Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

If you ask about the history of Bitcoin or cryptocurrencies, most people’s answer may be Bitcoin, which was proposed by Satoshi Nakamoto in 2008 and then born in 2009… People but what they don’t know is that Bitcoin is a cypherpunk movement The product, which originated in the 1970s and formed in the 1990s, ushered in the modern era of personal information privacy along with the struggle with the US government around digital freedom.

While you can learn about cypherpunks by googling, unless you understand the historical context of the movement, it’s likely difficult to get a full picture of it. You need to focus your mind on the broader question, who seeded the cypherpunk movement? Where did the idea come from?

The Stories Before Bitcoin series aims to explore the technical origins and philosophies behind cryptocurrencies from a historical perspective. There are four articles in this series, focusing on cryptography, the basic mechanisms of cryptocurrencies, and the historical development of privacy philosophy. The series will unfold from the 70’s, 80’s, 90’s and 2000’s.

  • Part 1 – The 1970s: Public Key Cryptography Brings Cryptography to the Public
  • Part II – The 80’s: Decentralized Services, Anonymous Communication Networks, and the Origins of Digital Cash
  • Part 3 – The 90s: The Origins of Cypherpunk
  • Part 4 – The 00s: The Birth of Bitcoin and Related Technologies


If we want to understand cryptocurrencies and their history, where do we start?

First talk about the creation of public key cryptography in the 70s, and while you may sigh at the black and white images of the 70s as I did when I first studied cryptography, you may not realize how important this decade was.

Before the 1970s, cryptography was mainly used by the military for communication protection. Major research in cryptography is also carried out in licensed laboratories operated by intelligence agencies (GCHQ, NSA, etc.) or corporations such as IBM. At this time, the public could hardly obtain knowledge of cryptography until the publication of Open Cryptography by three cryptographers Hellman, Diffie and Merkle broke the monopoly of cryptography and also caused the first big boom in cryptography.

Definition and How Common Cryptography Works

Cryptography is the function of protecting information from interception by the enemy or people who do not have the right to obtain the information, that is, how to communicate normally in the environment where the enemy exists. It is the underlying mechanism that ensures the authenticity and integrity of information and is one of the things that make blockchain and cryptocurrencies a reality. Public key cryptography was a paradigm shift in the use of encryption and is still one of the encryption methods used by most cryptocurrency protocols.

Essentially, public key cryptography allows people to send encrypted information to a public address through an insecure channel, and only those who have access to the private key corresponding to the public address can obtain the decrypted information. The private key is also used to sign and verify the information sent to verify the legitimacy of its origin.

Through the blockchain network, one can send bitcoins to a public address and see how many bitcoins it holds, but only the owner with the corresponding private key can transact with bitcoins.

The first big craze of cryptography, how to get rid of the government’s control of cryptography knowledge?

The story begins with Hellman, an ambitious young man

Hellman grew up a nerd, his father was a physics teacher at a local high school, so he was exposed to science from an early age. He recalled: “My father had books on his shelf that I read from time to time. Including a book I still remember, Ganot’s Physics, an old physics text from the 1890s. Apparently it was an antique even for my father. Yes, but I love it. So I was interested in science, but not cryptography in particular from the beginning.”

early career

Hellman didn’t start out with cryptography, maybe he learned cryptography at some point, but it wasn’t until later that he got a lot of connections to computer science. He even said that he had already planned his future life at an early age. He earned a master’s degree in electrical engineering from Stanford University in 1967 and excelled in school and had a great time. He envisions himself getting married at 35, traveling the world and working in management in large corporations before that.

At the age of 22, in order to deepen his research in management, he chose to study his way of thinking in the study of “decision logic”, and completed his Ph.D. Unexpectedly, he got married in the first year of his Ph.D., which did not slow him down. In the second year of his Ph.D., he published his famous paper: “Learning with Finite Memory” .

So far, he has stuck to his life plan, working for IBM according to his dreams, choosing a lifestyle that allows him to travel the world and have more wealth.

