What I don't understand is this: Bitcoin is a distributed network. We know (or can know) which bitcoins were "lost" in MtGox. What is "true" in the Bitcoin world is determined by the "opinion" of the network.
So couldn't the top 5 or 10 players in the network, who collectively have something like 75% of the computing power, collude and simply invalidate the transactions out of MtGox?
No, the top largest mining pools cannot because:
1) A 51% attack doesn't change the blockchain history or allow one to steal funds out of existing accounts. If this even ever did occur(unlikely) they could simply either temporarily deny new transactions from being processed or make 1-3 double spends before being noticed and stopped.
2) The miners in the mining pools can instantly switch pools if their trust is misplaced by the pool operators with no effort and have done so repeatedly in the past where top mining pools have gone out of favor
3) The true power of the direction of the Bitcoin protocol lies within the "Full nodes" which is any user who chooses a wallet that downloads the full blockchain and not a SPV or thin wallet.
4) Fungibility is an important concept that many in the community hold as sacrosanct and choose to respect. Their are certain fundamental principles which define bitcoin that we agree upon for the most part and one of them is the fact that all coins are equal and blacklisting will not be instituted
That is a barrier to competition, but look how fast Bitcoin arose.
History is replete with examples of superior technologies that never get a foothold because of the network effect. A technology has to be dramatically superior to overcome this in many cases. Any alt feature set can simply be rolled into bitcoin if it is good enough as Bitcoin is simply an evolving open source protocol where 60% of the code has already changed.
There is no reason to assume that Bitcoin will stay on top other that its first mover status. Not a single other reason.
History has shown that all republics and nations will ultimately fail as well, so yes, in this sense I agree with you, in 100 years bitcoin may likely be replaced.
Bitcoin has no value if it is not used..The use of Bitcoin is somewhat arbitrary, unlike the Euro or USD.
USD has no value if not used either. I receive Bitcoin as payments, pay employees in bitcoin, make retail purchases in bitcoin for discounts, tip in bitcoin, wire money in bitcoin, and give out loans in bitcoin, no different than USD.
Bitcoins, as of today, are only valued relative to USD and Euro, for all practical purposes.
Bitcoin has value relative to all currency, commodities, and services just like the dollar. In fact most activity with Bitcoin is centered around the BTC/CNY currency pair and not USD or EUR currencies.
Bitcoin has no value if it is not used. The use of Bitcoin is somewhat arbitrary, unlike the Euro or USD. It would be much easier to have another digital currency topple Bitcoin than have Bitcoin topple an national currency.
Bitcoin isn't toppling any national currencies and no one even suggested so. Fiat and Bitcoin will continue to coexist, compete, and assist each other all at the same time.
So, I agree that Bitcoin has a first move advantage, but your confidence that other digital currencies could not quickly compete appears to be higher than mine. The problem is that is Bitcoin's only advantage.
What about all the hardware and software that cannot so easily be re-purposed for other digital currencies? ATM'S, BTC Hardware wallets, POS systems, ASIC miners, ect...
There are other currencies, certainly, but none are competing to be the official currency of the US. That is the key difference that you are throwing aside as if it is meaningless, and I assure you it isn't. A digital currency has a unique characteristic that make it compelling for a global exchange medium, but there is nothing unique among other digital currencies.
I've stated quite the opposite, indicating that the USD does indeed have a unique difference in that it is considered legal tender while Bitcoin is sovereign and has its own unique properties that the USD lacks.
The USD is unique as the standard US currency. Just as every other national currency is unique.
You seem to have a hard time grasping why and how a digital asset can have value. The value Bitcoin has comes from the billion+ invested in hardware, development, startups, education, marketing , and acceptance. Much of this hardware and software cannot be easily re-purposed for other crypto-currencies. Another token cannot come along and easily topple Bitcoin, just the same as a competing national currency cannot so easily topple the USD as being the most accepted reserve currency worldwide.
