Log from irc://irc.atrum.org/politics Ubermensch = some dude olinguito = me 2013-10-22 22:56:42 http://pragcap.com/bitcoin-nearing-the-end 2013-10-22 23:04:00 june 13 - kinda old by now in bitcoin time! 2013-10-22 23:05:41 i don't think it's nearing the end but he makes the point that if it becomes too popular govts might shut it down 2013-10-22 23:07:20 yeah my crystal ball is failing me on that one; it might be too late 2013-10-22 23:07:55 what do you mean by that? 2013-10-22 23:09:03 bitcoin is pretty much global now; technically i think it would be hard for any single government to shut it down; i think it's reaching the point where states realize they might have to compete with each other for their share of the bitcoin economy 2013-10-22 23:10:16 it's global but very marginal, due to the fact it's decentralized every country will have the incentive to shut it down if it displaces conventional money 2013-10-22 23:11:50 i think it's an interesting idea but don't get too excited, maybe 2013-10-22 23:11:55 can you unpack that incentive? and what premises are you assuming? 2013-10-22 23:12:10 did you read the article? 2013-10-22 23:12:23 i was thinking that germany has an incentive to encourage it 2013-10-22 23:12:32 a way of exiting the euro without exiting the eury 2013-10-22 23:12:46 i read the story elsewhere, but i haven't read that article yet 2013-10-22 23:13:24 they can't control bitcoin, so while exiting the euro might suit them, bitcoin isn't an alternative 2013-10-22 23:14:46 re taxation: i think bitcoin is fantastic for regulation! the entire ledger is public 2013-10-22 23:15:18 germany can't regulate bitcoin 2013-10-22 23:15:28 now sure, you don't know who has which addresses, but you can attack *that* problem legislatively 2013-10-22 23:15:32 they can't expand or decrease the money supply either 2013-10-22 23:15:40 no, but would they want to? 2013-10-22 23:15:48 yeah, i think they would 2013-10-22 23:16:02 can they expand or contract the euro unilaterally? 2013-10-22 23:16:48 no, but the euro isn't working for them, is it? 2013-10-22 23:17:04 i'm just saying that bitcoin might not be worse than the euro 2013-10-22 23:17:24 if they were to exit the euro bitcoin wouldn't be a good option, their own currency would 2013-10-22 23:17:31 the fact being that while they (germany) can't expand or contract the money supply unilaterally, they also know that neither can greece 2013-10-22 23:17:49 yeah, going back to the deutschmark 2013-10-22 23:18:00 i'm on a more cynical tack 2013-10-22 23:18:17 they could semi-unofficially use bitcoin to exit the euro without "exiting the euro" 2013-10-22 23:18:42 a plausible deniability thing 2013-10-22 23:18:59 taxes would still be payable in euro 2013-10-22 23:20:02 govts are going to see bitcoin as a threat if it ever becomes popular, the people taking up bitcoin are going to be the ones vested in evading taxes and that sort, so a collision course is likely 2013-10-22 23:21:34 yes, my default reasoning goes that way too, but i try to keep an open mind 2013-10-22 23:22:52 i think a bigger threat to bitcoin than the collision-in-tax-philosophy scenario is banksters 2013-10-22 23:23:08 well, the banks and the politicians are closely aligned 2013-10-22 23:23:18 it's the *banksters* that i think who stand to lose the most from bitcoin gaining currency 2013-10-22 23:23:28 they are, but they're not one and the same 2013-10-22 23:24:07 banks and bitcoin are rivals for regulatory favour, so in a sense politicians might welcome the new "competitor" 2013-10-22 23:24:11 either way the govts will have an incentive to shut bitcoin down if it ever becomes an actual threat to public goods or even the banks as you point out, and this goes for any sovereign country 2013-10-22 23:24:43 the present financial system is tied with the politics and all those involved have political leverage 2013-10-22 23:25:02 the existence of bitcoin as an alternative could give legislators more bargaining power to extract concessions from the banks (more campaign contributions, higher taxes, whatever) 2013-10-22 23:25:29 a parallel: the dollarification of zimbabwe 2013-10-22 23:25:40 or the soviet union 2013-10-22 23:28:42 i'm not convinced that the tax thing is such a big issue 2013-10-22 23:29:06 not being able to regulate the financial system is a big issue 2013-10-22 23:29:24 define "regulate"? 2013-10-22 23:29:41 are you talking about just the ability to increase/decrease the money supply? 