Martien van Steenbergen wrote:
Very interesting. Is this akin to David Chaum’s anonymous digital money? His concept makes sure money is anonymous unless it is compromised, i.e. the same money spent more than once. As soon as it’s compromised, the ‘counterfeiter’ is immediately publicly exposed.
It’s similar in that it uses digital signatures for coins, but different in the approach to privacy and preventing double-spending. The recipient of a Bitcoin payment is able to check whether it is the first spend or not, and second-spends are not accepted. There isn’t an off-line mode where double-spenders are caught and shamed after the fact, because that would require participants to have identities.
To protect privacy, key pairs are used only once, with a new one for every transaction. The owner of a coin is just whoever has its private key.
Of course, the biggest difference is the lack of a central server. That was the Achilles heel of Chaumian systems; when the central company shut down, so did the currency.
Also, in bitcoin, is there a limited supply of money (that must be managed)? Or is money created exactly at the moment of transaction?
There is a limited supply of money. Circulation will be 21,000,000 coins. Transactions only transfer ownership.
Thank you for your questions,
Satoshi