Wei Dai’s b-money proposal, published in 1998, asked how people using digital pseudonyms might exchange money and enforce agreements without relying on a conventional central institution. It appears as the first reference in the Bitcoin white paper.
Two proposed arrangements
Dai described two protocols. In one, each participant keeps account records. In the other, a subset of servers maintains them, with deposits and checks intended to discourage misconduct. The proposal also discusses computational work as a basis for creating money. Read b-money.
Dai explicitly calls the first arrangement impractical because of its communications assumptions. Preserving that caveat is more informative than presenting b-money as a finished, deployed version of Bitcoin.
A connection we can document
The citation is direct evidence that Satoshi recognized Dai’s proposal as relevant prior work. It does not make the two designs interchangeable. Bitcoin’s transaction ordering, proof-of-work chain, and issuance rules need to be understood on their own terms. Compare the original paper with Dai’s proposal.
Read the predecessors alongside the result
A useful question for the reader is: which problems are being solved, and which assumptions remain? Comparing b-money with Nick Szabo’s bit gold and Bitcoin helps separate the ambition of distributed money from the mechanisms proposed to make it work.