Why Blockchain Was First Implemented in Bitcoin

Why Blockchain Was First Implemented in Bitcoin

An audience asked me this question during my session in IDSECCONF 2017. Knowing how good blockchain is, why was it first implemented in finance area (which is Bitcoin, a revolutionary e-cash system)?

This is a very good question, and honestly, I do not have the exact answer. Satoshi Nakamoto was working on Bitcoin and the idea of blockchain might seem to fit the function, and there are also several other ideas that can be included in the solution. How he got the idea of blockchain, I do not think I can answer that (although I have not yet tried to find the answer), but as per my knowledge, the blockchain implemented in Bitcoin might be the first of its kind.

Satoshi might get his “flash of genius”, a lifetime moment which can change the humanity. He solved the seemingly hard problem: removing the need of a central authority to control the e-cash system so that the payments created in the system cannot be tracked down by the authority, thus anyone can buy anything they want (illicit products included). Blockchain is actually a simple solution which requires existing cryptographic primitives such as hash functions and public key cryptography which have been mature technologies for years.

The next possible answer is that the financial system must be strong enough to survive in a rough environment. As you might realize that banks suffer cyber attacks on a daily basis; they spent millions of dollars to establish state-of-the-art security systems to mitigate attacks from hackers hunting for money. These hackers are highly motivated; a success means a financial guarantee for years to come. Regular system does not really need a protection, especially when the information is free to access. Only those systems with sensitive data (high availability and high integrity, not sure about confidentiality) worth implemented using the blockchain.

The good thing about blockchain being first implemented in the financial field is that it has been tested and designed such that it can survive in a rough condition where trust does not exist. Of course this claim needs to be retested since we have already spotted blockchain’s weaknesses inside Bitcoin. While blockchain survives as a financial industry propeller, it should be an easy solution to other areas.

Leave a Reply

Your email address will not be published. Required fields are marked *