mathematics, mathematics is the common denominator of human civilization, like the Internet, through the mathematical algorithm (program) to establish rules, may be able to make people of different cultural backgrounds to obtain credit agreement.

An open source project to establish the Cong bitcoin in 2009, officially declared the birth of bitcoin. The underlying network protocol technology is the use of bitcoin blockchain, and Internet IP/TCP protocol can ensure that a single network can join the Internet interoperability, such a common use of the technical agreement, to ensure the circulation and the value of the flow of credit.

The essence of the blockchain is a decentralized database, a data block cryptography method for generating association, each data block contains the whole network transactions within a period of time the information is used to verify the validity of the information and generates the next block.

The blockchain simply understood as a national accounting technology (distributed ledger Technology): all transactions account by the bank to grasp Alipay trading books by the Alibaba to master, this is a typical type of database center. So, now using the block chain technology, each person’s own account of his mind, each have their own one of the accounts, when someone needs to deal with others, and the two men had other people trading books can become evidence to verify the credit, the credit of both sides are reliable, thus forming a “everybody for me, I was all the credit system, will no longer need third party credit endorsement.

A block chain composed of many nodes, each node is usually a computer, each participating node will update the database transaction information, the system will choose the fastest and best account of a node in a period of time, let it charge in this period of time, it will take this time the variation within the data recorded in a data block; we can put a block to imagine every time you go to the bank to withdraw money, transfer a file to the detailed records of the bill counter. In the last node entry is completed, the node will put on this page to send books to other nodes, until after the confirmation in his books. Every bill in the bank is in the form of chain block to record the change of the new block books in this period, each block contains three kinds of information: the ID area, a number of transactions, before a block of ID. A new and accurate statement will be issued to each node in the system, each node of the whole system are exactly the same as the general ledger.

A computer program that the account is a block chain technology and distributed technology general ledger. Since each node has an update of the general ledger, the weight of each node in the system is the same, with a node’s data will not be verified by other nodes, which makes the “accounting fraud and credit fraud becomes impossible; complete account update of the each node will have a copy, which means destroying some nodes will not affect the whole block chain system.

We can use the principle of real life situation to understand the blockchain: if you request to the bank for the loan, so banks need to survey your credit and ability to repay the loan, such as your past debts, how often you have mortgage assets; in the blockchain situation, and you have the related transactions block for you to prove and verify the credit, such as your purchase, income, trading block will automatically verify your loan repayment ability. Block chain become verified identity, wealth confirmation, transaction records, justice verification technology and rule system in the network world, opened a need for intermediary credit and payment system does not require third party. Because of the block chain and create a distributed, decentralized and procedural mode of credit, “the economist” magazine image to it as “trust machine”, with the maturity and evolution of the blockchain technology, we can not provide loan repayment ability, need to prove the case of mortgage assets can the loan, and the loan of Party A is not a bank, but any such a sum of money, also don’t need to worry about the maturity of the loan can not be recovered.

Popular bitcoin triggered a global concern on the block chain technology, various types of bitcoin is emerge in an endless stream. Bitcoin’s intention is to construct a value transfer of the Internet, the formation of a reliable, free, non center, orderly world currency trading. The key, go to the center of the transaction mode based on block chain formation, not only to ensure the safety of value transfer, also greatly reduce the cost of credit transactions, the central bank issued currency will no longer rely on, banks will not be the monopoly of financial power, the traditional financial system will be undermined, the global monetary unification, for everyone bank, point of financial transactions vision will be realized.

At present, with the formation of programmable block chain technology has been included in the financial stocks, private equity and other areas have a preliminary application, there are four main application areas: one is the transaction point, such as P2P based cross-border payment and remittance, settlement, securities, futures, financial derivatives trading, improve the bank’s payment and settlement efficiency, reduce the cost of cross-border payments; second is the registration, block chain with machine credit, traceability features, can be used as a reliable database to record all kinds of information, such as the use of anti money laundering in the storage of customer identity information and transaction records; the third is right, such as land ownership, equity contracts and property the authenticity verification and transfer; the fourth is intelligent management, such as the future of the “smart contract” will be set in advance of the trading conditions reached when the contract will be automatically processed, such as automatic payment of interest and dividends.

Is the subversion of the social chain block

In addition to the subversion of the financial industry, the blockchain technology was also applied in other fields, such as in law, retail, networking, medical and other fields to solve the problem of trust, no longer rely on third parties to establish credit and credit sharing, will improve the efficiency of the whole industry.

