I've written an introduction to the meat-and-potatoes of Bitcoin.
It's proving to be pretty effective in creating "oooooh - I get it!" moments. Please tell me what you think, and please test it however and on whoever you like.
It's called The Real Magic of Bitcoin and it starts like this:
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http://stillgoing.net/majc/images/bitcoin_hat.png Forget everything you've heard. Bitcoin is complicated like magic is complicated. It's not. But things are told to you in an obscure way, amidst a lot of distracting nonsense, which leaves you bewildered. The magician does it on purpose, of course, whereas Bitcoin just isn't explained very well, and the theatrics which happen around it are highly magnetic.
So where's the sleight of hand – what are we missing?
Where we really need to look, first and core-most, is here: When you hand over a quarter to someone in the street, the coin moves from one person to another, and everyone keeps walking. Bitcoin doesn't work that way. You do not “transfer one bitcoin” from one person to another. Bitcoins don't move.
What happens instead?
When you transact in bitcoin, what moves from one person to another – what changes hands – is ownership of the bitcoin. You sign over your ownership of one bitcoin to someone else, the bitcoin stays put, and everyone keeps walking. Do you see how that's different? The money in this situation – the agreed, accepted store of value that people exchange – is bitcoin-ownership, not the bitcoin itself.
Nifty trick? Yes. Complicated? No.
It's a subtle shift in technique which achieves exactly the same result: “This doesn't belong to me any more, it belongs to you”. And, like a magic trick, subtle shifts in technique can make otherwise impossible things possible.
The Bitcoin way of making transactions – with its subtly different technique – opens up some very important new possibilities (and it also improves on many old ones). And that is Bitcoin's value. That is why Bitcoin means something. That is why Bitcoin is worth something.
We'll get to what the newly-possible things are in a minute, and why they matter, but when you see some pretty smart people getting so pumped about bitcoin, these technological advances are the reason. They are the real magic of bitcoin.
And they regularly get lost amidst a lot of distracting nonsense.
http://stillgoing.net/majc/images/glider_trans.png
First, a little bit more of how it works…
Take a second to see the difference in technique clearly (between the quarter and the bitcoin), because from here we're properly set up to understand Bitcoin. From here, what might seem tricky actually starts making sense. Like the public, mega-shared ledger, for example.
When you sign over your ownership of one bitcoin to someone else, this internet-wide ledger is where you sign.
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continues here: http://stillgoing.net/majc/2014/07/the-real-magic-of-bitcoin/.
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Thank you to everyone who reads it.
Let me know if it works.