No, there is only one currency standard for the country. They can trade with other currencies but everything is based on its relation to the USD, but as far as the USD goes, there is not competitor in the US, and particularly not one that influences the value of the USD.
There is a world that exists outside your country, and one that has ~4 billion unbanked and underbanked. Within the US the dollar does indeed have many competitors, one of them being Bitcoin. The one unique thing the dollar has that Bitcoin doesn't is it is considered Legal Tender and has the privilege of the sole currency to pay taxes with and is a mandated option to repay debt with in your geographic region.
What we really need is the government to create a virtual currency, with all the regulation and control that entails. Then you can have all the benefits of a cryptocurrency but with the benefits of it actually becoming mainstream for the majority of users, without the problems a truly anonymous one has with regard to criminal activity.
All governments do already indeed create "virtual currencies" as most fiat exists as digital tokens. Many of the benefits you speak of that Bitcoin provides will never be adopted by governments as some of the intrinsic properties are antagonistic to governments needs and desires.
Ripple is centralized and works based the economic principles of debt like most Fiat which is fundamentally different than Bitcoin where the token is a store of value itself instead of Ripple which uses "ripples" or XRP as an anti-spam token to process transactions and all payments are debt based, which carry counter-party risk.
In other words, they are not similar at all in nature and both will likely co-exist with Ripple appealing more to governments and banks.
Isn't the problem with the value of the USD is that there can be an infinite amount of competing currencies expressed by giftcards, crypto-currencies, and other forms of fiat?
It's possible that like the dollar (most widely adopted reserve currency) Bitcoin will also harness the first mover advantage and network effect to remain the principally used cyrpto-currency amongst a pool of competing currencies?
There are many examples of decentralized sites: openbazaar, twister, bitmarkets, ect... all which require no centralized servers and are created with DHT and the blockchain protocol.
The notion that "portraying men as muscled killing machines" is a kind of sexism has not yet arrived in the mainstream.
Which tells you interesting things about our society.
Still: women are more likely to be displayed in roles perceived as *de*grading, whereas men are portrayed with attributes perceived as positive (strength, power, etc). So the problem of sexism against females should get priority imho.
Portraying men as sex addicted, killing machine simpletons is degrading to the male gender. Many feminists would disagree with you and suggest that female sexuality if empowering.
Using stealth addresses, coinjoin or coinshuffle make bitcoin just as hard to track as physical cash, if not, harder. Purchasing items with Virgin coins that you can get with cloud mining make it impossible to track. Bitcoin is as anonymous or tranparent as you choose to make it.
Except those fund can automatically be transferred to a legal team to assist you fight the charges, or a friend, partner who can hire a legal team. With asset forfeiture your funds are stolen so defending yourself against the state is much more difficult. Additionally, you can insure you don't encourage them to arrest you by making yourself an easy target for asset forfeiture.
Umm, the federal government has already seized someone's bitcoins, they could do the same to yours if they so chose.
Notice how they only seized the unsecured portion of Ross Ulbricht's supposed vendors bitcoin's sitting on the servers escrow account and not the majority sitting in cold storage which they cannot sell or get access to.
Now to find a way to live with only 20,999,839.77 bitcoins for everyone in the US, robbing the rest of the world from their use of bitcoins...
Huh? You do realize that there is good evidence that most bitcoin private keys exist outside of the US, right?
Additionally, you are missing the point as there is no need to enrich early investors and innovators of Bitcoin, as using an alt or forking the code is trivial. They may choose to use it because it is advantageous to do so however.
Depends. If you're happy that nothing bad will ever happen to you then carry on believing in Libertaria. Me I'll rely on the fact that I will get treatment when I'm sick and won't starve if I am no longer able to work through no fault of my own.
Believe it or not most anarchists are perfectly content you choosing to live under a modern state. Were you aware that we don't have those same choice unless we move to Antarctica or the moon? For some strange reason states don't look too favorably at competing in the marketplace of ideas and tend to get very violent against peaceful people not submitting to them.
You are hilarious, the IRS has all it needs to find and get your bitcoins. They have you, see XKCD five dollar wrench comic.
