Slashdot Mirror
Bank of England Looks Into 'Centralized' Bitcoin Alternative, RSCoin (thestack.com)
An anonymous reader writes: The Bank of England is working with researchers at University College London to design a Bitcoin clone of its own that can be centrally controlled. It was recently found that the UK's central bank had reached out to university researchers to help it create a cryptographically secure digital currency. The resulting system has now been revealed, and is named RSCoin. The system employs cryptography to obviate counterfeiting and tampering. Unlike other mechanisms, the digital ledger used by the new cryptocurrency is handled exclusively by a central body and will only be made accessible to users in possession of a specific encryption key. Its developers explained that an RSCoin ledger could be published publicly by a central bank, and added that the system's design would also allow a central bank to make transactions entirely, or partially, anonymous.
Is the sound that plays perpetually there.
Once a state backs up a currency with this 'full faith and credit' then it has value. That is something bitcoin lacks.
"...whenever any Form of Government becomes destructive...it is the Right of the People to alter or to abolish it..."
Letsee, I can compare a centralized, locked down currency to a number of things.
DIVX (no, not the codec) to DVD.
ATRAC3 to MP3.
SDMI-compliant MP3 players to the iPod.
CPRM to regular HDDs.
Having one central party, who is free to do what they want with a currency is just asking for trouble.
I'll take Missing The Point for 800 Alex!
And the question is "This digital currency is centrally controlled and allows the authorities to monitor every purchase you make."
'What is centralized bitcoin?
You are correct.
The main reason to even bother with bitcoin is the attraction to its lack of central control and regulation. The other, closely related one, is that it works anywhere and for any purpose.
There's really no other reason to use it than the above. It has technical and practical limitations that normal electronic transfers don't have. Mistakes are forever, scams are rampant, technical understanding of what you're doing is vital if you like keeping your money.
There's no reason to bother with it over something like paypal or bank transfers if you're not into it for the lack of control or philosophical reasons, and a system controlled by a bank would do away with that.
They saw the free market currency bitcoin and felt it threatened their precious dollar (which they control at the Federal Reserve and enslave the American people through debt)
Now they want to own bitcoin through their own implementation and enslave you more :)
Enjoy your Rothschild Slavery :)
(Queue the next global warming article on slashdot - another Rothschild scheme to tax your carbon footprint - boy they sure can't get enough money and slavery :) )
The biggest problem with Bitcoin is that it's fucking awful to actually use it. If you want to run it on your own computer, you need to download a fucking massive amount of historic blockchain data. We're talking GB and GB of data, nearly all of which is absolutely useless for nearly all users. Yeah, you can use some other third party service, but that totally defeats the decentralization of Bitcoin. The reference client is quite shit. Even the network is shitty, since it takes so fucking long to process a transaction, making it unsuitable for most business uses. Then you have its development team which is fighting and bickering all of the time, even now as transactions get slower and slower. Then there are the occasional developer fuckups where the chain ends up at risk of forking and all hell breaks loose. All in all, it's an absolutely awful experience for most users.
It's a lot like desktop Linux or Rust. They sound all sweet and awesome, then you try them and find out that they aren't so useful after all. That's why they see almost no adoption. A small number of loud geeks get all hot and bothered by them, but regular developers and users try them and are very unimpressed. They end up being worse than whatever established alternative is already being used.
States could easily back the Bitcoin digital currency without creating their own. That a central bank wants to re-invent the wheel is more a testament to how much money there is to be made by a central bank controlling currency. That a State plays along and goes with the central bank's version is a testament to the control Bankers have over Governments.
Nothing new here really.
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
Oh, right! That's going to happen! Please, HSBC is just looking for another way to launder money
“He’s not deformed, he’s just drunk!”
..every SHA-256 hash will have to be calculated by rows of clerks armed with abacuses and quill pens.
So I'm sorry Mr. Smith, but according to the regulation in Chapter 48, paragraph 179 subsection j of volume 12 of last years' "Combined Banking and Virtual Currency Regulations", 3rd revision, we've been forced to suspend your account. No there's no appeal, this is not a judicial process. After all, it's only a virtual currency. Well then I suggest you read up on the regulations next time...
Seven puppies were harmed during the making of this post.
