Bitcoin Forum

1) "Anti-gay" Republicans can pay for male prostitutes anonymously.
2) Donations to campaigns can be hidden.
3) Oil Companies can buy congressmen more easily and with less public knowledge or interference.
4) The Pentagon can "unaccount for a.k.a. lose" billions of dollars more efficiantly.
5) Total National Deficit can be hidden.

Added 2 more:

6) The wealthy no longer need a swiss bank account.
7) "Tax cuts" for everyone! Yay!

Gives them more reason to further regulate the internet.

The CIA can fund supportive groups and governments.

The defense industry will be first to benefit.

The fed will kill fewer cotton plants since they wont be printing any more dollars.

US goverment can change one fiat currency to other.
Than they can sit down and smile to outrage on deflation - "You did not like inflation, so we decide to try  another way".

8) The NSA has enough computing power to mint enough bitcoins for all the US government's short-term needs.

One of the biggest misconceptions of bitcoin is the level of anonymity.  Cash is FAR more anonymous than btc.

btc is actually more of a blessing for govt. that want's to control people and understand what they're spending their money on.  In all I believe btc to be a huge win for despot/communist/fascist govt. all over the world.  The only thing they lose, is the ability to artificially inflate the currency, but maybe they'll give that up with the insight they get from every transaction.

Not necessarily. Generated bitcoin have no transaction history and would be very difficult to link to an identity. Same with an individual that never publicly publishes an address that can be linked to their identity.

Also, cash cannot be transferred over long distances as easily as bitcoin.

Sure, but how long will these 50 btc block remain stale.  If the currency takes of some of the initial transactions will be mostly anonymous (I doubt this, because I know of dbs that have been tracking ip address of connections etc.), but as they get used (is that what they're for) slowly we'll be able to track a btc and it's journey through the btc economy.

Put it this way...

When the DEA kicks in the door for a major drug bust, they get a list of btc addresses used for drug transactions.  They can now go into the blockchain and look at every address that sent money to these accounts, and possibly track down the users.

If the DEA found cash.... well.... unless your fingerprints, or the bill was marked, they aren't going to tie the cash back to the users.

Make sense?

I don't follow...


They can see addresses, but that does not necessarily help them turn those addresses into identities.

Let's say the drug dealers used address A. They could see a transaction from B to A, and C to B, and D to C, but unless there is some link between a person's identity and one of those addresses, the transaction history is no help.


Federal reserve notes have serial numbers, which may be recorded when placed into an ATM. Perhaps they then look at which bills with withdrawn by which account and/or retrieve ATM video footage. Or maybe I've been watching too many police shows.

Anyway, I agree that bitcoins may be easier to track sometimes, but that is not necessarily true in all cases. If a person knows what they're doing, they can fairly easily obfuscate or completely erase their financial tracks.

recording a small serial number from a blurry, black and white, 480*360 camera? good luck.

No, I meant that the bank may record which bills were placed into which machine. Then, the police do a reverse lookup on the serial number, finding the bank. The bank then tells police which ATM they were last placed in and the police watch the video camera footage from the ATM to see who makes withdrawals. I think I actually saw this on Castle, so I'm not sure if it's viable or not.

If bob pulls cash from the ATM (let's pretend it's fully tracked and monitored) and then a 20usd bill of his cash is found in the big DEA drug bust, Bob has plausible deniability.  All he has to tell the cops is that he used that 20usd to buy his daughter some ice cream from the ice cream truck earlier in the day.  Case closed.

With btc Bob does not have plausible deniability, because every single BTC transaction is documented.

I find myself spending a lot of time trying to pull people away from a vision of BTC that they want to be true, versus the reality of it.

Without even realizing that your vision of Bitcoin is not the same as the reality of Bitcoin either. Impressive!

OK I'll bite.  What am I missing?  What have I said that is inaccurate?  Instead of taking a pot shot at me, why don't you educate us?

This is what you are missing:


The block chain records transactions between addresses, not identities. How will they prove that the address belongs to Bob? In fact, why will they even think that the address belongs to Bob?

I was trying to keep the example simple.  You haven't taught me anything new, except to ask me more questions.  Here are methods someone could attain btc with their identity involved:

mtgox account --> personal account --> drug dealer == busted
btc faucet --> personal account --> drug dealer == busted

do the above two examples with cash and you end up == NOT BUSTED (plausible deniability) (there are many more examples and I'm sure you can figure them out)

There are many methods one can use to protect their identity while transacting in btc, but to the average user who just wants to buy some drugs, they are much safer using cash.

lol, suddenly that theory about the government being the one who made BitCoin doesn't seem so crazy.

If I buy something from someone's website using BTC and they mail it to my address, the authorities could subpoena the seller to release my bitcoin address and then they can connect me with the address, yes?

Yes, except they could do the same thing if you used a credit card, except with less hassle.

Ah, but I can use a credit card with less hassle than bitcoin in the first place. To which someone will reply with "but with bitcoin no one can inflate the currency or control it". And I will reply with, "what's the point of using a currency that people only invest in so they can get rich quick, can't use to pay their bills, isn't any more anonymous than cash, and constantly deflates so much that if you actually USE bitcoin to sell products, you have to re-adjust your prices every 2 days because the value changed so much over the last 48 hours."

This is utter bullshit. Some people may be speculating on a short term increase in exchange rate, but I doubt many.


Yet.


Cash can't be transmitted digitally.


Nope, the supply of bitcoins is constantly increasing (around 7,200 per day).


This is only due to the demand for bitcoins outpacing the supply, causing an increase in the exchange rate. The same thing happens in any market that spans more than one currency.

This is only a problem while businesses expenses cannot be paid with bitcoins and/or the demand for coins exceeds the supply. Once both of those conditions are no longer met, the exchange rate will either equilibrate or will no longer be necessary to determine price denominated in BTC.

In that case, thank you for replying, you've resorted my faith in Bitcoin.

The government will be many years behind Bitcoin.  However, why can't they simply start mining for themselves?  Over time, they can simply process transaction fees, when means they will essentially be collecting taxes on transactions.

Bitcoin will benefit the US government by collapsing it into a steaming heap of rubbish, ready to go into the landfill of history.

Umm ...and how does that exactly benefit the US?

The question is: why bitcoin should benefit the US government?

What do you mean "why"? Because Bitcoin can be a useful tool, for good and for bad, for individuals and for government agencies.

more harm than good ... creative destruction.

Sometimes the optimal path (path of least resistance) is the "Reboot" button.

Implying that the US Government is beneficial to the US...