Bitcoin, Blockchain, and Distributed Ledgers: Between Hype and Reality

22 Pages Posted: 31 Aug 2016 Last revised: 19 Apr 2018

See all articles by Ferdinando M. Ametrano

Ferdinando M. Ametrano

Digital Gold Institute; Università Milano-Bicocca - Department of Statistics and Quantitative Methods; Politecnico di Milano - Department of Mathematics; QuantLib

Date Written: August 30, 2016

Abstract

Bitcoin is the most successful cryptocurrency and one of the best types of private money ever. The blockchain technology underlying bitcoin is presented with the spotlight on distributed consensus, allowing for proper understanding of its peculiarities. Notarization and trust anchoring are presented as the only relevant non-monetary blockchain applications. Finally, the hype about distributed ledger technology is assessed, evaluating its actual potential and relevance: it is exposed as an evolutionary, hardly disruptive, database technology. Instead, bitcoin can be appreciated as the equivalent of gold in digital realm: as such it might play a role in shaping the future of money and our digital civilization.

Keywords: Bitcoin, Blockchain, Distributed Ledger, DLT, Cryptocurrency, Hayek Money, Digital Gold, Gold, Consensus, Distributed Consensus, Native Digital Asset

JEL Classification: A10, B00, C70, C88, E40, E41, E42, E50, E51, E52, E58, F00, F10, G21, H00, K00, N00, O00, P00, Z00

Suggested Citation

Ametrano, Ferdinando M., Bitcoin, Blockchain, and Distributed Ledgers: Between Hype and Reality (August 30, 2016). Available at SSRN: https://ssrn.com/abstract=2832249 or http://dx.doi.org/10.2139/ssrn.2832249

Ferdinando M. Ametrano (Contact Author)

Digital Gold Institute ( email )

Italy

HOME PAGE: http://dgi.io

Università Milano-Bicocca - Department of Statistics and Quantitative Methods ( email )

Milano, 20126
Italy

Politecnico di Milano - Department of Mathematics ( email )

Via Bonardi, 9
Milano, MI 20133
Italy

QuantLib ( email )

HOME PAGE: http://quantlib.org

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