Dr. Craig Wright recently released a blog post explaining the first sentence of the Bitcoin white paper in detail. It’s almost 3,000 words dedicated to explaining key and basic concepts about Bitcoin that are still misunderstood. You can read it here.
Dr. Wright opens the blog by saying that he is frustrated by the lack of understanding of what he considers basic terms and concepts in the white paper. So, in this post, he will explain the first sentence of his white paper in detail.
Direct payments from one party to another
A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.
The very first sentence of the Bitcoin white paper notes that payments can be sent directly from one party to another. This does not say it’s done by sending it through multiple hops. If you send a payment to a node and someone collects from that node, then the node is an intermediary.
In Dr. Wright’s example, Alice wants to pay Bob, so she directly gives Bob a transaction in exchange for goods and services. On the other hand, Bob wants to make sure she didn’t double-spend the transaction. For Bob to be sure the transaction is valid, he has to register ownership of the transaction with the nodes. The tokens Alice sent him stay with Bob, and the transaction record stays on the blockchain.
Elaborating, Dr. Wright explains that, provided Alice has not cheated, Bob will have…