Early influence of Harry Feistel and Peter Elias

Hellman went to work at IBM’s Thomas J. Watson Research Center in New York, where his work had nothing to do with cryptography. But IBM has a department focused on cryptography research. Through the cryptography research center department, he met a cryptography researcher named Horst Feistel, after which they often had dinners to discuss cryptography and some unsolved research problems. Feistel designs the Data Encryption Standard (DES) for the government. Under the introduction of Feistel, Hellman began to get in touch with cryptography, and Feistel was also one of the guides who had the greatest influence on Hellman’s early days.

When his wife gets pregnant: he begins to ponder an eternal dilemma he has to face: family and freedom? He asked himself “Do I really want to travel the world or do I want to spend more time with my family?”

Ultimately he chose family, so he went to become an assistant professor in MIT’s Department of Electrical Engineering, where he met Peter Elias, head of MIT’s electrical engineering department, another influential guide. Peter Elias collaborated with Claude Shannon, the father of information theory, to invent modern cryptography used during World War II. Hellman became good friends with Elias, which deepened his fascination with cryptography.

Start the study of cryptography

Hellman returned to Stanford in 1971, and by the end of the year he was working on cryptography. His decision to do so was unsupported by his friends and colleagues at Stanford, who were concerned about the U.S. government’s policy of blocking code-making and cracking agencies. But Hellman believes that cryptography will have significant commercial value in the future.

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

Martin Herman, Stanford University (1973)

In 1973, Hellman gave his first lecture on cryptography and published his first report on cryptography, which attracted public attention when a researcher named Whitfield Diffie contacted him.

Whitfield Diffie, a bright and boring young man

Unlike Hellman, Diffie got his first exposure to cryptography as early as 10 years old. His father was a history professor and brought back some books on cryptography from the local library. Diffie loves math but hates school, so even though everyone thinks Diffie is very smart, he never thinks of arranging his life the way his father wanted, Diffie just barely graduated.

Although he didn’t do well in school, he was smart and did well on the MIT entrance exam. He tried to teach himself how to program, but thought it was very low-level learning and boring, and he chose to spend most of his time learning mathematics.

Working on artificial intelligence and code breakers

When Diffie first graduated, the U.S. government began recruiting young people to participate in the Vietnam War, but he was not interested in the war, and in desperation, turned to software development and other “low-level” jobs. At the same time, he also started working part-time at MIT’s Project MAC’s artificial intelligence lab, which is run by two very smart people: Marvin Minsky and John McCarthy.

 Diffie had a great relationship with McCarthy and learned a lot from it. Unbeknownst to Diffie and many at the time, McCarthy was later regarded as the father of artificial intelligence, and he coined the term “AI”. McCarthy believes that every process of learning and any characteristic of intelligent organisms can in principle be precisely described, and machines can then be built to simulate this process. McCarthy is very focused on the future, and he believes that the concept of intelligence will emerge at some point in the future. Under his guidance, Diffie gained a deep understanding of networks, electronic keys and authentication, and later Diffie followed McCarthy to Stanford and joined the newly established Artificial Intelligence Laboratory (SAIL: Stanford Artifical Intelligence Laboratory).

While at Stanford, Diffie read The Codebreakers: The Story of Secret Writing by David Kahn. This book summarizes the history of cryptography from ancient Egypt to its time, profoundly influencing Diffie’s belief in privacy. He left SAIL in 1973 and continued to focus on cryptography. The following year he took part in events across the country, discussing the future of cryptography with various experts. “I’m doing what I’m good at, which is looking for rare manuscripts in the library, driving around, visiting friends in college,” he said.

In 1974, he visited the IBM Thomas J. Watson laboratory to meet with the cryptography research team. Horst Feistel, who introduced Hellman to cryptography at the time, led the team. At the time, Diffie had no access to much of the work classified by the NSA. He was later recommended to Martin Hellman, who happened to be working on a similar cryptography.

