I anticipate there will never be more than 100K nodes, probably less. It will reach an equilibrium where it's not worth it for more nodes to join in. The rest will be lightweight clients, which could be millions.

The proof-of-work also solves the problem of determining representation in majority decision making. If the majority were based on one-IP-address-one-vote, it could be subverted by anyone able to allocate many IPs. Proof-of-work is essentially one-CPU-one-vote. The majority decision is represented by the longest chain, which has the greatest proof-of-work effort invested in it. If a majority of CPU power is controlled by honest nodes, the honest chain will grow the fastest and outpace any competing chains. To modify a past block, an attacker would have to redo the proof-of-work of the block and all blocks after it and then catch up with and surpass the work of the honest nodes. We will show later that the probability of a slower attacker catching up diminishes exponentially as subsequent blocks are added.

Announcing version 0.3 of Bitcoin, the P2P cryptocurrency! Bitcoin is a digital currency using cryptography and a distributed network to replace the need for a trusted central server. Escape the arbitrary inflation risk of centrally managed currencies! Bitcoin's total circulation is limited to 21 million coins. The coins are gradually released to the network's nodes based on the CPU power they contribute, so you can get a share of them by contributing your idle CPU time.

The average total coins generated across the network per day stays the same. Faster machines just get a larger share than slower machines. If everyone bought faster machines, they wouldn't get more coins than before.

Bitcoin isn't currently practical for very small micropayments. Not for things like pay per search or per page view without an aggregating mechanism, not things needing to pay less than 0.01. The dust spam limit is a first try at intentionally trying to prevent overly small micropayments like that.
Bitcoin is practical for smaller transactions than are practical with existing payment methods. Small enough to include what you might call the top of the micropayment range. But it doesn't claim to be practical for arbitrarily small micropayments.

The target time between blocks will probably be 10 minutes. Every block includes its creation time. If the time is off by more than 36 hours, other nodes won't work on it. If the timespan over the last 6*24*30 blocks is less than 15 days, blocks are being generated too fast and the proof-of-work difficulty doubles. Everyone does the same calculation with the same chain data, so they all get the same result at the same link in the chain.

It is a global distributed database, with additions to the database by consent of the majority, based on a set of rules they follow:

- Whenever someone finds proof-of-work to generate a block, they get some new coins
- The proof-of-work difficulty is adjusted every two weeks to target an average of 6 blocks per hour (for the whole network)
- The coins given per block is cut in half every 4 years

We're not "on the lookout" for double spends to sound the alarm and catch the cheater. We merely adjudicate which one of the spends is valid. Receivers of transactions must wait a few blocks to make sure that resolution has had time to complete. Would be cheaters can try and simultaneously double-spend all they want, and all they accomplish is that within a few blocks, one of the spends becomes valid and the others become invalid. Any later double-spends are immediately rejected once there's already a spend in the main chain.

Think of it as a cooperative effort to make a chain. When you add a link, you must first find the current end of the chain. If you were to locate the last link, then go off for an hour and forge your link, come back and link it to the link that was the end an hour ago, others may have added several links since then and they're not going to want to use your link that now branches off the middle.

The steps to run the network are as follows:

1. New transactions are broadcast to all nodes.
2. Each node collects new transactions into a block.
3. Each node works on finding a difficult proof-of-work for its block.
4. When a node finds a proof-of-work, it broadcasts the block to all nodes.
5. Nodes accept the block only if all transactions in it are valid and not already spent.
6. Nodes express their acceptance of the block by working on creating the next block in the chain, using the hash of the accepted block as the previous hash.

It is a global distributed database, with additions to the database by consent of the majority, based on a set of rules they follow:

- Whenever someone finds proof-of-work to generate a block, they get some new coins
- The proof-of-work difficulty is adjusted every two weeks to target an average of 6 blocks per hour (for the whole network)
- The coins given per block is cut in half every 4 years

At equilibrium size, many nodes will be server farms with one or two network nodes that feed the rest of the farm over a LAN.