Slashdot Mirror
Ask Slashdot: Time To Get Into Crypto-currency? If So, Which?
Qbertino writes: With the ever-looming cyberpunk future in close proximity, I'm starting to wonder if it isn't time to get myself familiar with crypto currency as a means of trade. Bitcoin is all the hype, but the blockchain has flaws, in that it isn't as anonymous as one would hope for — you can track past transactions. Rumors of Bitcoin showing cracks are popping up and also there are quite a few alternatives out there. So I have some questions: Is getting into dealing with crypto currency worthwhile already? Is Bitcoin the way to go, or will it falter under wide use / become easily trackable once NSA and the likes adapt their systems to doing exactly that? What digital currency has the technical and mind-share potential to supersede bitcoin? Are there feasible cryptocurrencies that have the upsides of Bitcoin (such as a mathematical limit to their amount) but are fully anonymous in transactions? What do the economists and digi-currency nerds here have to contribute on that? What are your experiences with handling and holding cryptocurrency? And does Bitcoin own the market or is it still flexible enough for an technology upgrade?
With the ever-looming cyberpunk future in close proximity
This is what happens when slashdot is your only source of news and you frequent it too often.
Collect real currency. Coins. Polish them. Rub them against your manhood. Push them up your back passage. Love money. It's more rewarding.
Now I know why my mother used to say "wash your hands after touching money, you don't know where it's been".
> Bitcoin is all the hype, but the blockchain has flaws, in that it isn't as anonymous as one would hope for — you can track past transactions.
Bitcoin transactions record sending and receiving addresses, and the amount sent, and that's it. Privacy depends on how careful you are outside the transaction itself. For example, if you buy something physical online, and give a delivery name and address, the store knows who those bitcoins came from. But compared to a credit card or paper check, which have your name printed on them, bitcoin transactions have the *possibility* of privacy. Cash is no longer anonymous, by the way. Banks and ATMs can scan serial numbers when cash goes out and comes in. Depending how many hand-to-hand transactions happen in between, they can figure out what you were doing.
> Rumors of Bitcoin showing cracks are popping up and also there are quite a few alternatives out there.
The Bitcoin Network is still running fine. They are getting close to a limit in the code originally intended to stop spam transactions. That limits the size of "blocks" of transactions to 1 MB. The current arguments are over how and when to raise that cap. A majority of the network has to upgrade to raise the limit. Yes, there are lots of alternatives, because all it takes is to fork the code and slap a new name on it (it's open source). But as this table ( http://coinmarketcap.com/ ) shows, Bitcoin is 7/8 of the market, and only three others have significant market capitalization and trading volume. Building a network of users, apps, etc. for an ecosystem is a lot harder than releasing a new cryptocoin.
> Is getting into dealing with crypto currency worthwhile already?
It was for me, but I started in mid-2011 (from an article on Slashdot, in fact). If it is worthwhile for *you* depends on a lot of things. If you send money to family in another country, or international wire transfers, it may be very worthwhile, because of the very high fees from the other methods. If you are an average US consumer with credit and debit cards and want to shop on Amazon, not so much.
> become easily trackable once NSA and the likes adapt their systems to doing exactly that?
The NSA can download a copy of the blockchain, just like everyone else. What they have, that the rest of us don't, is all the other data collection that can correlate a Bitcoin transaction to a person or place. Like if you are using a smartphone app to send bitcoins, they know who owns the phone and where you were at the time
> What digital currency has the technical and mind-share potential to supersede bitcoin?
What social network is going to replace MySpace? :-). What OS is going to replace Windows? Predicting the future is hard, especially before it happens
> Are there feasible cryptocurrencies that have the upsides of Bitcoin (such as a mathematical limit to their amount) but are fully anonymous in transactions?
Bitcoin can be anonymous, but you have to use it properly for that to happen. As I said above, data leakage *around* a transaction is how you de-anonymize it. The same would be true of alt-coins (the general name for cryptocurrencies besides Bitcoin). If you use them to buy something, the seller may leak your info.
> What do the economists and digi-currency nerds here have to contribute on that?
Economists in general don't have the software chops to understand how cryptocurrencies work, and have religious beliefs on how economies and money *should* work. Not all of them, but a lot of them. My own opinion is bitcoin is the most developed cryptocurrency, with the most users, apps, mining hardware, etc. The direction in the future won't be replacing bitcoin with another coin, but building layers on top of Bitcoin. It's a communication protocol for scriptable transaction messages, and people have barely figured out how to make use of that. As such, it is similar to the IP protocol stack.
Which is why I've paid for cannabis[0], domainnames, VPSs and bountysources with it?
It was really volatile until people figured out what it was but it's no worse or better than any other currency. Try owning any random currency during government unrest. It's "collapsed" to all of ~$350. Which is still worth more than your Zimbabwe dollars.
It's still easier to carry $50 of BTC on my phone than $50 cash and if I lose my phone I can always just go grab the keys and send it to another wallet before the idiot that stole my phone figures out BTC. I can also 'back up' my money to multiple places. I have a few PGP encrypted wallets sitting on VPSes should my house burn down.
Coinbase has 2 factor auth for everything. I trust it much more than my bank that still uses 1 factor auth. It also looks like it was designed after the year 2010.
Log in to coin base? 2 factor. Send money over $X amount? 2 factor. Make any account changes? 2 factor.
Personally BitCoin is a bit too 'heavy'. The full chain is going on 100GB now and in my mind it's the crypto currency equivalent of Gold. Good for long term, but a PITA to deal with daily. I think OP has a valid question and I'd like to know if there are any other ones out there.
Personally I wouldn't care if Mastercard or Visa backed a currency as long as it could do faster transactions.
For a 'tech' website Slashdot seems to have its fair share of luddites. "NEW CURRENCY, PYRAMID SCHEME". Teach the kids to code. "IT'LL NEVER WORK, EVEN THOUGH I'VE BEEN CODING SINCE I WAS 4".
Calm down and evaluate it on a technical basis and it's not that bad, the 'easy' money is long gone but I never intended to get rich on BTC. It's just another currency like carrying around Euro or Pesos, except this one I can backup on a piece of paper, to a flash drive, or elsewhere.
There are also a lot of newer readers here. Reddit is bleeding users that want real discussion. Twitter is imploding and a cesspool. Even with everything slashdot has been through it's discussions on some topics are still better than anywhere else I've found on the web, StackExchange included.
If you're really convinced that the whole thing is a scam put up some numbers and reasoning other than just dismissing it as a pyramid scheme.
[0]. The dark net is kind of interesting, about where the interwebs were in the late 90s. no flash and javascript piazza. At times it actually feels faster than the normal web because of all of that.