What Is Peer-To-Peer (P2P)?
Peer-to-Peer (P2P) is a distributed communication model where nodes or peers communicate with each other directly without the use of a central server or third party.
A distributed network architecture may be referred to as P2P only if peers share a portion of their hardware resources such as processing power.[1]Rüdiger Schollmeier, Technische Universität – A Definition of Peer-to-Peer Networking for the Classification of Peer-to-Peer Architectures and Applications These shared resources are vital to the network functioning due to the vacancy of a central entity to do so. The diverse resources available are then aggregated to accomplish a greater task within the network.[2]H. M. N. Dilum Bandara and Anura P. Jayasumana, Colorado State University – Collaborative Applications over Peer-to-Peer Systems – Challenges and Solutions
All peers within the network retain the same status and privilege, as anyone can be a part of the system as long as they have a copy of the protocol and can access the internet. Peers within the network are both providers and consumers of the resources available on the network.
A Peer-To-Peer Electronic Cash System
P2P technology is the basis of blockchain technology and there is no better example than Bitcoins whitepaper, “Bitcoin: A Peer-to-Peer Electronic Cash System“.
Bitcoin’s thesis is to allow online payments to be sent directly from one party to another without the use of a financial intermediary, this is done by the transfer of Bitcoin from one wallet to another, not passing through any third party on the way. Such is the same for all cryptocurrencies.
The absence of a centralized entity controlling the project or even a real identity behind it makes for a true peer-to-peer system.
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