Bitcoin inventor Dr. Craig Wright recently gave a talk at the Global IEEE 5G-IoT Blockchain Summit in Rabat, Morocco. In it, he covered what Bitcoin really is, how it enables true peer-to-peer connectivity, and how it can ultimately become the base layer for a new internet of value. Hear what Dr. Wright had to say through the video link or read our written summary below.
What Bitcoin is, and dispelling some common myths
Bitcoin may be the most misunderstood technology in history. Thirteen years after it was born, very few understand what it is or how it can revolutionize the world. Dr. Wright has been working hard to educate people about Bitcoin, and he begins this presentation by explaining a key point: Bitcoin is not anonymous. Several attempts to create anonymous ‘cryptocurrencies’ existed in the ‘80s and early ‘90s, and they all failed. Bitcoin is different because it offers tracing, meaning it is private but not anonymous.
True peer-to-peer connectivity
Dr. Wright explains that Bitcoin is truly peer-to-peer, facilitating IP to IP transactions, and not only of the monetary kind. It can enable peer-to-peer communication of all kinds, even between machines.
Dispelling the myth that everyone needs to run a full node, Dr. Wright details how Alice and Bob transact directly, whereas Charlie doesn’t care because he doesn’t deal with them and isn’t part of the transaction. He explains how by running SPV, which allows Alice and Bob to keep a record of the transactions between them, will allow Bitcoin to scale to global dimensions. However, he underscores that true global scaling will only be possible with IPv6; IPv4 won’t cut the mustard.
Dr. Wright tells us that the real promise of electronic cash is instant global payments. This changes a lot of things, such as allowing merchants from anywhere in the world to trade instantly and get paid on the spot. He asks us to imagine an artist in Africa displaying artwork in New York without actually traveling there, bringing the money he earns back to his own community.
Other blockchains and how big Bitcoin can become
What about all the other blockchains? Dr. Wright dismisses the notion that we need multiple blockchains and ledgers. He calls this a “daft idea” and likens it to Bernie Madoff keeping multiple sets of books. He explains how Bitcoin acts as a private accounting system that allows these peer-to-peer exchanges to be registered on one immutable blockchain, and since it can scale infinitely, there’s no need for other chains.
Just how big can all of this get? Dr. Wright says that integrating SPV, payment channels, IPv6, and Bitcoin allows for the exchange of 4.3 billion jumbo packets per exchange. This means massive data exchange is possible for minuscule fees. Once you understand this, you begin to understand how Bitcoin can underpin a new internet of value, making models like the ad-based one we’re all so used to obsolete.
IoT Communication Protocol on Bitcoin
There’s been a lot of talk in recent years about the Internet of Things (IoT), but few have stopped considering how all of the hundreds of billions of devices that will be part of it might communicate. Dr. Wright believes Bitcoin is the solution.
Once IPv6 and Bitcoin are integrated, true peer-to-peer communication between devices becomes possible. We can then build a world of fast, efficient IoT communications with no congestion or high fees. This will lead to a world of low network latency, eliminating the need to go through centralized servers, etc. Systems will exchange information directly, leading to a faster, more efficient world. All communication and payments between devices, people, and anything else can be recorded on the blockchain—meaning there’s no altering the past. In this way, Bitcoin becomes the base layer, indexing and integrating all of the communication on this new internet of value.
Outlining the implications of such a system, Dr. Wright explains how this can allow for discovering things such as when hacks occurred, what contracts are still valid as a result of hacks, and more. It can also allow us to find out when updates occur, when compromises occur, and who might be behind them, etc.
In essence, Dr. Wright is painting a picture of a truly peer-to-peer world, where anyone on the planet can exchange value instantly, where even machines can communicate, and where all of it is recorded on an immutable public ledger, ushering in an era of unprecedented transparency and verifiably accurate record keeping. Such a world is only possible because of Bitcoin.
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