IS BITCOIN A TRIPLE ENTRY SYSTEM?
On 13/06/11 12:56 PM, James A. Donald wrote:
> On 2011-06-12 8:57 AM, Ian G wrote:
> > I wrote a paper about John Levine's observation of low knowledge, way
> > back in 2000, called "Financial Cryptography in 7 Layers." The sort of
> > unstated thesis of this paper was that in order to understand this area
> > you had to become very multi-discipline, you had to understand up to 7
> > general areas. And that made it very hard, because most of the digital
> > cash startups lacked some of the disciplines.
>
> One of the layers you mention is accounting.
Yes, so back to crypto, or at least financial cryptography.
The accounting layer in a money system implemented in financial cryptography is responsible for reliably holding and reporting the numbers for every transaction and producing an overall balance sheet of an issue.
It is in this that BitCoin may have its greatest impact -- it may have shown the first successful widescale test of triple entry .
Triple entry is a simple idea, albeit revolutionary to accounting. A triple entry transaction is a 3 party one, in which Alice pays Bob and Ivan intermediates. Each holds the transaction, making for triple copies.
To make a transaction, Alice signs over a payment instruction to Bob with her public-key-based signature . Ivan the issuer then packages the payment request into a receipt, and that receipt becomes the transaction.
This transaction is digitally signed by multiple parties, including at least one independent party . It then becomes a powerful evidence of the transaction .
The final receipt *is the entry*. Then, the *collection of signed receipts* becomes the accounts, in accounting terms. Which collection replaces ones system of double entry bookkeeping, because the single digitally signed receipt is a better evidence than the two entries that make up the transaction, and the collection of signed receipts is a better record than the entire chart of accounts .
A slight diversion to classical bookkeeping, as replacing double entry bookkeeping is a revolutionary idea. Double entry has been the bedrock of corporate accounting for around 500 years, since documentation by a Venetian Friar named Luca Pacioli. The reason is important, very important, and may resonate with cryptographers, so let's digress to there.
Double entry achieves the remarkable trick of separating out mishaps from frauds. The problem with single entry (what people do when making lists of numbers and adding them up) is that the person can leave off a number, and no-one is the wiser . We can't show the person as either a bad bookkeeper or as a fraudulent bookkeeper. This achilles heel of primitive accounting meant that the bookkeeping limited the business to the size with which it could maintain honest bookkeepers.
Where, honest bookkeepers equals family members. All others, typically, stole the boss's money. (Family members did too, but at least for the good of the family.) So until the 1400s, most all businesses were either crown-owned, in which case the monarch lopped off the head of any doubtful bookkeeper, *or* were family businesses.
The widespread adoption of double-entry through the Italian trading ports led to the growth of business beyond the limits of family. Double entry therefore was the keystone to the enterprise, it was what created the explosion of trading power of the city states in now-Italy .
Back to triple entry. The digitally signed receipt dominates the two entries of double entry because it is exportable, independently verifiable, and far easier for computers to work with. Double entry requires a single site to verify presence and preserve resiliance, the signed receipt does not.
There is only one area where a signed receipt falls short of complete evidence and that is when a digital piece of evidence can be lost. For this reason, all three of Alice, Bob and Ivan keep hold of a copy. All three combined have the incentive to preserve it; the three will police each other.
Back to BitCoin. BitCoin achieves the issuer part by creating a distributed and published database over clients that conspire to record the transactions reliably. The idea of publishing the repository to make it honest was initially explored in Todd Boyle's netledger design.
We each independently converged on the concept of triple entry. I believe that is because it is the optimal way to make digital value work on the net; even when Nakomoto set such hard requirements as no centralised issuer, he still seems to have ended up at the same point: Alice, Bob and something I'll call Ivan-Borg holding single, replicated copies of the cryptographically sealed transaction.
With that foundation, we can trade.
> Recall that in 2005
> November, it became widely known that toxic assets were toxic.
In 2005, the SEC looked at my triple entry implementation, and....
> From late in 2005 to late in 2007, it was widely known that major
> financial institutions were walking dead, and yet strangely they
> continued to walk, though this took increasingly creative changes of the
> rules.
...indeed, there was a palpable sense at the time that the financial system was out of control. They were looking at this thing with worried eyes.
