Indicates he's a good big-scale thinker:
I realised DigiCash’s vision was too narrow, and all of finance (shares, bonds, derivatives) could be implemented using this technology.On mixing in the 1990's
This is what Gary and I used in the 90s, we created a pseudonymous system whereby if you wanted to preserve some sense of privacy you would swap coins back and forth to obfuscate the trail.Was aware of how wallets would need to function in order to allow mixing
Firstly the money was tranched into coins, denominated as a number which didn’t change. Eg if you want to send 9.99, you needed an exact set of coins to match. So you can track those specific numbers and see who is moving money around.
Secondly people weren’t really set up to hold their coins on their own wallets because of the difficulties with backups, so people would just use an account at the mint, and withdraw when they want to send to a merchant, then the merchant would cash them in.
So there’s a time and coin based tracking mechanism. You needed a lot of traffic before you could get privacy.He was mixing int he 1990's:
The bitcoin arrangement is that you use a pseudonymous key, and if you want to spread your coins around, you write them to different keys which you control, creating a graph of confusion and security by obscurity. This is what Gary and I used in the 90s, we created a pseudonymous system whereby if you wanted to preserve some sense of privacy you would swap coins back and forth to obfuscate the trail.Was aware of how companies fail. He knew from the beginning Ethereum would have a problem like the DOA.(End of article goes more into how smart contract coin will morph into a useful Ricardian contract, and how Ethereum will continue to have problems from lack of understanding basic problems)
-- interviewer: You mentioned 100 companies working on the problem, making the same mistakes. Do you see the same mistakes being made again today by all the crypto companies?
...The smarter companies quickly discover they’re always losing money due to hacks, crashes, failures, and bugs. They then do more research and discover the solution is to implement double entry accounting. Ethereum is going through this right now.Other:
we were in the formative period trying to solve for money. If you can’t get money working, can you get anything else going? That was my field. Everyone could understand cash, so we wanted to get that working first.
Most people think cryptographers and programmers are interchangeable. They are not! They are very different fields and very few people understand both. .. unless you have seriously good engineers putting together seriously complicated code you’re going to end up with a mess. That’s what happened with a lot of systems, eg e-gold which I was partially involved in.Discovered that money is a simple smart contract
Once I understood this [what a bond is...a contract], I asked myself what a contract was, and that took me on a different journey. I learnt that there were two parties, an offer and acceptance, some clauses, terms and conditions. Goods go one way; value goes the other way.
The interesting thing is that my answer to how I issue bonds on the net is exactly the same as how I issue a contract onto the net.
And once I’ve worked out how to issue a contract onto the net, I can construct anything else including money! So when we started, we thought we’d need money separate from bonds, but actually we just needed a contract system, with a contract for money and a contract for bonds.
This was a huge discovery which most people haven’t made yet.Realized hashing was needed to connect the fact of a contract to accounting
So we need a way to link the contract claim to the accounting. That’s where cryptography came in. We took the contract document and hashed it (we were using SHA-1) and the hash became the unit which was accounted for. The accounting system just kept the numbers good and balanced and fair, and every time it moved a number around, it would move a number of these hashes. So we elegantly sliced the world of law from the world of accounting, using a hash in the middle!Built servers that tried to remove centralization problem
There can be only oneYour pseudonym would digitally sign the request, creating the authorisation to move the money. That meant the issuer couldn’t just wave their hands and change the numbers. ... Most of the issuance servers I built revolved around that
So Bitcoin is the exception that proves the rule that you need a contract if you’re issuing something. Or you’re issuing something without a contract, there can only be one in the space.Consensus is 3rd column of triple entry ledger
From this concept came the notion of triple entry. The receipt itself was shared between the payer, payee, and the issuance server. If you only had 2 parties and one of them lost their copy, then there’s potential for abuse: you need all 3. This is how we established “consensus” (in today’s terms) about a single transaction, and about a set of transactions....Later in 2004 I figured that this actually looked different to double entry – it turned out to be triple entry...So I wrote this paper and sent it to Todd Boyle who said that he’d invented this ages agoHow the Satoshi team began in engineering BTC:
When Satoshi (the team) were building Bitcoin, they looked at why the systems had failed – they found that it was because behind the contract there was an issuer, something to be attacked.....The problem was there was an issuer, there was a contract. Satoshi figured out there needed to be an instrument without a contract, without an issuer, so after lots of thinking they came up with the notion where they just invent the number – they swept away the law and just kept the accounting, which just dealt with numbers.