When the block chain technology in the whole society the depth of application, the existing commercial society will be subverted. The modern commercial society originated in Europe in the seventeenth Century, the formation of modern commercial society has three basic business system, namely legal system of double entry bookkeeping, the company system, the protection of private property.

Double entry method is compared with the single entry method, double entry bookkeeping to record each business in two or more than two related account transactions, namely double records, accounting method which can complete system changes the sequence of events and reaction funds operating results. While the distributed technology will subvert the double entry bookkeeping ledger, make all transactions reliable and traceable.

Second subversion is the formation of block chain technology for distributed autonomous companies and organizations will subvert the business organization, distributed autonomous companies and organizations to run through smart contracts, equity becomes the only currency system operation, anyone can join and leave at any time, the structure of the company’s operation is greatly simplified, only investors and producers.

Third, the legal system of protecting private property will also be intelligent contract form to achieve. All your assets is a digital currency, as long as you do not hand over the blockchain private key, no one will take away your assets, no one can change and termination of contract intelligence. Distributed autonomous company in violation of the law system of supervision will be deducted as a penalty for digital currency program.

The moment to block chain, as the Internet in 1969, a new change of the whole society force is quietly growing. The birth of the Internet in 1969, all aspects of human social life and subversion, it redefines the communications, media, retail and so on. The past two years, like a century on 70s Internet technology innovation and technology are as hot air plant. It has changed the financial, change people’s lifestyle, change the business form of potential again, this new technology is the chain block.

Block chain is the underlying technology agreement bitcoin, since 2008 with bitcoin hot, block chain technology has attracted the attention of the world bank. Distributed books, to the center of the trust, timestamp, asymmetric encryption, smart. Five major technical characteristics, let the block chain become terrible power can subvert the traditional banking industry.

Why is there a block chain?

The reason of the Internet is to create and solve the problem of information transmission, and the block chain is in order to solve the manufacturing and transfer of value. Understanding the blockchain logic background and technology of the Internet can make us better.

Before that information technology is available on the Internet, the human way of transmitting information by the flames of communication, feibook later, Telegraph and telephone, but the speed and capacity of information dissemination is still very limited. With the development of computer technology and computer language mature, scientists began to use the Internet to solve the problem of information transmission and manufacturing.

In 1970s the United States Department of defense military network, the ARPANET has formed dozens of computer networks, like LAN, Internet, communication between these networks only within the network computer, between different networks is an information island. Until 1974, the researchers designed to each information island linked network protocol (including Internet Protocol IP and transmission control protocol TCP), which can make all the computer Internet internet. During the period of Clinton as president of the United States, the U.S. government announced the implementation of the national information infrastructure construction, build the information superhighway, so the American people can easily share information resources.

Only follow the same protocol, between different networks to exchange, as different countries people must understand the language of a common language to communicate, IP/TCP technology is the internet protocol link is the international language of english. In the Internet, web programming must follow the HTTP protocol, or website can not communicate; mail mailbox system required by the SMTP protocol to communicate information, otherwise the message cannot be delivered; if not all unified agreement, communication between each other will appear. A computer network is to follow the IP/TCP protocol, to join the Internet, so as to realize the information sharing, production, dissemination and reproduction.

Block chain is a kind of network protocol, if the internet protocol technology of information transmission, so the technical agreement is the value chain block transmission.

Transmission and information, human to realize high efficiency and security value transfer has also experienced a long historical process. Before the money does not appear, the value of the flow can barter, with 100 pounds of potatoes for a sheep, I need to carry the potatoes to the market, you need to put the sheep to the market; business may not talk about, this way may be bandits robbed, the transaction process is not only high cost and high risk. Later in order to reduce the risks and costs of the transaction with shells, silk, gold coins and paper money, more and more light and easy to carry goods as intermediary transactions “”. But with the expansion of human society and the size of the trading range, such as international trade, in order to reduce the transaction cost and risk coefficient, the invention of “credit”, credit establishment need more the center of ancient and modern national bank escort, and bank and the courts, the police, in order to ensure that the “credit” is not established.

It is not difficult to find, before the advent of the Internet, the information transfer is a high efficiency and low cost. Since the Internet can transmit information, so why can’t we use the Internet to deliver value, value transfer as information transmission as instant?

And the transmission of information is different, the value of the transfer is special: information can be shared and copy, not value. We will press a copy to another site or circle of friends, so there will be two copies of the information, can let more people receive this information and share again; but we cannot copy the payment of money to the other account, but from his account lost a sum of money, let the other side increase the amount of money of account. In addition, the transfer of information does not involve credit, while the value of the transferred credit endorsement, we can freely forwards the information to a stranger, but we dare not put a sum of money to a stranger.