2013-10-22 23:30:21 that's part of it, the financial sector in the US for example is very closely and precisely regulated 2013-10-22 23:31:16 i can definitely see regulators clamping down on exchanges 2013-10-22 23:31:25 and afaik, they already do 2013-10-22 23:31:32 that's the trouble mtgox had 2013-10-22 23:31:54 things like: having to take details of your customers 2013-10-22 23:31:56 and i don't agree that taxation is a non-issue 2013-10-22 23:33:11 don't get me wrong though, i liek the idea of bitcoin. just trying to be real about its prospects 2013-10-22 23:34:44 http://www.technologyreview.com/news/520296/leading-economist-predicts-a-bitcoin-backlash/ 2013-10-22 23:34:47 Title: Economist Warns a Bitcoin Backlash May Be Coming from Governments and Banks | MIT Technology Review (at www.technologyreview.com) 2013-10-22 23:34:59 another parallel: old school cash 2013-10-22 23:35:03 “There is going to be a big political backlash,” Johnson said on stage at MIT Technology Review’s EmTech conference in Cambridge, Massachusetts, last Thursday. “And the question is whether the people behind those currencies are ready for that and have their own political strategy.” 2013-10-22 23:35:08 that's about as anonymous as you get 2013-10-22 23:35:17 and a lot bigger than bitcoin is now 2013-10-22 23:35:23 ^ people interested in bitcoin need to be ready for stuff like that rather than getting lost in over-excitement 2013-10-22 23:35:46 yeah, i'm a bit disappointed by the "bitcoin uber alles" circlejerk too 2013-10-22 23:36:11 people get so excited about the nice possibilities they don't think about the nasty possibities 2013-10-22 23:36:47 Yeah, i'm a pessimist about it, really, at best I think it sticks around as an underground currency 2013-10-22 23:38:18 uhm, can i invite you to take this up in #bitcoin on freenode? 2013-10-22 23:38:32 i'm already getting my cheat notes for arguing with you, from there :) 2013-10-22 23:38:45 "However, Johnson says that Bitcoin’s success will draw increased attention from governments and regulators, who are used to having tight control over currencies. He believes they will be egged on by established financial institutions, which will likely seek to quash the currency." 2013-10-22 23:39:19 basically what we just said 2013-10-22 23:39:31 berndj: any country that moves to cut its populace off from btc won't shut it down, it will just exclude its populace from its benefits 2013-10-22 23:39:31 with the rest of the world benefiting 2013-10-22 23:39:31 helo: yep, and will have minimal impact on black markets anyway 2013-10-22 23:39:38 berndj = me 2013-10-22 23:40:02 it's going to be an uphill battle for the bitcoiners, at any rate 2013-10-22 23:40:30 my thinking is that yes, what you say might occur to regulators, in that they might want to shut it down, but their political environment might make it difficult 2013-10-22 23:40:36 "Stephen Pair, cofounder and CTO of the Bitcoin payments company Bitpay, says his company has been contacted by state and national officials who have subpoenaed information about its activities." 2013-10-22 23:40:47 by the time they realize they want to shut it down, it might be too late 2013-10-22 23:41:11 that's possible, i'm not that optimistic though 2013-10-22 23:41:20 they're already getting jumpy 2013-10-22 23:41:24 and bitcoin is small 2013-10-22 23:41:39 it can make bitcoin not worth using very much among its populace <-- referring to applying heat on bitcoin; i kinda agree 2013-10-22 23:41:48 i can't buy anything i'd want to with it at this point 2013-10-22 23:41:53 yeah, $2b market cap is really tiny in the big picture 2013-10-22 23:42:13 what would you want? 2013-10-22 23:42:24 He also said that some governments outside the U.S. may feel threatened by Bitcoin because it allows citizens and companies to sidestep restrictions on the movement of funds across their borders. 2013-10-22 23:42:27 i think one should keep in mind that it's a classic disruptive technology 2013-10-22 23:42:40 if the americans tighten the noose on bitcoin with too much regulation, it will grow overseas, and americans will be left behind. there is no stopping it. the gov should just buy some and put it in the treasury 2013-10-22 23:42:51 has Russia or China said anything about bitcoin that you know of? 2013-10-22 23:42:56 it's good enough (better, in fact) for some purposes, but not at all 2013-10-22 23:43:17 as far as i know bitcoin is big in china - but kinda black market 2013-10-22 23:43:19 other govts have as much incentive to close bitcoin down as other places 2013-10-22 23:43:27 yeah but i'm wondering what the govt responses are 2013-10-22 23:43:28 i don't know of their having said anything about it 2013-10-22 23:43:43 they rely even more on taxes and regulation in China 2013-10-22 23:43:48 and Europe 2013-10-22 23:43:48 but it's another angle: they might be silently in support of bitcoin as an attack on the USD? 2013-10-22 23:43:50 than the US 2013-10-22 23:44:34 i don't think it would suit them for the USD to lose value too fast at this point 2013-10-22 23:44:35 china's long wanted some international currency that isn't the dollar, for things like settling trade balances and i guess oil 2013-10-22 23:45:34 hey, mind if i pastebin this bitcoin chat to link to in #bitcoin? 