Once people put their "full faith" into something, then it is valuable. Be it bitcoin, the dollar, jesus, allah, the comunist manifesto etc.
I'll take Missing The Point for 800 Alex!
800 bitcoin?
[*ducks*]
If it weren't for deadlines, nothing would be late.
Once a state backs up a currency with this 'full faith and credit' then it has value. That is something bitcoin lacks.
The value of a currency is determined by what you can buy with it. You can buy stuff with bitcoin. Therefore, it has value. It doesn't need a nation-state to bestow a fiat value on it.
If it weren't for deadlines, nothing would be late.
Who saw this coming?
/sarcasm
We already have digital currency like this.
It's called "credit card".
And is also known by many, many other names, like "paypal" or "wallet" or any of a huge number of country-specific names.
Slashdot social media options: AIM, ICQ, Yahoo, Jabber and Mobile Text. Why no MySpace?
Fun Fact: (800) BIT-COIN is Satoshi Nakamoto's voice mail.
Sounds like ArseCoin
whipslash, the parent comment is an excellent example of how harmful the modding here can so often be.
Despite it being totally on-topic, very insightful, very informative, and absolutely correct, somebody has incorrectly modded it down.
It is at -1 as I write this.
Whoever modded down that comment did so abusively.
There is no reason for it to be modded down.
Whoever modded it down should never moderate again, in fact.
That abusive downmodding has harmed this site by unnecessarily hiding perfectly good content.
This is not an isolated incident, and happens far too often here.
I don't know if there's a connection, but these suspicious and unjustifiable -1 downmoddings of excellent content tend to happen in submissions that timothy posted.
Can you let us know if timothy and the other editors are able to moderate comments, and if they have ever used this ability to downmod legitimate comments?
The lack of transparency here regarding the modding is very concerning, especially with abusive downmodding like this happening.
The existing metamod system clearly isn't working, because incidents like this keep happening.
This site needs full transparency when it comes to moderating, because it involves the censorship of what are often good comments.
It's NOT a replacement for a decentralized "people's currency" which the pre-cartel BitCoin was* and which most other cybercurrencies are.
But it IS a convenient, possibly-stable** form of money which has clear advantages over paper money or traditional electronic transactions in some applications.
Again, if you want the anonymity and confidentiality that a suitcase full of 50-Euro notes gives you, this isn't for you.
* with rumors of a cartel in place, one should assume that the current BitCoin ecosystem is "controlled" by a "single entity" and treat it as such.
** backing by an existing currency or precious metal guarantees stability with what backs it, but even without that, if it's backed by a nation or a nation's official bank, that will create some stability all by itself.
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
Cash is both centrally controlled and protected and very anonymous.
A digital currency - please look up what currency means, if you're pedantic - would be a boon if backed by a proper nation state.
..don't panic
https://www.youtube.com/watch?...
They're going to do this and NOT call it BritCoin? or the BritBit?
I'm a long time lurker but had to sign up to point out the Royal Bank has missed the very obvious name: BRITcoin
I'll take Missing The Point for 800 Alex!
And the question is "This digital currency is centrally controlled and allows the authorities to monitor every purchase you make."
'What is a credit card?
You are correct.
There, fixed that for you.
We've had easily traceable purchases for some time now, in fact many of you are so enamoured with it you'll actually defend the way credit cards rip you off (Read: merchant service fees).
Calling someone a "hater" only means you can not rationally rebut their argument.
You are not very smart, are you. lol
Real Shit coin. For the love of god the attractive of crypto currencies is that there is no central authority, making it more difficult for a central authority to interfere with your financial affairs. The need for this might not yet be too apparent in industrialized countries, but elsewhere it is critical.
Say that your country takes on too much debt and defaults. They create a law whereby they confiscate your bank deposits and give you devaluated currency. Better to have capital in hand. But capital is a pain to store and transfer, and so you have bitcoin.
But what about drug dealers, you say? Simple. Do as with you do with alcohol and tobacco: LEGALIZE THEM. Decriminalize an industry with obvious demand and redirect all that drug hunting money to help the poor become less poor (and statistically less criminal), countries where you get much migration from (so you don't have so many illegals), etc. Or at least lower taxes.
Man... First world problems.
