I woke this morning with the subject thought on my mind.
Bitcoin is debt free money. All our money is debt based money. Debt based money is "born" when a loan is made drawing the money out of nothing by virtue of making it two things. A debit asset amount to one party, the bank and a credit liability amount to a a 2nd party, the receiver of the loan. As the loan is repaid both debit and credit balances are reduced until the balances are zero and the money goes back to the nothing it came from.
Bitcoin has no loan holder. It is not loan/debt money it is just money with no counter party to whom repayment is required. There will be 21 billion bitcoins produced and they will exist for ever or until lost, whichever comes first.
Since Bitcoin is debt free money it does not require double entry bookkeeping. Bitcoin and "double entry bookkeeping" was my first google of the day. Always starting the day with a question. The answer takes the next hour/hours/rest of the day. This was a good question to research: The relationship between bitcoin and double entry bookkeeping. The geniuses of thought came yesterday when it occurred to me that the Bitcoin verification model to be applied to many trust" required" relationships, maybe even be the portal entry to subsidiary "Trust Required" domains such as the home ownership model that MERs created to enable fraud.
This was the first hit on the google search on the term: Bitcoin "Double Entry Bookkeeping. It was dated June 2011. I am not the first to think about this. There were many other hits but this one is a good explanation. It recognizes the significant impact of the concept. The author extends his idea to the financial crises of 2007 and toxic asset fraud. Thinking along the same lines I am thinking.
From the link:
"It's an open question as to whether triple entry in any of its variants (Todd
Boyle's, mine or Satoshi's designs) would have changed things for the financial
crisis of 2007 +/-. I think the answer is; it was way too late
to effect it. But, it wouldn't have hurt, and with other things added
in [9], the sum would have changed things, assuming widespread implementation.
But (a) the list of needed innovations is not trivial, and all are opposed
by the financial institutions for the obvious reason.
Also, (b) it has to be said that at the bottom of the financial crisis is
securitization, which changes everything about finance [10]. And I
do mean everything :) Without understanding the role that securitization
plays, talking about triple entry or toxic assets or ratings agencies or
bad behaviour or poor people or whatever is pretty much doomed to irrelevance.
Which is how they like it!
> Today in 2011, there is still no audit that acknowledges that toxic
> assets were and are toxic.
This one winds all the way to [11] ...
> While doubtless a good monetary system should embrace all these
aspects
> of knowledge, our existing monetary system does not."
There is good discussion of the triple entry idea here in November, 2011. It is a beautiful example of crowd sourced creative brainstorming! Bitcoin discussions are like that.
Wikipedia has this short entry that was last modified Oct. 2013: Momentum accounting and triple-entry bookkeeping.
"Momentum accounting and triple-entry bookkeeping is an alternative accountancysystem developed by Yuji Ijiri and is the title of the 1989 monograph that he wrote.[1] It is a proposed alternative to double-entry bookkeeping, the method currently favored by the worldwide financial accounting system."
The search for the identity of Satoshi is a search for the geniuses of the idea as much or more than the man (woman?). Maybe one person but there is certainly a collective thought expressed in parts by many that dates back in time. Bitcoin is called a crypto currency but the idea that predates Bitcoin is Financial Cryptography. David Chaum presented the idea in 1981. Subsequently he worked on applications of the idea over a broad problem domain of Trust/Verification involving cryptography.
From the link to his name:
"In 1994, Chaum introduced the first in-person voting system, where
voters cast ballots electronically at a polling station and
cryptographically verify that the DRE did not modify their vote (or even
learn what it was).[26]"
If Chaum is attributed with the founding concept his name will stand alongside famous other famous conceptual concept thinkers. Satoshi might fade in history as an application developer.
This is all fascinating stuff I am finding!
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