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

IBM Thomas J. Watson Lab in Yorktown Heights

Hellman meets Diffie

“Diffie showed up at my door in the fall of 1974, and I’ll never forget that day,” Hellman recalled in 2011.

Through the introduction, they agreed to meet at Hellman’s home. Diffie came in the afternoon and left at 11pm. During these hours, they discussed more and more ecstasy, from cryptography to philosophy. Finding like-minded friends is really important, Hellman says, and working in an environment that isn’t understood can be a huge burden. Before long, Diffie was working in a local research group, where he would spend more time with Hellman on cryptography.

Data Encryption Standard (DES)

In early 1975, the U.S. government developed the Data Encryption Standard, DES, the first encryption protocol approved for public and commercial use. Driven by the NSA, the financial services industry and other business sectors that require strong encryption (SIM cards, network equipment, routers, and demodulators) are adopting DES.

Prior to the publication of DES, cryptography, like items of a military nature, had to be licensed to be adopted, or to do related work. DES is the first public approval to use this technology.

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

1970s stock photos from NSA

How DES was designed

In a 1972 study by NIST, the US National Institute of Standards and Technology, the need for mass encryption ciphers was recognized. In 1973 and 1974 people began to propose to research centers across the United States to devise encryption ciphers suitable for public life. In 1974 IBM conceived an encryption cipher called Lucifer.

Lucifer was designed under the leadership of Horst Feistel, a researcher in IBM’s cryptography research department. This cipher is an improvement on a previously developed cipher, but complies with the NSA’s design requirements. After actual use by the NSA, the NSA wants to reduce the key size from 64 bits to 48 bits, which means that less processing power is required to encrypt and decrypt. After discussion, the final key size was reduced to 56 bits.

Hellman and Diffie’s Criticism of DES

Hellman and Diffie initially embraced DES with open arms because they saw it as a big step in bringing cryptography into the public eye. But they found that shortening the length of the key was very vulnerable to attacks and could not keep the information safe. What’s more, the IBM research team accused the NSA of tampering with the passwords without authorization. After the password was returned for approval by Washington, researchers found that the password had been changed.

In the 1970s, there was widespread distrust of government, and this vigilance stemmed from the control of the population by totalitarian governments before and after World War II. In 1984 there was a lot of buzz about government oversight, social control, and individual liberty, and this discussion also reflected public vigilance about the role of government. This sentiment continued into the 1960s, during which major socio-political movements took place over the Kennedy assassination, the Cuban missile crisis, and black and gay rights. This panic was exacerbated by the Watergate scandal in the 1970s, when President Nixon authorized the wiretapping of meetings at the headquarters of the DPP National Committee. For the public, their panic is slowly becoming a reality.

It is even believed that the NSA has established ways of obtaining information that are not known to the public.

Merkle, a young man who plays a key role without realizing it

Shortly after DES was released, Hellman and Diffie published a technical paper called “Multi-User Cryptographic Techniques,” and they quickly learned that Ralph Merkle, a 23-year-old computer science student from Berkeley, was also working on the problem.

Merkle’s Puzzle

Before meeting Hellman and Diffie, Merkle had been working on the concept of public key encryption, which would later become the Merkle puzzle. He stumbled upon a question while taking a computer science course: How can new secure communications be recreated when the enemy already knows all the information? He started working on this question as the subject of research for the course.

“When I think about the eavesdropper knowing everything and being eavesdropped, you can’t seem to establish security. So my first thought was, I’m going to try to prove that it’s impossible. But when I started to prove that this situation When I couldn’t establish security, I tried many times and finally found it impossible to prove it was impossible”

“Then I thought about it, since I can’t prove that you can’t do it, I’ll do it the other way around. In the process of trying to prove that it can’t be done, I’ve clearly demonstrated some of the flaws in the process. When I started When proving it could be done, I tried every way to fix the flaws, and when I figured out how to do it, it happened very quickly. I could find a way that even the enemy, the intruder, the listener knew A way to establish a secure communication route through an encryption key under the premise of everything.”

