Experiments · Nobody Owns Money · Chapter 1
The double spending problem: one coin, two sellers
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About this experiment
Once money became a record in a computer, the record turned out to have an awkward property: it can be copied. A song or a book is forwarded endlessly; the sender keeps it, and the recipient gets one exactly like it. If a coin is a file, its owner can send the same file to two sellers and pay twice.
Programmers called this the double spending problem, and for years it had one solution. Someone in the middle keeps the shared list and crosses out a spent coin before accepting it from the next person. That is the same bank, only in a computer, and the same bank can freeze your line.
Below are both ways. First the coin as a file, which goes to both sellers. Then the bookkeeper, who crosses the coin out and can freeze the account. How to do without the bookkeeper is what Satoshi Nakamoto published in 2008.
From the book
Nobody Owns Money · Chapter 1
A Stone at the Bottom of the Sea
Programmers called this the double-spending problem, and for many years it had one and only one solution. You need someone in the middle who keeps a shared list and crosses out a spent coin before accepting it from the next person. That is, the same bank, only in a computer. Every digital currency that tried to do without a central bookkeeper ran into this wall, and every one that accepted him became yet another bank, answered for by the very same people one had wanted to get away from.