Sure, I'll give up the location of my private keys when being waterboarded and my password to unlock the coins. You do understand that a simple dead mans switch into a multisig account or an nTimelock will make it easy for me to prove to the people torturing me that I know longer have access to the funds and that they cannot be taken or seized right?
It will indeed be interesting. But make no mistake about it, when they can pass a law that lets them take money from businesses without any illegal activity, they can pass a set of laws that allows them to seize bitcoins. Worst case they can just make all bitcoin transfers illegal except through some kind of framework where they get the information/control they need. All they need to do is pass the law against the will of the people (seems easy enough) or even just let some bad guys exploit the holes that are there now, and then publicize these and tell everyone to "think of the children", and they have public support for a set of laws.
From this perspective, the suggestion that "we should all just switch to Bitcoin to solve this problem with the law" is laughable. It is trying to solve a political problem through technical means. You let the same people be in control and expect that this new system will not also be seized upon when the masses can use it. Of course it will.
Your statements indicate you are unfamiliar with how resistant bitcoin is to any form of regulation. Any form of security doesn't need to make it impossible but impractical to control and regulate at scale. With this in mind investigations on the blockchain can and will persist but will remain unfeasible at scale efficiently.
Bitcoin can be transferred over any port, including 80 and combined with Tor make it unstoppable even with the most sophisticated Deep packet inspection. Shutting down the whole internet, while practically impossible, won't solve the problem anyways as very inexpensive hardware wallets are being released shortly that can work without the internet - https://mycelium.com/bitcoinca... . Will a backdoor be placed within an update of the code to subvert bitcoin? Good luck getting that past the team of developers which over half are paranoid anarchist/libertarians. Lets assume Bitcoin Core does get subverted, do you realize there are multiple implementations that interact with the blockchain that have separate teams of developers and written in other languages? Perhaps governments get fed up and decide to spend billions to perform a 51% attack? This will effectively allow one to create 1-3 fake transactions on the network before being blocked and than a few lines of code will prevent this attack.
The bigger question is how do regulators think it will be feasible to control and enforce bitcoin effectively being that they haven't done to well at stopping wikileaks and torrenting yet and Bitcoin in many ways is more resilient and these 2 decentralized precursors
Sure, you can freeload in your own country & take advantage of the infrastructure that other people pay for. Do you think your approach can scale?
You are making two flawed assumptions. The poster never gave an indication as to whether or not he pays taxes, he merely insinuated that he doesn't care about or participate in politics. Secondly, if we assume he is avoiding paying taxes, you cannot automatically posit that he doesn't contribute to the country or infrastructure with the funds saved. Many anarchists are conscientious objectors who will purposely invest money not paid towards funding the military industrial complex or subverting our privacy for non-profit causes instead.
Actually, if they put their cash in a box, local police can seize it, as that much currency is only hoarded for criminal purposes.
They cannot seize a multi-sig Bitcoin wallet either through hacking or by physical invasion. The assets can even be designed to automatically move with a dead mans switch after a certain length of time or moved to a nTimelock where the funds cannot be spent for a certain length of time.
if you are not paying taxes the IRS can treat you like they treated Al capone.
It certainly will be interesting to see how the IRS and authorities deal with bitcoin in the future. How do they find funds they don't know exist or belong to an individual? How do they access capital gains on assets that are spent, lost or transferred to a wallet not associated with your identity? How do they seize funds that can be made immune to asset forfeiture?
Slashdot Mirror
What I don't understand is this: Bitcoin is a distributed network. We know (or can know) which bitcoins were "lost" in MtGox. What is "true" in the Bitcoin world is determined by the "opinion" of the network.
So couldn't the top 5 or 10 players in the network, who collectively have something like 75% of the computing power, collude and simply invalidate the transactions out of MtGox?
No, the top largest mining pools cannot because:
1) A 51% attack doesn't change the blockchain history or allow one to steal funds out of existing accounts. If this even ever did occur(unlikely) they could simply either temporarily deny new transactions from being processed or make 1-3 double spends before being noticed and stopped.
