Prime Numbers
Daily Ramble
Encryption is an incredible technology that enables online privacy. But I’m guessing less than .0001% of anyone in the world understands the basic building block, or primitive, that encryption is built on — until recently, myself included. But that changed with an explanation I picked up while reading The Sovereign Individual, a book I’ve referenced in a few Rambles over the last couple of weeks. I think sharing this primitive is akin to understanding gravity is the force pulling apples to the earth.
What am I droning on about? Multiplication is easier than division. That’s it, that’s the lesson. Now hold on. Before skittering off in a tizzy about that being stupidly simple, permit me to flush this out so you see its importance too. But first, we’ve got to plumb into the world of numbers, specifically positive integers — you know, whole numbers greater than zero starting with 1, 2, 3, 4, 5… You get the drift. In this world, there are two main groups, prime integers and the rest of the integers. Prime integers are unique because they can only be divided by 1 and themselves. Let me give a few examples: 5, 11, 13, 19, 29. What isn’t a prime number is, say, 21 because it can also be divided by 3 and 7. Got it?
Ok, prime number definition out of the way, let me show you how multiplication is simpler than division. Take 2 prime numbers. Let’s use 13 and 19, and multiply them. We’re pretty reliant on calculators these days, but I’m pretty sure most of us could come up with 247 given enough pencil lead, paper, and erasers. But what if I gave you the number 551 and asked you to find the two numbers that, when multiplied, get to 551. The only way to do it would be through trial and error — taking two reasonable guesses and multiplying them together to see if the result is 551.1 That’s going to burn through a lot more dead trees and give you a headache. I give it less than 30 seconds before you reach for the calculator.
We’ve gone deep into the number forest here, but let’s pull back out of the trees to see how all this relates to encryption. There’s one other thing about prime numbers worth knowing as well: there is no formula for predicting them. They must be discovered on their own. Literally, somewhere in the world, there are computers churning away trying to find the next 600 digit prime number in the universe. So if I give you a really big number made from multiplying two primes together and told you to find the two prime numbers, it becomes exceedingly difficult to find the answer. If the answer is the key to unlocking a secret, we could call this a basic form of encryption.
Internet grade encryption is much stronger than what I’ve just described, but if you’ve understood that multiplication is easier than division, you’re ahead of most other netizens surfing the information superhighway.
Favorite Thing on the Interwebs Today
Bitcoin Price Prediction
Yesterday: $45k - $50.3k
Today: $45k - $50k
Tomorrow: $45k - $52.2k
The bulls took the ball and ran with it yesterday, pumping price from a low of $45k to just shy of $50k, ending the day up almost 10%. Today, we’ve hit indecision as the bullish drive to start the week stalls and the price consolidates. I’m convinced the dip that started last week is over and we’ve set our low at $43k, but I can see the price pulling back as far as $45k before we gain much more ground. I’m watching the $47k region closely as that’s the most likely place for an interday pullback before continuing on above $50k. All in, nothing could be more healthy for the Bitcoin bull but slow steady sideways action for a few more days. That will give a great anchor point for the market to continuing climbing the price mountain. TL;DR mainly sideways with a slight up-and-to-the-right incline.
Bitcoin Ed Bite
Q: Is Bitcoin fairly distributed?
A: Yes.
There is a thesis that says Bitcoin is something dominated by a few individuals who have cornered the market. There are whales in the space, which is defined as Bitcoin addresses holding between 1k - 5k Bitcoin. But, while it is true that whales are accumulating more Bitcoin, the number of Bitcoin addresses continues to explode as adoption occurs, and smaller holders are owning a larger share of the network than ever before. Dig into the data here.
Thanks for reading,
Kent
Got questions or a “Favorite Thing on the Interwebs”? Comment below or reply and drop me a line!
If you’re not on the email list, subscribe now — just this newsletter, no advertising.
Me? I offer personal and corporate Bitcoin Implementation Strategies: setup, investing strategy, security, tax management, and inheritance. Contact me for a free initial consult.
19 x 29 = 551