Bitcoin burst onto the scene in 2009 "sort of out of nowhere," says University of Maryland, College Park professor Jonathan Katz, who notes the technology was quickly adopted by people before any serious analysis was done. "It mushroomed into this thing where thousands of people are using it and still people don't understand the precise security properties of it," Katz says.
However, the U.S. National Science Foundation now is funding research at several universities, including the University of Maryland, into Bitcoin and other crypto-currencies to learn more about the technology.
After a surge of interest in the crypto-currency during 2013, the use of Bitcoin and its value have largely leveled off, but even the dedicated community built around Bitcoin is struggling to understand it. For example, there currently is a controversy over the size of blocks, the pieces of data that record Bitcoin transactions and are central to the crypto-currency's security.
Katz says University of Maryland researchers are examining the security mechanisms that underlie Bitcoin. They also plan to examine how Bitcoin's transaction technology could be incorporated into computer-coded contracts, which could have applications in peer-to-peer micropayments and hedging financial portfolios.
"We want to allow people to understand what Bitcoin provides, and it's up to people's own personal preferences whether they choose to use it," Katz says.
From The Baltimore Sun
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