2013-10-22 23:46:15 you can, but i'm sure they have snappy responses to everything being said. we'll need to see how it plays out in reality, i guess 2013-10-22 23:46:30 yeah they do tend to be a bit circlejerky 2013-10-22 23:47:29 it's possible bitcoin finds a way and it's an incredibly innovative idea, i just am not going to get too excited about it. seems to me there's going to be an uphill battle 2013-10-22 23:48:55 at some point when i'm not so broke anymore i'd like to buy some (not much) just in case it does take off big time 2013-10-22 23:49:03 kinda like gambling :) 2013-10-22 23:49:18 and i also want to start telling people i accept payment in bitcoin 2013-10-22 23:49:22 yeah 2013-10-22 23:49:37 it's easy enough to trade in for rand - and would let me service international clients 2013-10-22 23:50:00 well, it would be appropriate for an internet age 2013-10-22 23:50:20 i like bitcoin, just wary of what govts are going to do 2013-10-22 23:50:48 your wariness actually gives you an incentive to use it the intended way: as a *currency* 2013-10-22 23:50:54 not as a speculative "investment" 2013-10-22 23:51:19 hold little of it, and use it the way you use real-life cash 2013-10-22 23:51:36 if i bought bitcoin it would be an investment seeing as none of the places i'd buy from accept bitcoin as payment 2013-10-22 23:51:37 then even if it crashes due to regulatory backlash, you won't lose much 2013-10-22 23:52:07 yes, unfortunately that seems to be a big part of why people get interested in buying bitcoin 2013-10-22 23:53:18 so it's an interesting avenue for a gambler or criminal, but not practical money at this point 2013-10-22 23:54:30 i wonder what will happen now that silkroad is shut down 2013-10-22 23:55:05 shutting down silk road kills a big piece of the "criminal" use of bitcoin; does that give the remaining bitcoin economy a credibility infusion? 2013-10-22 23:55:37 at the moment the people interested in bitcoin are going to be gamblers and criminals, not average people 2013-10-22 23:55:59 i'm pretty sure that's an FAQ somewhere 2013-10-22 23:56:19 and anti-govt types 2013-10-22 23:56:29 you already said criminals :p 2013-10-22 23:56:34 Yeah 2013-10-22 23:56:57 but yes, there are many libertarian / anarchist types in the bitcoin world 2013-10-22 23:57:09 it would change the world if it caught on 2013-10-22 23:57:52 banks stand to lose, but not as much as visa et al 2013-10-22 23:58:26 ok, being an IT guru, how secure is it, technically speaking? 2013-10-22 23:58:38 banks still have a core business that's independent of which currency is in use: knowing which loans to grant 2013-10-22 23:58:44 it's "virtual money" afterall 2013-10-22 23:59:12 i think the codebase is generally solid, but it's big and complicated enough that there inevitably are bugs 2013-10-22 23:59:28 what risks does that imply? what could potentially happen? 2013-10-22 23:59:31 the math behind it is solid, as far as i can tell 2013-10-23 00:00:25 think of it this way: there are $2b riding on it being secure; if there were big holes i think it would be awful tempting to cash out right now before others find the same hole 2013-10-23 00:01:11 worst case: someone can craft a message that triggers some bug in your node that causes it to send all spendable coin to sergey 2013-10-23 00:01:13 $2b that you can't spend on anything most people want to buy 2013-10-23 00:01:20 true 2013-10-23 00:01:30 ok 2013-10-23 00:01:54 if i could "steal" $2b i wouldn't do it all in one go though 2013-10-23 00:02:29 ofc 2013-10-23 00:02:33 there are ways to mitigate the theft risk: brain wallets, cold storage (printing private keys to paper, storing it in a safe, deleting the private key (but not public) from your computer) 2013-10-23 00:02:48 yeah 2013-10-23 00:02:55 ok 2013-10-23 00:03:57 you could probably denial-of-service attack the bitcoin network 2013-10-23 00:04:35 and there's math risk: bitcoin uses elliptic curve crypto, which is fairly new and we aren't reeeeeally quite as confident about it as other schemes 2013-10-23 00:05:25 but elliptic curve crypto is a big enabler; if you had to rely of the tried-and-trusted schemes you'd need a crapload more storage 2013-10-23 00:06:23 you'd need 100GB instead of 10GB to run a node; transactions would be 10x as expensive (since messages are longer, miners will demand higher fees to include your transaction) 2013-10-23 00:07:26 ok i see tips: 1DeKx6RgJ8Hd6sSJMWusgnpnmr6SVq3Fqe