Origins of Cryptocurrency

Let’s take a look at the pioneers of this technology and its history.

Before Bitcoin

The early origins of cryptocurrency dates back to the 1980’s. David Chaum created a company in the Netherlands called Digicash.

David’s concern was the lack of privacy for our online payments.

Banks accessing your payment information

Credit cards and personal information were not nearly secure enough.

So he began work on a piece of new technology. Something that could prevent any bank or government from tracking your online payments.

The technology was successfully created! Lack of adoption sadly lead to the company claiming bankruptcy in 1998.

A dead end – but not for the fundamental idea of increased privacy and security.

In that same year, Nick Szabo, a cryptographer among other things, created BitGold. This was the precursor to Bitcoin and the impending crypto frenzy…

The Birth of Bitcoin

In 2008, a paper was published by Satoshi Natomoko – an alias for an unknown person or group. This paper outlined Bitcoin in its entirety.

Satoshi's identity is unknown

That paper is available for anyone to read here.

The paper was soon followed by Bitcoin’s release to the public in 2009.

There was, however, a problem with these early technologies. It was difficult technically to see if someone had spent their money. So, in theory, it was possible to spend the same money twice.

Satoshi was the first to solve the “double-spending” problem.

Before Satoshi’s paper, forging digital currencies was a crucial problem. It was much cheaper than forging notes and coins of regular money.

Finding a solution to this was a major success for Bitcoin and its future.

In the following nine years, we have seen over 1,500 new cryptos. All of them distinct, even ones that are merely a joke!

Cryptos may have different parameters, but the building blocks remain the same. There are three pillars we can break down in order to understand cryptos. Head on over to the next section and take a look!