Whilst you're quite correct - credit cards are protected. If you're a victim of fraud, most banks stop the transactions before they happen. If they don't, you get your money back.
The whole point of Bitcoin and one of the key innovations behind it is that it is NOT centrally controlled or manipulated by a nation state. Bitcoin started as an experiment in decentralized, crypto-currencies that offer some level of protection against inflation, government tracking and control. A government creating an alt currency that is trackable, monitored and controlled by a central authority is the antithesis of the philosophy behind crypto currencies.
Whatever moron came up with this idea should be given a raise...because that's what governments do.
The value of bitcoin has value because private entities with fiat currency is backing it.
Strictly speaking, every currency is a fiat currency because we decide what it's worth based on how we feel about either it, or what's backing it. Whether it's gold or the combined goods and services the economy it supports.
There's no explicit gold to bread conversion.
Non impediti ratione cogitationus.
I have 100 Trillion Dollars* to hand you if you're correct.
*Zimbabwe. And yes, after that I will still have 1 quadrillion left. Yes. That much. I believe in the state backing currency that much I poured my life savings into it. Unfortunately, my life savings consisted of a dried out french fry and 2 cheetos. Still got all this cash for them, though! I'm gonna be rich some day!
Lots of firms waste "serious funds" all the time on projects that are obvious failures, and that end users and potential customers will want nothing to do with.
Just look at Mozilla and Firefox OS. Mozilla likely poured a huge amount of money into that debacle, yet after years of wheel-spinning pretty much nobody used it. Now they're doing the same with their new failures, Rust and Servo.
Look at Google+ as another example. No matter how much money Google spent on it, users just didn't want it.
Hell, look at Slashdot Beta! Again, it wouldn't have mattered how much Dice spent on it, the Slashdot users would not have used it.
In this case it's the end users that really matter. It's irrelevant how much money companies or organizations waste on blockchain products that people don't want.
Bitcoin is mainly being used by speculators, criminals, and hype promoters. Everyone else is pretty much ignoring it.
For people who typically deposit large sums of money in bank accounts (as opposed to investing in money markets, bonds, or stocks), even a very small "negative interest rate" is less costly than having the money in suitcases, in a private vault, or in a bank's safe-deposit box.
Keeping and using large amounts of paper currency has costs:
You have to pay storage costs, which can range from zero (in your wallet or mattress, or in a safe you already own) to a modest one-time cost (a fireproof safe in your house) to a recurring expense (renting a bank safe-deposit box).
You have to insure it against theft and destruction (or accept the risk of not insuring it, which may be fine if it's in a safe-deposit box or the maximum loss is small).
You have to accept the risk of it suddenly becoming temporarily inaccessible (if it's in a safe in your house and you are at work, and there's an emergency in your neighborhood and they aren't letting anyone in including residents, then it's "temporarily inaccessible").
For large transactions, you have to accept the inconvenience of filling out extra paperwork that your nation-state may require.
If you possess or carry large amounts, you also run the risk of government harassment and even seizure under the pretense that you "must be up to no good, any reason you give to the contrary is just a cover."
Knowledge is how to play a game, intelligence is how to win, wisdom is knowing what game to play.
In other words, the banks and bankers don't want any of us to be able to buy or sell without their knowing AND control over it, but they want to be able to buy,sell or steal whenever they want and be completely untracked.
This cannot be allowed, and your government officials are not going to do anything to stop it.
At lunch, somebody was talking about this and said "the people need to get control away from the banks and politicians by any means required, even if it means violence.".
Personally, I think people should always use peaceful means, but clearly not everybody feels that way.
RSCoin= Red Shield Coin
https://www.youtube.com/watch?v=mII9NZ8MMVM
You are very naive.
This is about CONTROL over the currency for the rich and powerful, and control over when, where, and IF you can spend it, and it puts control to TAKE your money at will, even if you participate in a protest, they will seize your money, potentially for years.
I can predit that years in advance. They will allow anonymous transaction. Then they will required paper to withdraw money. They can change the rule since they are the central authority. They can also emit as many as they want! They could probably have build that using mysql and simple public API in json!
I've also heard a more practical explanation: once a state accepts taxes in a currency, it has value.
Bitcoin without the decentralization mechanism is just a very clumsy database of transactions. You may as well just make something from a MySQL database and the development costs would be cheaper.