We find that the Internet does not allow the value as information freely, transfer at any time, if you use the Internet to solve the value transfer needs to solve three problems: first, to ensure that only the transfer of value, which is not like information can be copied, can not the same value passed to more people; second, to ensure that the value of exchange is you can trust each other, for example, to my money is not money, by P2P financial money to lend to each other at the appointed time the arrival of repayment; third, to ensure that both sides can rely on the value transfer mechanism of network autonomous and automatic execution, without third party intervention.

Methods to solve the credit problem in the traditional banking, securities and other financial industry is by way of endorsement, such as banks to use national credit endorsement, the building was built, that I will not easily collapse or run away. Alipay, PayPal and other three party payment tool to solve the credit problem is the idea of big data, compared to bank loans by the end of the air you investigate this kind of artificial credit, through big data to do a credit investigation is more advanced, but the Internet payment instruments in essence is still a center of value transfer tool, Internet third party payment form data is absolutely not sharing of internal resources, no boundaries, which appeared in the “big data” and “data island”, that is to say the credit Alipay big data does not pay by letter to WeChat, WeChat to pay in the dishonesty and will not affect alipay. Although the third party Internet payment in the transfer of value is an advanced, but the essence is a center of financial intermediation, and cannot achieve the sharing of credit.

The core problem of block chain technology is to solve the “transfer of value”, so that the value of information in the same as does not require third party intermediary, safety under the condition of rapid circulation. Block chain to achieve picture is that anyone can do not need a bank, Alipay, the center of the credit intermediary, rest assured that the money transferred to any of you even do not know the name of the people, and to borrow money interest and principal to press about the arrival of a business; in the contract, both contract case the transaction, payment can amount to account, without the need for banks to do the intermediary, waiting for the account period; you do not need to go abroad to exchange foreign currency, but the use of electronic currency for global unity, to achieve global monetary unification. The block chain technology, will allow the bank, Alipay and three party credit intermediary does not have the meaning of existence.

How to realize the value chain block transfer?

Let the value sharing and free flow of information like, we need to solve two problems: first, the information can be copied, the information is not the issue of property rights, but the value of property ownership, how to solve the contradiction of property rights and sharing; second, how to solve the credit problems in sharing, establishment of a need not go intermediary credit system.

2008 to block chain as the underlying technology agreement bitcoin was born, the way to resolve the two difficulties in value transfer. Bitcoin developer and founder of a Japanese American low-key and mysterious, Nakamoto, in 2008 he published an article on the Internet in a discussion of information encryption mail group, the basic framework of the outline of the bitcoin system, let difficulties through the internet transfer smoothly done or easily solved value. Nakamoto So that can not rely on a center to establish credit, such as banks, securities, government and other types of credit intermediary, the center of the credit is due to asymmetric information, there is power to harm the interests of the participants, the center of damage to other interests in the market. History has proved that the violation of the rules is the rule makers, the core purpose of bitcoin is a kind of invention does not need the third party, without intermediary, the automatic operation of the payment system, is the electronic currency payment system, the authority of the electronic currency payment system in the credit does not depend on the center endorsement, but build machine credit. Programmable financial.

The establishment of mutual trust between the two governments, enterprises have difficulties, a global consensus is not easy credit system in the political, economic and cultural complex world. Although there are many different countries in the world, but each civilization was able to reach a consensus on the science of mathematics, mathematics is the common denominator of human civilization, like the Internet, through the mathematical algorithm (program) to establish rules, may be able to make people of different cultural backgrounds to obtain credit agreement.

An open source project to establish the Cong bitcoin in 2009, officially declared the birth of bitcoin. The underlying network protocol technology is the use of bitcoin blockchain, and Internet IP/TCP protocol can ensure that a single network can join the Internet interoperability, such a common use of the technical agreement, to ensure the circulation and the value of the flow of credit.

The essence of the blockchain is a decentralized database, a data block cryptography method for generating association, each data block contains the whole network transactions within a period of time the information is used to verify the validity of the information and generates the next block.

The blockchain simply understood as a national accounting technology (distributed ledger Technology): all transactions account by the bank to grasp Alipay trading books by the Alibaba to master, this is a typical type of database center. So, now using the block chain technology, each person’s own account of his mind, each have their own one of the accounts, when someone needs to deal with others, and the two men had other people trading books can become evidence to verify the credit, the credit of both sides are reliable, thus forming a “everybody for me, I was all the credit system, will no longer need third party credit endorsement.

