The era of Bitcoin and blockchain technology

bitcoin era

The era of Bitcoin and blockchain technology

What do you think when you talk about Bitcoin, as you seethe technology applied in this type of digital money. Let’s tell the history of the BTC its algorithm and it brings forward. All people have ever heard of bitcoin and cryptocurrencies, asa major future source that can be accepted as a means of payment. The technology applied to speculative form is revolutionary and difficult to understand.

A little history of the BTC

It all begins in the 9th century with the Arabic mathematician Al Juarismi, from which comes the name of “algorithm”. Analgorithm is an automatic mathematical procedure (alsocalled a “protocol”) that executes a default succession of operations. An algorithm is something very old but at the same time modern, because it can run a computer. All the electronic devices around us execute them.

Blockchain technology is a mathematical algorithm. The objective of the algorithm is to decide, without human intervention, the consensus of a network of users: to establish what is the opinion of the majority. This problem seems easy to solve and we know of a solution since antiquity: the electoral consultations. It is sufficient for eachuser to issue a vote and then the algorithm will count. But automating the process is not so simple. For an electoralconsultation it is necessary to have an important logistics:creation of a census, organization of electoral tables, local counts. We do not want anyone to control the process to avoid possible bug or voter fraud.

Census and voter identification are key elements for voters to enter the ballot only once. Although not implemented in practice, voter identification could be automated by electronic ID and cryptography. Cryptography is a branch of mathematics derived from the theory of numbers that allows to encrypt documents, sign them and demonstrate identities. It is used in the Bitcoin network to ensure the authenticity of transactions. But there is another problem even more difficult to solve: we don’t want anyone to control the logistics, not even the process of creating the census. In another way, it could be admitted only in the census to the related and distort the outcome in their kindness.

Blockchain Technology

The blockchain technology and the new cryptocurrencies opens up great perspectives, similar to the Internet revolution of the information world and its transmission. Bitcoin and blockchain technology represent a similar revolution in the monetary field. In the same way that weshould not confuse Internet technology, we must not do it with the blockchain technology and the fever of false projects that abound around it.

Those who fear the new technology for the potential to supplant old banking functions resemble those who feared printing. The energy expenditure of decentralized networksis important, but the global balance is likely to lean towards greater energy efficiency.

You can imagine many other applications of blockchain technology to supplant centralization. Finding in each application the right rules for self regulation is an extremelycomplex mathematical problem. Therefore, apart from the cryptocurrencies, there are few applications for the moment. Even the demonstration that self regulation is ful filled for Bitcoin is a complex problem, where game theory and probability intervene, in which we work some mathematicians.

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