Sound it out: risk-coin. Perhaps not the best moniker for a digital currency.
The value of bitcoin has value because private entities with fiat currency is backing it.
No, I say again: bitcoin has value because you can buy stuff with it, and its value is measured in terms of what you can buy (including other currencies.)
Support from any entities (public or private) does not create that value -- it merely helps to stabilize it.
There's more about why bitcoin has value in the bitcoin FAQ.
Strictly speaking, every currency is a fiat currency because we decide what it's worth based on how we feel about either it, or what's backing it.
On this, we agree. But note the "or" in your sentence.
I once heard someone describe bitcoin as a "collective hallucination" that assigns a value to an abstract concept. But in the next sentence, the same person said that all currencies are the same kind of collective hallucination.
If it weren't for deadlines, nothing would be late.
I found the reference. It was Jonathan Zittrain from Harvard University:
Bitcoin is itself a collective hallucination -- as it turns out, most currencies are -- in which, there is agreement that the units of currency will have some form of value.
If it weren't for deadlines, nothing would be late.
I don't agree with this 'designed for' argument.
If a product or service works for an certain application, it makes absolutely no difference where it finds success outside its designed application. That's like people slating the use of Sat Nav because they don't own a submarine.
Exactly!
Great, so you have a type of digital currency that can log and track every transaction by every user that's ever laid paws on it....sounds peachy!
This isn't the same as tracking a debit card (which needs a warrent in most places and countries), its state property, so they don't need to ask if they want to archive and datamine all the transactions each coin logs once it finally gets back to the state.
I see no difference between this and a debit card system. It's a Government issued and maintained currency, complete with police and government spying.
we decide what it's worth based on how we feel about either it
Loose use of "we" here is contradicted by billions of dollars every day. It's called "currency arbitrage".
There are factors influencing individual -perceptions- of worth of particular currency, but the purchaser with the closest understanding of the -actual- worth is the guy that wins. This happens thousands of times a day. The notion that it is arbitrary is contradicted by the entire currency market. To claim it is arbitrary stipulates that much of the financial system is pure fantasy and fiction, despite the direct observable fact of it not being so.
Ultimately, a given currency maps to a specific pool of material value and labor potential. The fact this relationship is "really complicated" does not make that relationship nonexistent.
How long will it take for the IT folk to explain to their bosses why it would be better just to use a regular old database and some PKI?
Blockchains are a massive waste of time and effort, but I guess some techies get to make money while the non-techies figure that out.
While I had hoped that this would come from a more privacy-aware country than one of the five-eyes, I'm glad to see this. Yes we have centralized currency, but we don't have centralized digital currency. Instead we have credit cards, with the banks taking 2.5% - 3% from every online purchase while being just as traceable. More traceable really, since more people have access to the records.
This is a positive development. Now maybe Switzerland can do the same thing?
I'll take Missing The Point for 800 Alex!
And the question is "This digital currency is centrally controlled and allows the authorities to monitor every purchase you make."
'What is centralized bitcoin?
You are correct.
Bonus question: These transactions will be "entirely, or partially, anonymous"...
Answer: What are political contributions and government spending?
blindly antisocialist = antisocial
...system's design would also allow a central bank to make transactions entirely, or partially, anonymous.
The bank is under the control of the Chancellor of the Exchequer, who will be a Conservative Party MP, for probably more than the next decade after the planned gerrymandering during this spell in government, and they will get to choose what's anonymous and what is not. This does not bode well.
The reason why you can buy things with bitcoin is that you can use any number of services and cash out those bitcoins to fiat currency. If there wasn't this escape hatch, bitcoin wouldn't be seeing the traction it does.
Do you think a guy who's selling drugs on a darknet some where gives a shit that you think you're sticking it to some central banker?
Do you think that anyone who's involved with combining bitcoin with fiat currency transactions like BrainTree care about the ideology at all?
The ideology of bitcoin isn't what's driving bitcoin's value in the market right now.
Non impediti ratione cogitationus.
It used to be that gold and silver would be useful, despite not being backed by a state. (Early coinage was about having easily verifiable standard weights of precious metals available, not a state-backed currency.) Currency is valuable if enough people think it is valuable.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
Arse coin? I might pass on that one.