A block chain composed of many nodes, each node is usually a computer, each participating node will update the database transaction information, the system will choose the fastest and best account of a node in a period of time, let it charge in this period of time, it will take this time the variation within the data recorded in a data block; we can put a block to imagine every time you go to the bank to withdraw money, transfer a file to the detailed records of the bill counter. In the last node entry is completed, the node will put on this page to send books to other nodes, until after the confirmation in his books. Every bill in the bank is in the form of chain block to record the change of the new block books in this period, each block contains three kinds of information: the ID area, a number of transactions, before a block of ID. A new and accurate statement will be issued to each node in the system, each node of the whole system are exactly the same as the general ledger.

A computer program that the account is a block chain technology and distributed technology general ledger. Since each node has an update of the general ledger, the weight of each node in the system is the same, with a node’s data will not be verified by other nodes, which makes the “accounting fraud and credit fraud becomes impossible; complete account update of the each node will have a copy, which means destroying some nodes will not affect the whole block chain system.

We can use the principle of real life situation to understand the blockchain: if you request to the bank for the loan, so banks need to survey your credit and ability to repay the loan, such as your past debts, how often you have mortgage assets; in the blockchain situation, and you have the related transactions block for you to prove and verify the credit, such as your purchase, income, trading block will automatically verify your loan repayment ability. Block chain become verified identity, wealth confirmation, transaction records, justice verification technology and rule system in the network world, opened a need for intermediary credit and payment system does not require third party. Because of the block chain and create a distributed, decentralized and procedural mode of credit, “the economist” magazine image to it as “trust machine”, with the maturity and evolution of the blockchain technology, we can not provide loan repayment ability, need to prove the case of mortgage assets can the loan, and the loan of Party A is not a bank, but any such a sum of money, also don’t need to worry about the maturity of the loan can not be recovered.

Popular bitcoin triggered a global concern on the block chain technology, various types of bitcoin is emerge in an endless stream. Bitcoin’s intention is to construct a value transfer of the Internet, the formation of a reliable, free, non center, orderly world currency trading. The key, go to the center of the transaction mode based on block chain formation, not only to ensure the safety of value transfer, also greatly reduce the cost of credit transactions, the central bank issued currency will no longer rely on, banks will not be the monopoly of financial power, the traditional financial system will be undermined, the global monetary unification, for everyone bank, point of financial transactions vision will be realized.

At present, with the formation of programmable block chain technology has been included in the financial stocks, private equity and other areas have a preliminary application, there are four main application areas: one is the transaction point, such as P2P based cross-border payment and remittance, settlement, securities, futures, financial derivatives trading, improve the bank’s payment and settlement efficiency, reduce the cost of cross-border payments; second is the registration, block chain with machine credit, traceability features, can be used as a reliable database to record all kinds of information, such as the use of anti money laundering in the storage of customer identity information and transaction records; the third is right, such as land ownership, equity contracts and property the authenticity verification and transfer; the fourth is intelligent management, such as the future of the “smart contract” will be set in advance of the trading conditions reached when the contract will be automatically processed, such as automatic payment of interest and dividends.

Is the subversion of the social chain block

In addition to the subversion of the financial industry, the blockchain technology was also applied in other fields, such as in law, retail, networking, medical and other fields to solve the problem of trust, no longer rely on third parties to establish credit and credit sharing, will improve the efficiency of the whole industry.

When the block chain technology in the whole society the depth of application, the existing commercial society will be subverted. The modern commercial society originated in Europe in the seventeenth Century, the formation of modern commercial society has three basic business system, namely legal system of double entry bookkeeping, the company system, the protection of private property.

Double entry method is compared with the single entry method, double entry bookkeeping to record each business in two or more than two related account transactions, namely double records, accounting method which can complete system changes the sequence of events and reaction funds operating results. While the distributed technology will subvert the double entry bookkeeping ledger, make all transactions reliable and traceable.

Second subversion is the formation of block chain technology for distributed autonomous companies and organizations will subvert the business organization, distributed autonomous companies and organizations to run through smart contracts, equity becomes the only currency system operation, anyone can join and leave at any time, the structure of the company’s operation is greatly simplified, only investors and producers.

Third, the legal system of protecting private property will also be intelligent contract form to achieve. All your assets is a digital currency, as long as you do not hand over the blockchain private key, no one will take away your assets, no one can change and termination of contract intelligence. Distributed autonomous company in violation of the law system of supervision will be deducted as a penalty for digital currency program.

The moment to block chain, as the Internet in 1969, a new change of the whole society force is quietly growing.

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