β€œWe trust banks with our money and electronic transactions, but they give this money back to us in the form of loans generating whole waves of credit bubbles with a low level of reserves. We are forced to trust them with our personal details, to believe they are capable of protecting us from thieves who could raid our accounts. Their huge expenses make micropayments impossible.” – Satoshi Nakamoto The aftermath of the 2008 global financial crisis is arguably the major factor that prompted the rapid research and development leading to the implementation of Bitcoin by the group with the pseudonym Satoshi Nakamoto in 2009. Bitcoin was the first peer-to-peer payment system utilizing decentralized ledger technology and cryptography for recording storage and security respectively, as well as computational proof of work for record validation and state consensus.
This innovation was swiftly followed by the creation of the Ethereum blockchain, which added the capability to not only store and transfer value on a peer-to-peer network, but also the ability to store and deploy computer programs known as smart contracts. Smart contracts open the door to vast possibilities in decentralization.
Smart contract enabled blockchain networks like Ethereum, Tron and Binance Smart Chain made it possible to develop numerous abstractions of various traditional services within a decentralized, peer-to-peer infrastructure, thus eliminating the need for trust or mediating entities, while also ensuring user security. Blockchain smart contracts also bring the added robustness and immutability of data that is guaranteed to implement desired logic rather than depend on human activities which are prone to error and corruption.
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