Bitcoin White Paper: 2. Transactions

Too Long; Didn't Read

We define an electronic coin as a chain of digital signatures. We need a way for the payee to know that the previous owners did not sign any earlier transactions. For our purposes, the earliest transaction is the one that counts, so we don't care about later attempts to double-spend. The only way to confirm the absence of a transaction is to be aware of all transactions. To accomplish this without a trusted party, transactions must bepublicly announced [1], and we need a system for participants to agree on a single history.