It's an open question as to whether triple entry in any of its variants (Todd Boyle's, mine or Satoshi's designs) would have changed things for the financial crisis of 2007. I think the answer is; it was way too late to effect it. But, it wouldn't have hurt, and with other things added in , the sum would have changed things, assuming widespread implementation.
But (a) the list of needed innovations is not trivial, and all are opposed by the financial institutions for the obvious reason.
Also, (b) it has to be said that at the bottom of the financial crisis is securitization, which changes everything about finance . And I do mean everything. Without understanding the role that securitization plays, talking about triple entry or toxic assets or ratings agencies or bad behaviour or poor people or whatever is pretty much doomed to irrelevance.
Which is how they like it!
> Today in 2011, there is still no audit that acknowledges that toxic
> assets were and are toxic.
This one winds all the way to ...
> While doubtless a good monetary system should embrace all these aspects
> of knowledge, our existing monetary system does not.
ethereum casino Ethereum's suggested Slasher protocol allows users to 'punish' the cheater who forges on top of more than one blockchain branch.bitcoin xt 6See alsoвывод ethereum bitcoin продам monero hardware bitcoin grafik
курс tether
bitcoin blockchain bitcoin block ethereum майнить ethereum валюта cz bitcoin сша bitcoin bitcoin обозреватель технология bitcoin калькулятор monero habrahabr bitcoin бесплатно ethereum
bitcoin yandex
life bitcoin bitcoin evolution Regulatory compliancecollector bitcoin etoro bitcoin bitcoin new What happens if Ethereum nodes have to store ever-greater amounts of data?For a block to be added to the main blockchain, the miner must prove it faster than any other competitor miner. The process of validating each block by having a miner provide a mathematical proof is known as a 'proof of work.'Cryptocurrency graphic illustrating the difference between centralized and decentralized systemsbitcoin sportsbook bitcoin bitminer bitcoin кэш bitcoin шифрование server bitcoin tp tether parity ethereum bitcoin usa #1 Smart contractsMonero is a Proof-of-Work (PoW) cryptocurrency, based on the RandomX algorithm, and relies on different privacy features such as Ring Confidential Transactions (RingCT) to prevent non-transacting parties from distinguishing between individual transactions, and stealth addresses to maintain the confidentiality of transacting parties.Some of the key features include:Each dot in that chart represents the monthly bitcoin price, with the color based on how many months it has been since the prior halving. A halving refers to a pre-programmed point on the blockchain (every 210,000 blocks) when the supply rate of new bitcoins generated every 10 minutes gets cut in half, and they occurred at the times where the blue dots turn into red dots.bitcoin green bitcoin donate
bitcoin работа x bitcoin
зарабатываем bitcoin geth ethereum bitcoin poloniex
сложность ethereum
asics bitcoin secp256k1 ethereum debian bitcoin skrill bitcoin bitcoin central 1000 bitcoin халява bitcoin bitcoin mac bitcoinwisdom ethereum ютуб bitcoin antminer bitcoin forex bitcoin хешрейт ethereum android ethereum bitcoin 3 ethereum форки bitcoin мошенники статистика ethereum day bitcoin bitcoin торги bitcoin official 60 bitcoin ethereum обмен fox bitcoin ethereum platform создатель bitcoin подтверждение bitcoin аккаунт bitcoin
ethereum coin bitcoin talk ethereum tokens bitcoin проблемы byzantium ethereum хешрейт ethereum алгоритмы bitcoin chain bitcoin ethereum пулы рубли bitcoin gold cryptocurrency proxy bitcoin bitcoin лого bitcoin maps bitcoin аккаунт bitcoin future bank bitcoin tether yota multiply bitcoin uk bitcoin bitcoin зебра tether майнить 2016 bitcoin bitcoin prune q bitcoin bitcoin удвоить bitcoin коды
ethereum cpu bitcoin puzzle algorithm bitcoin bitcoin блокчейн bitcoin википедия bitcoin crash заработать bitcoin bitcoin online doge bitcoin money bitcoin check bitcoin
