Decentralization is a centuries-old topic, originally used to describe the ebb and flow of a central government’s power. In practice, decentralization is extremely difficult to achieve, and can have many downsides over centralized systems. However, decentralization can also be highly appealing due to the complete lack of centralized authority and human biases in the system.
During the “race to scale” blockchains, many of the core values of cryptocurrency have become secondary priorities. An understanding of modern crypto discourse can be enhanced through knowledge of the history and motivations of decentralization.
In the 1980s and earlier, cryptography was (and still sometimes is) considered a munition, or weapon, under US Law. This classification allowed the US National Security Agency (NSA) to impose broad restrictions on the publication of cryptographic research. In one extreme example in the late 1970s, the NSA imposed a secrecy order on a cryptographic patent application filed by George Davida, a University of Wisconsin professor.
This academic war on government censorship of cryptography came to a peak in the 80s and 90s, offering the perfect breeding ground for decentralized and uncensorable systems.
The very first attempt at anonymous digital currency came in 1989 with David Chaum’s DigiCash. It utilized public/private key cryptography to anonymize bank transfers. Unfortunately, adoption of DigiCash among banks was sparse, and the technology failed to see widespread adoption.
Things began ramping up in 1992, when a small group of computer scientists and mathematicians in San Francisco began meeting monthly at John Gilmore’s company Cygnus Solutions. The group, who named themselves the “cypherpunks,” convened to discuss modern cryptography and programming problems. The group was heavily influenced by libertarian ideals, and believed that fair money is a precedent to freedom.
As the group grew, a mailing list was created to facilitate the discussions occurring at Cygnus Solutions across the globe. In 1993, Eric Hughes published “A Cypherpunk’s Manifesto,” outlining the values and goals of this now-worldwide group of cypherpunks for the first time:
“We the Cypherpunks are dedicated to building anonymous systems. We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money.
Cypherpunks write code. We know that someone has to write software to defend privacy, and since we can’t get privacy unless we all do, we’re going to write it. We publish our code so that our fellow Cypherpunks may practice and play with it. Our code is free for all to use, worldwide. We don’t much care if you don’t approve of the software we write. We know that software can’t be destroyed and that a widely dispersed system can’t be shut down.”
Essentially, the cypherpunks were a group of individuals looking to protect the internet in its early years. Living in a world of centralized banks, governments, and companies, the cypherpunks looked to use code to ensure that the new landscape of the internet was not dominated by those same forces.
This cypherpunk mailing list birthed a variety of incredible innovations that all led up to the invention of Bitcoin. First, in 1997, Dr. Adam Back announced HashCash, an anti-spam mechanism that provided the foundation for the Proof-of-Work algorithm Bitcoin would later utilize. HashCash allowed users to prove they had spent computational power before sending an e-mail, therefore making it uneconomical to send spam.
The next year, in 1998, Wei Dai presented B-Money. B-Money theorized that the best way to keep an immutable ledger is by either a) having all network participants maintain their own copy of the ledger or b) having a small subset of network participants have a financial stake in maintaining an accurate copy of the ledger. These ideas became the foundation for Bitcoin’s system of nodes, and, later on, Proof-of-Stake.
In 2004, the late Hal Finney released Reusable Proofs of Work. RPoW allowed for the anti-spam mechanism used in HashCash to create transferable tokens. This is widely considered the first iteration of Proof-of-Work, as it directly allowed for computational power to be exchanged for transferrable tokens.
The final pre-Bitcoin attempt to create a digital currency was Nick Szabo’s BitGold, which had the exact same functional intentions as Bitcoin:
“…It would be very nice if there were a protocol whereby unforgeably costly bits could be created online with minimal dependence on trusted third parties, and then securely stored, transferred, and assayed with similar minimal trust. BitGold.”
These early ideals culminated in Bitcoin — a novel solution to the double spend problem that aggregated many of the most important cryptographic discoveries of prior decades. Anonymously published by Satoshi Nakamoto, the Bitcoin Whitepaper contained indications of Satoshi’s cypherpunk leanings; from the first line of the paper, Satoshi makes clear his intentions to eliminate “trusted third parties.” Embedded in Bitcoin’s genesis block is the headline “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.”
The values Bitcoin was created and developed with have served it well — the protocol is more resilient than ever, with only two major reorg events since launch.
Quai network’s values
While many wish to believe that the fight for decentralization has already been won, modern events prove that there is still work to be done; on August 8th, 2022, the US took drastic action in sanctioning an Ethereum-based protocol, demonstrating the importance of resilience in an adverse environment.
In order to build an increasingly decentralized world, Quai Network holds many of the same values as the early cypherpunks, prioritizing openness, decentralization, and security. These values have proven to be critical to reputable protocols’ success, and cannot be compromised.
All Quai Network code is open-source, and community contributions are encouraged. Our team strives for transparency in every aspect of development and implementation.
“We publish our code so that our fellow Cypherpunks may practice and play with it. Our code is free for all to use, worldwide.” – Eric Hughes
We believe blockchains were built to minimize central authority and spread equality among societies. With this idea rooted in everything we do, we believe Quai Network will offer one of the most competitive environments for the future of human commerce.
“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” -Satoshi Nakamoto
Security is an essential priority when working with digital currencies. Quai Network makes no compromises when it comes to the security and integrity of the network.
“The computer can be used as a tool to liberate and protect people, rather than to control them.” -Hal Finney
The concepts of trustlessness and decentralization have long and storied histories that even precede the cypherpunks.
Quai Network hopes to carry on this torch while using new and innovative technology to address some of the most prevalent barriers to widespread adoption of decentralized systems.
Join us to build a better blockchain.
Quai Network is an open-source Proof of Work blockchain network utilizing the capabilities of merged mining to increase throughput and security. Users of Quai Network will enjoy fast transaction times without compromising decentralization and security. Miners will have competitive mining opportunities across the many blockchains within the network.
Capable of thousands of transactions per second, the Quai Network is a Proof-of-Work solution to scalability that is soon to be ready for mainnet release.
Opinions, ideas, and statements shared in this update are delivered with numerous assumptions, risks, and uncertainties which are subject to change over time. There are multiple risk factors, including those related to blockchain, cryptographic systems, and technologies generally, as well Quai’s business, operations and results of operations, that could cause actual results or developments anticipated not to be realized or, even if substantially realized, to fail to achieve any or all of the benefits that could be expected therefrom. We reserve the right to unilaterally, completely, or partially change plans, expectations, and intentions stated herein at any time and for any reason, in our sole and absolute discretion, and we undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments, or otherwise. ACCORDINGLY, WE RECOMMEND THAT YOU DO NOT RELY ON, AND DO NOT MAKE ANY FINANCIAL DECISION OR INVESTMENT BASED ON, THE STATEMENTS CONTAINED IN THIS UPDATE OR ANY OF OUR UPDATES/ARTICLES — INCLUDING BUT NOT LIMITED TO ANY SELLING OR TRADING OF QUAI TOKENS, ETHER, OR ANY OTHER CRYPTOGRAPHIC OR BLOCKCHAIN TOKEN, OR THE SECURITIES OF ANY COMPANY.
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