Bitcoin for Nonmathematicians:. Slava Gomzin

Point Addition: C = A + B Point Doubling: C = A + A = 2A Now Let’s Play with the Numbers Encryption Decryption Bonus Chapter Experimenting with the Code Modulus Modular Inversion Representing the Points Point Doubling Point Addition Point Multiplication Calculating the Public Key Encryption Decryption Part II Summary

       References

       Index

      Foreword

      by Doug McClellan

      I’m a numismatist, which is a fancy word for a coin collector. I’m also a software developer for electronic funds transfer (EFT) systems by profession and, like most readers here, also an investor.

      So when Slava told me he was writing a book about bitcoins, I knew I wanted to read it because it was an area I’ve always had an interest in from the three perspectives I’ve just mentioned. Bitcoins mainly tie into the future of electronic payments, but also have been used as an investment vehicle and could very well have an impact on the future of numismatics.

      I’ve been collecting coins ever since I was a kid, and started building my collection over 45 years ago with a Lincoln Cent album. For the last 25 years I’ve developed software for the retail merchant industry, and specialized in EFT systems for the convenience store market segment for the last 17 years. When you buy a soda at the convenience store or swipe your card at the pump, there is software needed to process your transaction electronically.

      I will expand more on that in a bit, but first I want to introduce you to the author, Slava Gomzin. For those of you who are not familiar with his work from his blog at www.gomzin.com or from the other books he has published in the area of cybersecurity, such as Hacking Point of Sale, along with his Application Security and Cyber Privacy book series titles for electronic data security, I think you will join me in appreciating his insight in this area.

      I met Slava in 1999 when we worked together to create an EFT software system through our mutual employer. Slava had emigrated from Russia to Israel when President Reagan had challenged the Russian government to allow its citizens to have more freedom in their lives. Slava was one of those people who saw the opportunity and had the courage to build a new life in a foreign country. He moved his family to Israel, where he found employment using his computer programming skills. Later he again utilized his pioneer spirit when he moved with his wife and children to America, the true land of opportunity.

      Slava has proven that hard work and dedication, along with natural talent and abilities, will flourish in a free society. Slava was our team leader in the EFT development group during a time when our company was rapidly expanding here in the United States. While managing multiple development projects with different EFT networks, he had taken an interest in cyber security, which was in its infancy at the time. He read, studied, and attended courses in cybersecurity, and has earned many certifications over the years. Slava also served on the PCI standards committee when the early standards were being developed. So, as you can see, Slava knows cybersecurity. In fact, I would say he is an expert in the field.

      In this book, Slava brings the reader along on a journey from the origins of money and electronic payments and into the implementation of bitcoins as a cybercurrency.

      I find the term bitcoin to be rather clever as a name. It is not, of course, a coin in the physical sense, but an electronic implementation of money represented by bits, the electronic 1s and 0s that computers use to store data. The origin of bitcoin is rather mysterious, as you will learn in the book.

      Using the standard economic concepts that the value of anything is what a willing buyer will pay a willing seller in an arm’s length transaction, cost is what you give up to get something else, and money is a standardization of trade units that allow for marketplace transactions to occur, bitcoins are an attempt to create a new type of currency that is separate from a central system (such as government-issued currency) and that can also be deployed as an electronic payment system.

      Throughout