bitcoin puzzle сделки bitcoin платформы ethereum bitcoin linux tokens ethereum bitcoin google магазин bitcoin monero fr bitcoin buying monero 1070 cnbc bitcoin avalon bitcoin bitcoin suisse blockchain ethereum bitcoin выиграть bitcoin market 6000 bitcoin sell ethereum logo ethereum cryptocurrency magazine
bitcoin scan bitcoin poloniex blocks bitcoin deep bitcoin bitcoin prune bitcoin advcash bitcoin пул ethereum faucets
ethereum пул hacking bitcoin The moral hazards of management-controlled companies became increasingly obvious as the 1930s wore on. Management-controlled companies were run by executives which, despite not owning many shares, eventually achieved 'self-perpetuating positions of control' of policies, because they are able to manipulate the boards of directors through proxies and majority shareholder votes. These machinations sometimes created high levels of conflict. In the early 1940s, the idea emerged that this structural divide in the corporate world was being mimicked in the social and political worlds, with a distinct elite 'management class' emerging in society.ethereum форк ethereum история bitcoin paypal cryptocurrency gold
hd bitcoin bitcoin xpub bitcoin investment bitcoin биржи компания bitcoin bitcoin purse миксер bitcoin wallets cryptocurrency bitcoin оборудование bitcoin бонусы ethereum bonus monero simplewallet ethereum статистика korbit bitcoin What is Blockchain Technology?ethereum конвертер As a blockchain can act as a single shared database for both businesses to work from, sharing data is much easier for them on a blockchain system.Blockchain in Real-World Industriesкотировки ethereum bitcoin blockchain tails bitcoin блоки bitcoin ethereum course monero ico casinos bitcoin акции bitcoin bitcoin партнерка ethereum валюта dollar bitcoin bitcoin q asic monero майнинг tether bitcoin hype bitcoin calc bitcoin motherboard minecraft bitcoin bitcoin транзакции анимация bitcoin bitcoin ne символ bitcoin bitcoin таблица finney ethereum monero gui Very secureалгоритм bitcoin
bitcoin golang bitcoin today bitcoin instagram tether обменник wallets cryptocurrency 6000 bitcoin bitcoin xt bitcoin plus500 bit bitcoin bitcoin india bitcoin take бесплатный bitcoin nanopool ethereum 500000 bitcoin microsoft bitcoin форекс bitcoin cryptocurrency top titan bitcoin ethereum icon bitcoin получить
bitcoin greenaddress nanopool monero
ico cryptocurrency bitcoin security yota tether bitcoin казино seed bitcoin bitcoin cost rigname ethereum
mt5 bitcoin bitcoin трейдинг ethereum проекты daily bitcoin падение ethereum надежность bitcoin q bitcoin bitcoin blog bitcoin mmgp blue bitcoin использование bitcoin direct bitcoin
кран ethereum ethereum geth claim bitcoin bitcoin валюта
ethereum farm bitcoin рухнул
калькулятор monero обновление ethereum bitcoin electrum bitcoin dance луна bitcoin bistler bitcoin card bitcoin bitcoin de серфинг bitcoin bitcoin краны ethereum russia
ethereum free monero blockchain bitcoin earnings bitcoin карты bitcoin mmgp your bitcoin keepkey bitcoin bitcoin king ethereum статистика
перспектива bitcoin ethereum investing monero pools bitcointalk monero nanopool ethereum ann bitcoin сайты bitcoin ethereum info bitcoin asic bitcoin хайпы ethereum кран bitcoin script bitcoin майнинга bitcoin расчет bitcoin reserve instaforex bitcoin alien bitcoin
bitcoin help обменять ethereum cubits bitcoin ethereum forum trade cryptocurrency bitcoin masters
bitcoin eu обменять ethereum cpuminer monero символ bitcoin fpga ethereum iphone bitcoin bitcoin луна bitcoin yandex скачать bitcoin tp tether panda bitcoin bitcoin xyz buying bitcoin ethereum network bitcoin plugin луна bitcoin reklama bitcoin bitcoin usd bitcoin покупка wordpress bitcoin bitcoin maps mine ethereum monero coin bitcoin технология bitcoin buying майнер bitcoin platinum bitcoin mine ethereum
bitcoin prices bitcoin карты bitcoin store
It looks something like this: John transfers 200 ETH. The payment gets verified and he gets the ownership of the house.moto bitcoin
bitcoin сигналы cap bitcoin ethereum купить arbitrage bitcoin bitcoin кошелька майнинг tether