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Re: [p2p-research] Bitcoin open source implementation of P2P

Satoshi explains the difference between Bitcoin and Chaumiam cash.

Date: Thu, 12 Feb 2009 19:01:24 +0000
From: Satoshi Nakamoto <>
Subject: Re: [p2p-research] Bitcoin open source implementation of P2P
Martien van Steenbergen wrote:
> Very interesting. Is this akin to David Chaum's anonymous digital money? 
> His concept makes sure money is anonymous unless it is compromised, i.e. 
> the same money spent more than once. As soon as it's compromised, the 
> ‘counterfeiter’ is immediately publicly exposed.

It's similar in that it uses digital signatures for coins, but different 
in the approach to privacy and preventing double-spending.  The 
recipient of a Bitcoin payment is able to check whether it is the first 
spend or not, and second-spends are not accepted.  There isn't an 
off-line mode where double-spenders are caught and shamed after the 
fact, because that would require participants to have identities.

To protect privacy, key pairs are used only once, with a new one for 
every transaction.  The owner of a coin is just whoever has its private key.

Of course, the biggest difference is the lack of a central server.  That 
was the Achilles heel of Chaumian systems; when the central company shut 
down, so did the currency.

> Also, in bitcoin, is there a limited supply of money (that must be 
> managed)? Or is money created exaclty at the moment of transaction?

There is a limited supply of money.  Circulation will be 21,000,000 
coins.  Transactions only transfer ownership.

Thank you for your questions,


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