What the Bitcoin White Paper Misses – Bitcoin Magazine
This is an opinion piece by Shinobi, a self-taught Bitcoin educator and tech-savvy Bitcoin podcast host.
The Bitcoin White Paper is one of the most important documents written this century to anyone reading this. Every Halloween, somewhere in the back of our minds, “this is when it happened” invades our consciousness. It really was one of those random, innocent moments of that time that just burst in out of nowhere that would radically change the dynamics of the world. It laid out the framework for an idea that even today, with a ridiculously small size and importance in the world and its economy, has still had a massively outsized effect on this planet.
It was harmlessly dropped on the cryptography mailing list at 18:10 UTC with the paper abstract and this small text:
I have been working on a new electronic cash system that is completely peer-to-peer, with no trusted third party.
The paper is available at:
http://www.bitcoin.org/bitcoin.pdf
The most important features:
Double spending is prevented with a peer-to-peer network.
No coin or other trusted parties.
Participants can be anonymous.
New coins are created from Hashcash-style proof-of-work.
The proof of work for new coin generation also drives the network to prevent double spending.
Only a relatively small handful of people saw this post or engaged with it, but that’s where the first domino fell and the cascade of all comers began. In that regard, it is a key piece of history that should be remembered and valued as such. But in the grand scheme of things, the White Paper is not what many people in this room have made it out to be. It is not a specification of the Bitcoin protocol. That is not the definition of Bitcoin. The white paper did not actually create the Bitcoin network. The code and client that Satoshi Nakamoto released about two months later did.
What the Bitcoin White Paper left out
The white paper is only a description of high-level concepts. All it really does is review, in a very simplistic way, the fact that a solution to the problem of double spending was found. There’s no deep analysis of the overall protocol and network structure, it’s not a comprehensive definition of the protocol itself, it’s essentially just the academic equivalent of “Hey, I had this idea, check it out.” So much of the protocol itself is not even mentioned in the paper.
For example, part two of the paper states:
“We define an electronic coin as a chain of digital signatures. Each owner transfers the coin to the next by digitally signing a hash of the previous transaction and the public key of the next owner and adding these to the end of the coin. A payee can verify the signatures for to verify the chain of ownership.”
It was an absurdly complicated script system used to lock and unlock coins in the process of trading them. That would allow the construction of scripts, or “predicates” (an equation that evaluates to true or false) as Nakamoto referred to them here, that could require all sorts of arbitrary conditions to be met in order to use a coin. It is entirely possible, as has been done in the past, to create a coin that requires no digital signature at all to use.
The way the white paper describes what a “coin” is in the second part is a huge oversimplification that ignores all the possible functionality of multisignatures, locks, hash locks and everything that can be built (and has been built) using these primitives. Because the point of the white paper was not to explicitly define the details of the protocol, it simply sought to get across the basic concept of being able to securely control a coin without relying on a central authority. The use of signatures, and all the other arbitrary conditions that can be created with scripts, can all be publicly verified by anyone scanning the chain.
In the fourth part, on proof of work, nothing is mentioned in relation to factual details in relation to the measure of difficulty. The difficulty period is not defined, the number of blocks on average, nothing. In the incentive section that discusses the block reward subsidy and the ability to move from new coins being issued to pure transaction fees, no total supply is discussed, no rate to dictate the slowdown of new issuance, no timetable for it – all of these things are completely undefined in the white paper. Because it is not a definition of Bitcoin. It is a purely conceptual introduction at a very high level to the most important things that make the system actually viable.
Talked about but never implemented
Some things in the white paper that were explicitly talked about were never implemented in the real system. In discussing Simplified Payment Verification (SPV) in section eight of the article, Nakamoto discussed the potential for malicious miners to fabricate invalid payments if they were able to overpower the rest of the network and trick SPV clients into accepting invalid transactions. This is possible because all they use to confirm something is a blockhead and the Merkle tree path including the individual transaction, they see nothing from the rest of the block. Nakamoto proposed the possibility of nodes on the network sending “alerts” to SPV clients whenever they encounter an invalid block, allowing them to download and verify it. This was never built out because it is not possible to validate a block without validating the block before it, and so on and so on back to genesis. It was literally impossible to do.
Now the door may be opened in the future for such things by zero proof of knowledge, but the vague idea that is proposed to solve a big problem here in the white paper has not yet been implemented. Nakamoto speculated about the possibility of zero-knowledge proofs in Bitcoin, but they were much less developed of a technology then and somewhat clearly above Nakamoto’s level in terms of deep understanding.
How to think about the Bitcoin White Paper today
Looking at all these examples, we can see that there were very critical and defining aspects of the Bitcoin protocol launched in January 2009 that were not even mentioned in the paper at all. We can also see that a very critical security protection proposed in the paper is still not implemented in any Bitcoin software to this day.
The White Paper is a very important document in historical terms, and a very important document in conveying the most fundamental concepts underlying the design of Bitcoin as an abstract system, but in terms of the actual specific technical details of the protocol and network , it is essentially irrelevant.
This was the mistake of many Bitcoiners who have drifted away from the system in favor of broken protocols like Bitcoin Cash or Bitcoin Satoshi’s Vision – they treated the white paper as a protocol specification. It is not. It never was.
This is a guest post by Shinobi. Opinions expressed are entirely their own and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
