As a thought experiment I am trying to explore the possibility of a short-term price appreciation against Bitcoin and compare this to the gold/dime index and a few other examples. In addition to the software/tools for bitcoin trading, many people have begun to talk about the possibility of a software run society if we decide to get serious with this technology. This software is called BitCoin Impact on Consensus and it is being built by a group of math and computer scientists and is being developed in conjunction with nChain, a bitcoin/blockchain technology provider and developer of the bit-coin protocol.
I can assure you, for those of us that are not “true tech geek” that it is very doable. It may even be cheaper than building the IT backbone of our country and a lot less expensive than building all the cell towers.
The idea is to use this software to help the network to efficiently transmit the transactions between nodes which will allow those nodes to keep track of the integrity of the network and improve its efficiency. And this also gives Bitcoin users the opportunity to build an off-chain tracking service to keep track of their own private keys so they can transact on the block chain as well as on the main chain.
The private key that belongs to the individual user is like any other private key in traditional banking. It is a set of numbers that control access to the funds of the person who owns it. It can be changed by the user to help protect from malicious or well intentioned people and is a way to prevent someone from just stealing funds from the account.
The public key on the other hand is what keeps track of how many bitcoins are being spent in each transaction, and the private key is like a password. This private key is like a master key, which enables people to make transactions and unlock their accounts.
The good news is that Bit Coin Impact on Consensus will allow every node to take care of it’s own identity and security through authentication, similar to a personal identification card. But also just like any other server of any type, this software can be attacked. These attacks are impossible because it is not running on a public ledger.
With Bit Coin Impact on Consensus, the hardware that these computers run on is tamper proof and can not be stolen from the computer itself. The idea is to prevent anyone from tampering with the private keys and the service itself. They are going to be able to not only monitor the transaction record but also try to authenticate the witness in order to ensure that the transaction is legitimate and not a case of double spending.
In my next article I am going to talk more about Bit Coin Impact on Consensus and the impact it could have on the bitcoin community. This technology has the potential to revolutionize the way money works and will allow the Bitcoin users to improve the way they trade and the security of their accounts at the same time.