2) The miners in the mining pools can instantly switch pools if their trust is misplaced by the pool operators with no effort and have done so repeatedly in the past where top mining pools have gone out of favor
3) The true power of the direction of the Bitcoin protocol lies within the "Full nodes" which is any user who chooses a wallet that downloads the full blockchain and not a SPV or thin wallet.
4) Fungibility is an important concept that many in the community hold as sacrosanct and choose to respect. Their are certain fundamental principles which define bitcoin that we agree upon for the most part and one of them is the fact that all coins are equal and blacklisting will not be instituted
That is a barrier to competition, but look how fast Bitcoin arose.
History is replete with examples of superior technologies that never get a foothold because of the network effect. A technology has to be dramatically superior to overcome this in many cases. Any alt feature set can simply be rolled into bitcoin if it is good enough as Bitcoin is simply an evolving open source protocol where 60% of the code has already changed.
There is no reason to assume that Bitcoin will stay on top other that its first mover status. Not a single other reason.
History has shown that all republics and nations will ultimately fail as well, so yes, in this sense I agree with you, in 100 years bitcoin may likely be replaced.
Bitcoin has no value if it is not used. .The use of Bitcoin is somewhat arbitrary, unlike the Euro or USD.
USD has no value if not used either. I receive Bitcoin as payments, pay employees in bitcoin, make retail purchases in bitcoin for discounts, tip in bitcoin, wire money in bitcoin, and give out loans in bitcoin, no different than USD.
Bitcoins, as of today, are only valued relative to USD and Euro, for all practical purposes.
Bitcoin has value relative to all currency, commodities, and services just like the dollar. In fact most activity with Bitcoin is centered around the BTC/CNY currency pair and not USD or EUR currencies.
Bitcoin has no value if it is not used. The use of Bitcoin is somewhat arbitrary, unlike the Euro or USD. It would be much easier to have another digital currency topple Bitcoin than have Bitcoin topple an national currency.
Bitcoin isn't toppling any national currencies and no one even suggested so. Fiat and Bitcoin will continue to coexist, compete, and assist each other all at the same time.
So, I agree that Bitcoin has a first move advantage, but your confidence that other digital currencies could not quickly compete appears to be higher than mine. The problem is that is Bitcoin's only advantage.
What about all the hardware and software that cannot so easily be re-purposed for other digital currencies? ATM'S, BTC Hardware wallets, POS systems, ASIC miners, ect...
Quite true, many countries in Central and Latin America accept at least 2 forms of Fiat practically everywhere, with no questions asked.
There are other currencies, certainly, but none are competing to be the official currency of the US. That is the key difference that you are throwing aside as if it is meaningless, and I assure you it isn't. A digital currency has a unique characteristic that make it compelling for a global exchange medium, but there is nothing unique among other digital currencies.
I've stated quite the opposite, indicating that the USD does indeed have a unique difference in that it is considered legal tender while Bitcoin is sovereign and has its own unique properties that the USD lacks.
The USD is unique as the standard US currency. Just as every other national currency is unique.
You seem to have a hard time grasping why and how a digital asset can have value. The value Bitcoin has comes from the billion+ invested in hardware, development, startups, education, marketing , and acceptance. Much of this hardware and software cannot be easily re-purposed for other crypto-currencies. Another token cannot come along and easily topple Bitcoin, just the same as a competing national currency cannot so easily topple the USD as being the most accepted reserve currency worldwide.
No, there is only one currency standard for the country. They can trade with other currencies but everything is based on its relation to the USD, but as far as the USD goes, there is not competitor in the US, and particularly not one that influences the value of the USD.
There is a world that exists outside your country, and one that has ~4 billion unbanked and underbanked. Within the US the dollar does indeed have many competitors, one of them being Bitcoin. The one unique thing the dollar has that Bitcoin doesn't is it is considered Legal Tender and has the privilege of the sole currency to pay taxes with and is a mandated option to repay debt with in your geographic region.