Since Merkle did not understand the history of cryptography, nor did he learn the theoretical knowledge of cryptography, he did not think this problem could not be solved. He wrote down all his thoughts and shared them at first, but they were questioned and denied by many people.

The computer security teacher, who couldn’t understand his assignment, told Merkle to stop this naive thinking. Computer science journals refused to publish his research because editors felt that his work was not in the mainstream of cryptography thought at the time.

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

The cover of the 1970s CACM edition

After a chance encounter, Merkle shared his thoughts with a computer scientist named Peter Blatman, who immediately noticed the value of his research. Merkle didn’t know that Blatman was Diffie’s friend, and while Diffie invited Blatman to a cryptography meetup at Stanford, Blatman gave a brief overview of the problem Merkle was solving.

Apparently, Diffie had been fascinated by the same problem for years, and after hearing about how a young computer science student could potentially solve it, he first denied the possibility outright, and then began to wonder about the solution. excited about the possibilities. Diffie then sent Merkle a recently submitted paper exploring the use of public key cryptography, if possible.

After reading the sent paper, Merkle sent his own. After reading it, Hellman and Diffie were deeply inspired and completely changed their research ideas. Despite Merkle’s youth and complete lack of knowledge of cryptography, his creativity has solved the problem of public key distribution. The 23-year-old has managed to achieve what many academics have been trying to achieve over the years.

But Hellman and Diffie found his solution inefficient, and with their understanding of cryptography, they quickly found a more efficient solution to the key distribution problem, and proposed a new direction for public key cryptography. Soon, their research was written into a paper called “New Directions in Cryptography”

Merkle also accepted Hellman’s invitation to go to Stanford University and work under Hellman as a doctoral student.

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

Merkel on the left, Hermann in the middle, Diffie on the right (1977)

New Directions in Cryptography

In the paper “New Directions in Cryptography,” published in November 1976, fundamental issues of cryptography, public key cryptography, and protocols for facilitating authenticated communications were discussed.

Merkle was credited for his work, but the final communication protocol was named: Diffie-Hellman key exchange. Yet despite this, Merkle was credited as one of three inventors when public-key cryptography was patented in 1977, and Diffie believed Merkle was probably the most creative character in the public-key saga.

In this article, the concepts discussed are those used to design and secure the blockchains we use today. In the end they stated one of the purposes of this paper: “to inspire others to work in this fascinating field, which is almost completely monopolized by the government – a new direction in cryptography.”

Bitcoin Prequel (1): The Legend of Public Keys in the 1970s

Hellman’s work broke the government’s grip on cryptography knowledge and gave the public the first opportunity to use strong encryption. Due to distrust of the government’s DES cipher, the techniques in the paper sparked the first major public wave of cryptography and encryption research.

It was later learned that Hellman, Diffie and Merkle were not the first to conceive of public key cryptography, a form of which was originally created and applied to communications by researchers at the British Intelligence Service (GCHQ), but remained classified , not known to the public. Imagine how different our world might be if these three never made public-key cryptography public.

The papers published by Hellman, Diffie, and Merkle succeeded in sparking a new wave of innovation. The contrast between a wave that will continue for decades while government agencies ignore their findings underscores the importance of open collaborative work in cryptography and other scientific fields.

As written at the beginning of the first line of the paper, “We stand today on the brink of a cryptographic revolution”. Merkle, a student of Hellman and Diffie, invents cryptographic hashing in the 1980s and continues to influence the development of cryptography.


The three cryptographers Hellman, Diffie, and Merkle broke down the barriers between the public and cryptography, and the cryptography known as David Chaum in the 80s will continue to build directly on their work, integrating anonymous communication, payments, and decentralization Conceptualization of requirements for services. Apparently, David Chaum’s work was only made possible by the dedication of three cryptographers in the 1970s.

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

Like (0)
Donate Buy me a coffee Buy me a coffee
Previous 2022-09-14 10:57
Next 2022-09-14 10:58

Related articles