Bit Gold: Nick Szabo's Bitcoin Precursor
During 1998 Nick Szabo presented work that would make him widely known in online communities cypherpunk, Bit Gold. A digital currency that never really came into existence at all. However, the initiative spelled out many of the necessary structures that would bring the cryptocurrencies, later.
These characteristics included:
- Use of a decentralized structure.
- Clear focus on privacy.
- Use of cryptography.
- Proof of work functions.
This set of implementations worked to provide a secure, decentralized digital currency that anyone could access. This conceptually advanced ten years to the creation of the Bitcoin, although the project did not go ahead.
Bitcoin is widely recognized for solving the problem of double-spending, something that Bit Gold could never achieve. Bit Gold's proposal called for using a Byzantine method that required a quorum of network addresses instead of a quorum of computing power. Consequently, this caused the Bit Gold network to be vulnerable to Sybil attacks. Subsequently, the block confirmations of the Bitcoin project, they gave the safe solution the double expense. In this way, Bitcoin culminated, ten years later, the journey started by Nick Szabo and his proposal for Bit Gold.