What we really need is the government to create a virtual currency, with all the regulation and control that entails. Then you can have all the benefits of a cryptocurrency but with the benefits of it actually becoming mainstream for the majority of users, without the problems a truly anonymous one has with regard to criminal activity.
All governments do already indeed create "virtual currencies" as most fiat exists as digital tokens. Many of the benefits you speak of that Bitcoin provides will never be adopted by governments as some of the intrinsic properties are antagonistic to governments needs and desires.
Ripple is centralized and works based the economic principles of debt like most Fiat which is fundamentally different than Bitcoin where the token is a store of value itself instead of Ripple which uses "ripples" or XRP as an anti-spam token to process transactions and all payments are debt based, which carry counter-party risk.
In other words, they are not similar at all in nature and both will likely co-exist with Ripple appealing more to governments and banks.
Isn't the problem with the value of the USD is that there can be an infinite amount of competing currencies expressed by giftcards, crypto-currencies, and other forms of fiat?
It's possible that like the dollar (most widely adopted reserve currency) Bitcoin will also harness the first mover advantage and network effect to remain the principally used cyrpto-currency amongst a pool of competing currencies?
There are many examples of decentralized sites: openbazaar, twister, bitmarkets, ect ... all which require no centralized servers and are created with DHT and the blockchain protocol.
Just for women ? That's really sexist !
The notion that "portraying men as muscled killing machines" is a kind of sexism has not yet arrived in the mainstream. Which tells you interesting things about our society.
Still: women are more likely to be displayed in roles perceived as *de*grading, whereas men are portrayed with attributes perceived as positive (strength, power, etc). So the problem of sexism against females should get priority imho.
Portraying men as sex addicted, killing machine simpletons is degrading to the male gender. Many feminists would disagree with you and suggest that female sexuality if empowering.
http://blog.bitpay.com/2014/11/04/bitcoin-checkout-one-tap-mobile-bitcoin-payments.html
Yes, I understand the downsides of fewer merchant acceptance but there are plenty of upsides as well for everyone.
Orders can be priced in 150+ currencies, and past payment information is only a few taps away.
We’re now rolling out the app to every mobile market worldwide, in the 40 languages spoken by 99.99% of the world’s population.
Using stealth addresses, coinjoin or coinshuffle make bitcoin just as hard to track as physical cash, if not, harder. Purchasing items with Virgin coins that you can get with cloud mining make it impossible to track. Bitcoin is as anonymous or tranparent as you choose to make it.
The future is being developed and we are already testing a marketplace that cannot be shutdown.
Decentralized marketplace for instantly trading uses blockchain technology, DHT, and mutisigniture arbitration.
https://openbazaar.org/
Beta 3 is about to be released. Join Us and support the future with a decentralized Ebay - https://github.com/OpenBazaar/...
http://tip4commit.com/projects/728
The lawyers don't even need to know. The funds came in as anonymous donations for the legal fund which was than given to the lawyer.
Except those fund can automatically be transferred to a legal team to assist you fight the charges, or a friend, partner who can hire a legal team. With asset forfeiture your funds are stolen so defending yourself against the state is much more difficult. Additionally, you can insure you don't encourage them to arrest you by making yourself an easy target for asset forfeiture.
Umm, the federal government has already seized someone's bitcoins, they could do the same to yours if they so chose.
Notice how they only seized the unsecured portion of Ross Ulbricht's supposed vendors bitcoin's sitting on the servers escrow account and not the majority sitting in cold storage which they cannot sell or get access to.
Now to find a way to live with only 20,999,839.77 bitcoins for everyone in the US, robbing the rest of the world from their use of bitcoins...
Huh? You do realize that there is good evidence that most bitcoin private keys exist outside of the US, right? Additionally, you are missing the point as there is no need to enrich early investors and innovators of Bitcoin, as using an alt or forking the code is trivial. They may choose to use it because it is advantageous to do so however.
