http://boards.straightdope.com/sdmb/showthread.php?t=663881&highlight=Bitcoin
In this thread. Giraffe convinced me that bitcoins would be a dud. Just curious if you still feel this way, Giraffe.
The system is breaking down. Here’s an article from January from a long time Bitcoin developer outlining the problems it was starting to encounter. By March, some of these predictions started to come true.
Basically all the major worst case scenarios that people envisioned but which were pooh-poohed by the Bitcoin core folks are happening.
You are now seeing some sites that formerly took Bitcoin dropping it since the transaction verification is taking too long.
It’s still a solution in search of a problem.
I agree with that; what can bitcoins do that I can’t with a credit card or electronic funds transfer?
That article from January would certainly make one pessimistic about the future of Bitcoin. The blockchain concept may have some interesting and useful applications, but a viable currency may not be one of them. Speculation breeds greed and inevitably there are groups who will do anything they can, regardless of morality or ethics, to maintain their positions.
With standard monetary systems, regulation contains this to at least some extent. With something like Bitcoin there are no regulators or, more correctly, the regulators are the ones with the biggest stake, and thus the most control. They’re benefiting from the status quo and therefore they resist change any way they can.
Unless an increase in the block size limit can be forced through somehow, it sounds like Bitcoin is stagnant.
Lose 7.5 million by throwing away a hard drive.
I still think that Bitcoin was actually developed by the FBI and/or CIA in order to make criminal activity easier to track. So far as I can tell, that’s the only thing it’s actually good for.
Eh isn’t the fact that is untraceable about the only thing it has going for it? and the reason 90% of the uses are on child porn.
It’s supposed to be untraceable. But how do we really know what organizations like the NSA are capable of? I can certainly see the NSA developing a pseudo-anonymous currency with a well-concealed backdoor that allows them to trace its movement and releasing it into the world.
Why, it’s almost as if a completely unfettered market leads to a series of boom bust cycles as well as acting as an invitation to speculation and fraud! Who would have guessed?
Oh, wait. That would be every mature economist and money theorist on earth.
At least my Altarian Dollars, Triganic Ningis, Pu’s and Flanian Pobble Beads are still holding value
I guess I invested in the right fictional currency…
I’m far from an expert on such things, but isn’t the block chain the exact opposite of untraceable?
I put all my wealth in quatloos. Hasn’t failed me (yet).
Wanna bet?
Are IP addresses stored in the Bitcoin blockchain? I don’t think so but like you I’m no expert. I suppose you can trace a transaction to the wallets involved but then you’d have to know who owns the wallets.
Apparently it’s at least somewhat anonymous. Otherwise Silk Road would have been shut down long before it was.
I suppose the weak point would be in converting it to and from cash.
I started in tulips, moved into the South Sea, tried Florida real estate and am now firmly invested in perpetual motion. What could go wrong? :eek:
It’s completely traceable - that’s the point of the block chain. Every transaction is verified.
It is (or can be) anonymous - if you don’t link anything to the wallet, then nobody knows who is behind the wallet.
That said, it’s not too hard to figure out the person behind the wallet, even if they are trying to be anonymous.
Prosecutors Trace $13.4M in Bitcoins From the Silk Road to Ulbricht’s Laptop
Right. You have to know who owns the wallet. As I understand it, in the case of Silk Road they tracked it down through so-called “side channel” information (Ulbricht stupidly talking about it on message boards). Once they found him and his laptop they had his wallet ID and the rest was simple.
Not that anyone should ever assume that their Bitcoin transactions are anonymous. Like TOR, assume that you can be tracked. In any case, people shouldn’t be engaging in illegal activities to begin with.
But “linking anything to the wallet” includes using it to buy anything. If I engage in some criminal activity that pays me in bitcoins, and I then use those bitcoins to buy something from Best Buy, and Best Buy cooperates with the police, then they can connect me to those bitcoins. And if they know from other investigations that those bitcoins I received were connected to some crime, well now they can connect me to that crime, too.
Or maybe I only use my bitcoins to pay other criminals. But now, if anyone ever uses a single wallet more than twice (once to receive funds and once to pass them on), the police (and everyone else who cares to look) has a picture of my entire network. And as long as there are a few loose ends on the edges of that network (and there always are), the police just have to tug a bit on those loose ends and they’re pulling the entire thing.
Bitcoin is flawed as a serious currency - It’s been useful for making illicit transactions, and it or any similar system will be used for drug purchases and moving money past border controls. But the basic design of Bitcoin lacks scalability (the basic protocol can’t handle many transactions at once) and can easily be ‘broken’ by whoever controls the most of the ‘mining’ systems (peer to peer regulation works great when you have a million similar pools voting, it breaks badly when someone controls 40-60% of the vote with their pool). Bitcoins as set up allowed the people who joined early to collect a huge ‘fortune’ in bitcoins, but if it was going to become a serious currency there’s no way people adopting it would let them keep that cash (and it’s trivial to solve, just use the bitcoin protocol, call your coins something else like AmazonCoins, and start at zero without making those pesky hoarders billionaires).
It’s not actually untraceable at all, every single transaction is stored in the blockchain. There isn’t a name attached to each bitcoin address, but you can see what addresses coins flow to and from. Once you have that, it’s not hard to attach names to addresses through various means, most commonly through the bitcoin addresses people use to move out of bitcoin into real money or goods. People try to obfuscate by splitting up money and bouncing it through lots of smaller addresses so you ‘can’t tell’ where it goes, but really basic computer analysis will trace through that without much effort.