Lesson 3

Replication and locality

Next came an angry voice—the rabbit's—"Pat, Pat! where are you?"

Quantum mechanics aside, locality is a non-issue in the physical world. The question “Where is X?” can be answered in a meaningful way, no matter if X is a person or an object. In the digital world, the question of where is already a tricky one, but not impossible to answer. Where are your emails, really? A bad answer would be “the cloud”, which is just someone else’s computer. Still, if you wanted to track down every storage device which has your emails on it you could, in theory, locate them.

With bitcoin, the question of “where” is really tricky. Where, exactly, are your bitcoins?

“I opened my eyes, looked around, and asked the inevitable, the traditional, the lamentably hackneyed postoperative question: ‘Where am l?’” Daniel Dennett

The problem is twofold: First, the distributed ledger is distributed by full replication, meaning the ledger is everywhere. Second, there are no bitcoins. Not only physically, but technically.

Bitcoin keeps track of a set of unspent transaction outputs, without ever having to refer to an entity which represents a bitcoin. The existence of a bitcoin is inferred by looking at the set of unspent transaction outputs and calling every entry with a 100 million base units a bitcoin.

“Where is it, at this moment, in transit? […] First, there are no bitcoins. There just aren’t. They don’t exist. There are ledger entries in a ledger that’s shared […] They don’t exist in any physical location. The ledger exists in every physical location, essentially. Geography doesn’t make sense here — it is not going to help you figuring out your policy here.” Peter Van Valkenburgh

So, what do you actually own when you say “I have a bitcoin” if there are no bitcoins? Well, remember all these strange words which you were forced to write down by the wallet you used? Turns out these magic words are what you own: a magic spell which can be used to add some entries to the public ledger — the keys to “move” some bitcoins. This is why, for all intents and purposes, your private keys are your bitcoins. If you think I’m making all of this up feel free to send me your private keys.

Bitcoin taught me that locality is a tricky business.

Through the Looking-Glass

Down the Rabbit Hole