Depends. If you're happy that nothing bad will ever happen to you then carry on believing in Libertaria. Me I'll rely on the fact that I will get treatment when I'm sick and won't starve if I am no longer able to work through no fault of my own.
Believe it or not most anarchists are perfectly content you choosing to live under a modern state. Were you aware that we don't have those same choice unless we move to Antarctica or the moon? For some strange reason states don't look too favorably at competing in the marketplace of ideas and tend to get very violent against peaceful people not submitting to them.
You are hilarious, the IRS has all it needs to find and get your bitcoins. They have you, see XKCD five dollar wrench comic.
Sure, I'll give up the location of my private keys when being waterboarded and my password to unlock the coins. You do understand that a simple dead mans switch into a multisig account or an nTimelock will make it easy for me to prove to the people torturing me that I know longer have access to the funds and that they cannot be taken or seized right?
It will indeed be interesting. But make no mistake about it, when they can pass a law that lets them take money from businesses without any illegal activity, they can pass a set of laws that allows them to seize bitcoins. Worst case they can just make all bitcoin transfers illegal except through some kind of framework where they get the information/control they need. All they need to do is pass the law against the will of the people (seems easy enough) or even just let some bad guys exploit the holes that are there now, and then publicize these and tell everyone to "think of the children", and they have public support for a set of laws.
From this perspective, the suggestion that "we should all just switch to Bitcoin to solve this problem with the law" is laughable. It is trying to solve a political problem through technical means. You let the same people be in control and expect that this new system will not also be seized upon when the masses can use it. Of course it will.
Your statements indicate you are unfamiliar with how resistant bitcoin is to any form of regulation. Any form of security doesn't need to make it impossible but impractical to control and regulate at scale. With this in mind investigations on the blockchain can and will persist but will remain unfeasible at scale efficiently.
Bitcoin can be transferred over any port, including 80 and combined with Tor make it unstoppable even with the most sophisticated Deep packet inspection. Shutting down the whole internet, while practically impossible, won't solve the problem anyways as very inexpensive hardware wallets are being released shortly that can work without the internet - https://mycelium.com/bitcoinca... . Will a backdoor be placed within an update of the code to subvert bitcoin? Good luck getting that past the team of developers which over half are paranoid anarchist/libertarians. Lets assume Bitcoin Core does get subverted, do you realize there are multiple implementations that interact with the blockchain that have separate teams of developers and written in other languages? Perhaps governments get fed up and decide to spend billions to perform a 51% attack? This will effectively allow one to create 1-3 fake transactions on the network before being blocked and than a few lines of code will prevent this attack.
The bigger question is how do regulators think it will be feasible to control and enforce bitcoin effectively being that they haven't done to well at stopping wikileaks and torrenting yet and Bitcoin in many ways is more resilient and these 2 decentralized precursors
Sure, you can freeload in your own country & take advantage of the infrastructure that other people pay for. Do you think your approach can scale?
You are making two flawed assumptions. The poster never gave an indication as to whether or not he pays taxes, he merely insinuated that he doesn't care about or participate in politics. Secondly, if we assume he is avoiding paying taxes, you cannot automatically posit that he doesn't contribute to the country or infrastructure with the funds saved. Many anarchists are conscientious objectors who will purposely invest money not paid towards funding the military industrial complex or subverting our privacy for non-profit causes instead.
Actually, if they put their cash in a box, local police can seize it, as that much currency is only hoarded for criminal purposes.
They cannot seize a multi-sig Bitcoin wallet either through hacking or by physical invasion. The assets can even be designed to automatically move with a dead mans switch after a certain length of time or moved to a nTimelock where the funds cannot be spent for a certain length of time.
if you are not paying taxes the IRS can treat you like they treated Al capone.
It certainly will be interesting to see how the IRS and authorities deal with bitcoin in the future. How do they find funds they don't know exist or belong to an individual? How do they access capital gains on assets that are spent, lost or transferred to a wallet not associated with your identity? How do they seize funds that can be made immune to asset forfeiture?