Namecoin, Bitcoin, Tox; The Age of Decentralization

We are entering an era where systems no longer communicate with a central entity to interact with eachother. We've cut the middle man out of the picture. Peer-to-peer technologies are giving power to the people: there are no needs for banks, servers or even 3rd party persistent storage. It's only the beginning. The majority of the world is unaware of this advancement simply because of the lack of understanding and marketing. Hopefully I'll be able to clarify what these technologies offer.

Lets examine some technologies I find particularly useful:

Namecoin - decentralized data storage
Bitcoin - decentralized monetary system
Tox - decentralized messaging system

All of these technologies rely on public key encryption, a technology that allows secure two way communication. We won't get into this, but I strongly encourage readers to watch a video demonstrating how it works. It is a vital piece of knowledge to have in the coming days.


Name, sir?

Namecoin allows a user to store any key-value pair. A key-value pair is this: You have a key that you can call anything, lets say for example "henry". If you put "henry" into Namecoin, it will spit out a value, for example: "Hello my name is Henry and I'm 49 years old and I live in France". How Namecoin works is you pay a very small fee, less than 1 cent USD, to store a key-value pair. Where is it stored? This data is stored in the blockchain. The blockchain theoretically exists forever. So what can you do with this data that will essentially exist for an extremely long time? Here's a couple of ideas:
  • Store an entry about yourself. Prevents identity theft and impersonation since only you are able to change that entry. You can update it with current news about yourself. This provides a trustful source of information for people to look at, since only the creator of that entry can modify it.
  • Store passwords, lock combinations, and other sensitive information that you don't want lost.
  • Store short documents, such as a will.
  • Store bookmarks
People can examine the blockchain to find your data too, which also makes it a great phone book. You can easily prevent people from finding your information by encrypting it.

Bitcoins are not actual coins, ok??

Bitcoin is a virtual currency. Bitcoin is the next "cash" so to speak, but honestly better. As with Namecoin, Bitcoin relies on a technology called Blockchain. A blockchain is a giant record of every transaction that has ever taken place, and there are many copies of it. These copies are located on users' computers. The blockchain is the heart of these virtual currencies, because they provide a way to prove what amount of money someone has. Some may think that what's stopping people from rewriting transaction records? Well, it is nearly, mathematically, impossible to rewrite the blockchain at this point in Bitcoin development. This is why Bitcoin will never die, because it is a robust system. It is comparable to cash. Cash will never die because it is a robust system- no one can say that you never had that piece of cash, because you did. It was physically in your hands when you gave it over. Bitcoin is sort of like that, and that is why Bitcoin will not fail. A single person can't shutdown Bitcoin or manipulate its value. Bitcoin is still a young technology, but being technology, it can be improved to meet any and all needs. It just needs time.

So what can you do with Bitcoin?
  • Create as many "accounts" (known as wallets) as you please.
  • Zero wait to open a new wallet.
  • No need to go into a bank- everything is done on your computer.
  • Buy things online.
  • Easily send money to anyone.
  • It holds the same properties as cash.
  • Look at how your sent money flows to other's wallets.
  • It is somewhat anonymous. You do not sign up with your name. You are only identified by your wallet (which is a long piece of unique text, known as a hash).

This is Agent Smith to Agent Smith, do you read?

Tox is a newcomer to the decentralization scene, and many cryptocurrency enthusiasts may have not heard about it before. Simply put, Tox is an anonymous, secure communications application that is a replacement for Skype. With Tox, you can video or audio chat, send files, and type to friends over an encrypted connection. There is no worry about having servers hacked or having downtime- you and your friends are the servers. If one server goes down, that just means that one friend isn't online. It is nearly impossible to take down a Tox network. As with Bitcoin, the robustness that Tox offers- no, that decentralization offers, is just amazing. In order to take down the system you literally have to remove all the users. Here is a reiteration of what I've mentioned in list-form:
  • Secure communication with friends and family.
  • Replacement for Skype and other communication services.
  • Extremely robust system- cannot be taken down through one server.
  • Video, audio and text chat.

Be sure to FLOSS.

Another very important aspect to these technologies is they are all Free/Libre Open-Source Software (otherwise known as FLOSS). This means that there can be no "secret" code that someone can put in and no one would see. If someone did put in secret code, everyone would see. Being open-source makes these projects hardened (more secure) by massive communities who all have their eyes on the code. If something seems off or they find a bug, they can immediately fix it and push out an update. This also means if the people want a certain feature, they can request it or even program it themselves.

What is left to decentralize?

At first I want to say cellphone networks, but I think that's nearly impossible, because no one has access to cellphone networks like they do the internet.

Maybe... honestly, I can't think of anything. The Internet provides decentralized information access; computing grids provide decentralized CPUs to use; network file systems provide (much bigger than Namecoin) decentralized data storage, and so on (such as git/hg, mediagoblin, freenet, etc)...What is left to decentralize, really?

A better question then might be...

How come everyone has not moved to these technologies?

One main reason I suspect is because it is unknown, and people don't like the unknown. They like comfort through stability. There are many users who are consistently making an effort to attack these technologies with their words- and it works. It works because we are dealing with very young technology, and no one really knows where we'll end up. The only thing to do is to prove that these solutions work and are reliable. The only way to do that is to actually use it, and that is what these communities do. I think it's pretty clear that with every new company using one of these technologies, a "proof of concept" takes a step towards "proven by reality".

What are we leaving behind?

In my opinion we are obsoleting many everyday things: cash, credit and debit cards, cellphone networks, social media monsters like facebook and google+, usb thumb drives, and messengers like google hangouts or skype.

Is this a good thing though? That's for the people to decide. Personally I think it's interesting.

What's next?

The Internet of Things, where everything in our world is connected. I'll be walking in New York, headed for a plane to California, and pay a vending machine with Bitcoin to cook me a pizza for a certain time, with a drink on the side (yes pizza vending machines are the future!). Maybe before getting it I'll want a movie to appear on my TV screen in the hotel room I just rented that will unlock to a QR Code on my phone, while I video chat with a friend in Hong Kong. Oh, and that vending machine earlier? It knows who I am now thanks to Namecoin, and will remember what type of pizza I enjoy and exactly how I like it cooked. Damn, now that's amazing.

Hopefully the world (or even me) is still around by then!


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