Cryptocurrency’s weird & unknown history


Welcome to the daily exchange guys we’re here talking about three things that you probably never knew about cryptocurrency. Alright, so here we go. Number one, Bitcoin was not the world’s first cryptocurrency. Before Bitcoin launched in 2009, there had been several attempts at creating a global digital currency using elements of cryptography. One of the earliest of these was David Chaum’s eCash, which debuted all the way back in 1983. eCash was introduced as a way of ensuring privacy and digital payments, Chaum expected digital payments would gain popularity following the growth of electronic banking services, you know, available to consumers. Through eCash Chaum introduced some of the fundamentals of cryptocurrency, public and private key cryptography. That’s pretty important stuff. Chaum used these concepts in his innovative blind signature system. Now blind signatures essentially allowed anonymous payments between two parties that would be later claimed in physical money from a bank while preventing double spending. The system protected the identity of the payer while ensuring the recipient and the bank were not the victims of double spending. Now, according to Bitcoin magazine, Chaum’s obsession with privacy is an iconic part of his identity. He famously he keeps his age and mystery and is considered the godfather of the Cypherpunk movement itself. To this day, Chaum is still involved in cryptocurrency and recently launched the Elixxir platform which claims to be the fastest blockchain ever. Another deeply influential predecessor to Bitcoin is Adam Back’s. 1997 invention, Hashcash. Hashcash was one of the most successful pre Bitcoin cryptocurrencies, and popularized proof of work as a fundamental part of cryptocurrency. Back used the proof of work system to prevent spam and denial of service attacks which made attacks energy intensive for attackers themselves while remaining affordable for regular users. The hashcash protocol was also adopted beyond cryptocurrency and used to prevent email spam. In fact, hashcash was so influential that influenced bitcoins proof of work mining system and was one of the only eight references in the Bitcoin white paper. Adam back is still a household name in cryptocurrency and founded the tech company Blockstream in 2014. It is a global leader in Bitcoin and blockchain technology. Blockstream is the creator of the Bitcoin liquid network a key contributor to the Bitcoin lightning network and even has satellites broadcasting from space to ensure the Bitcoin blockchain is available worldwide without interruption. Around the same time as hashcash was another digital currency called b-money created by Wei Dai. He introduced the idea of a distributed ledger, and as such was another of the rare references in the Bitcoin whitepaper. Number two. While banks today scramble to understand how cryptocurrency and digital assets will disrupt the status quo. One bank in the 90s had already embraced crypto. As mentioned earlier, David Chaum’s invented eCash in the 80s as a way of sending money anonymously. However, that money first had to be deposited a bank and later withdrawn from that same bank. As such, the idea couldn’t evolve from theory to reality without the cooperation of a bank. No easy feat in the 80s when digital was, I guess, still a buzzword then. So it wasn’t until the mid 1990s that a US Bank, the Mark Twain bank adopted the eCash system. To do this Chaum founded the company digicash, which implemented the eCash system in collaboration with the Mark Twain bank for micro payments. According to a 1998 article by Cnet’s these micro payments ranged from 25 cents up to $10 an economy that at the time was already worth 1.8 trillion according to Visa. Through Mark Twain bank, Digicash and eCash but connected to more than 5000 customers and 300 merchants online. However Digicash’s presence in the market was short lived with Mark Twain bank, wrapping up its tests with the platform in September of 1998 and instructing all customers and merchants to clear the eCash of their hard drives and put it back into Mark Twain bank accounts and to expect a check in the mail. Different times, I guess, indeed. While digicash may have been ahead of its time, today in 2019 several major banks, governments and federal treasuries are all exploring digital currency. The People’s Bank of China is in the early stages of developing a national digital currency to complement the yuan. Facebook has led a consortium of banks as well and payment providers and tech companies to launch the Libra Foundation which is a stablecoin backed by a basket of various fiat currencies. Banking giant JP Morgan is testing a cryptocurrency for internal settlements. And even the governor of the Bank of England has suggested that some sort of digital currency could one day dethrone the US dollar as the global reserve currency. Okay, so maybe you’ve heard of this one, but it’s just an important part of Bitcoin folklore that we had to mention it. So number three, is the first ever Bitcoin transaction was to pay for pizza. In May of 2010, a hungry fellow by the name of Laszlo Hanyecz went on to the Bitcoin talk forum, in search of dinner. He offered 10,000 Bitcoin in returned for a couple of pizzas to feed him that night with the hopes he would have a bit left over in the morning. Proving bitcoins ability as a global borderless currency, a man in London took him up on the offer. The Londoner ordered two Papa John’s pizzas to Hanyecz’s home in Florida and received the 10,000 Bitcoin in return. Some reports say that the amount of Bitcoin was worth between $30 and $40 US at the time while the pizzas themselves only cost 25 bucks. Of course, since then the price of bitcoin is only gone up. Only nine months off of the delivery of the pizza Bitcoin hit parity with the US dollar. At bitcoins all time high during the mania of late 2017. The pizza would have been worth I guess, a cool or maybe hot 200 million or so. Fortunately, Hanyecz has kept a cool head about the whole thing and kept things in perspective. Speaking to the New York Times in 2013, he said “It wasn’t like bitcoins had any value back then. So the idea of trading them for a pizza was incredibly cool. No one knew was going to get so big”. And more recently, Hanyecz has embraced his role as pizza guy reenacting his famous Pizza purchase in 2018 are using the Bitcoin lightning network in an attempt to help publicize the upcoming payment network. Although this time, the pizza is only sending back 0.00649 of a Bitcoin. Bitcoin pizza Day is celebrated every year on the 22nd of May with next year’s event marking the 10 year anniversary, and even ledger created their own pizza theme wallet check this out. Pizza! Have you ever celebrated pizza day? Do you plan to let us know in the comments below. And what about the rest of the video? Did we surprise you with some of those tidbits? Let us know which ones in the comments below that really tickled your Bitcoin fancy. And make sure to like and subscribe and keep up to date with the latest cryptocurrency news guides and interviews with crypto Finder. And don’t forget, head over to our website finder.com which has hundreds of guides and reviews to help you get the most out of your cryptocurrency. Our unique exchange comparison tool lets you compare over 70 exchanges on things like fees, coins, security and more to help you make sure that you’re getting the best deal on your trades. That’s all today. We’ll see you guys next time. Yeah!

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