Bitcoin Forum

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People stop using drugs and heavy artillery  ;D

Bitcoin grows too fast. 

Of the options provided, becoming a store of value seems the most likely, however i would not consider that a fail, because as a store of value it would also, in my imagination, be a currency just kind of a different 'tier' of currency.

Of course I would not want to clutter up the Bitcoin blockchain with tiny transactions well within what I can afford to pay from my bitNicKeL pocket/purse, heck I would not even bother the Martians with such trivia by using Martian BotCoins instead of pocket change.

But come the day I have enough MBC to stash away that they could buy a whole Bitcoin, heck yeah I'd like to pick up another BiTCoin to enhance the family fortune, maybe even use that as collateral to pick up a nice income property...

-MarkM-

I think you need to add "a new system emerges", ie. not one that is necessarily better than Bitcoin inherently, but more practical and appealing to law abiding citizens (I'm thinking Google mobile payments and the like)

Why don't you have the most obvious one: lack of merchant support. If people can't use it to buy and sell stuff they care about from vendors they want to deal with then it's not going to get where it needs to go.

lack of interest is what all the other ones lead to

Bitcoin becomes hopelessly tied to extremist ideaologies that are rejected by a majority of people. The only people to adopt it are extremists, scam artists, and those trying to make a quick profit off of the fringe types. Bitcoin officialy becomes the "currency of teh crazy." Widespread adoption fails.

Bitcoin could fail if governments stop interfering with mutually voluntary transactions:

http://economicsandliberty.wordpress.com/2011/06/22/bitcoin-a-new-commodity-created-to-serve-market-demand/ (http://economicsandliberty.wordpress.com/2011/06/22/bitcoin-a-new-commodity-created-to-serve-market-demand/)

Not likely to happen though... :)

Hmm, not a lot of merchant support for gold, silver, or stock certificates...

None of the above (https://forum.bitcoin.org/index.php?topic=5227.msg147361#msg147361).

Two of my expected bitcoin failure modes are listed, but not the one I think is most likely: we will learn how insecure the average computer really is. Until now, they was no direct way to steal money from somebody's equipment.

Aside: I have noticed that over the past few years, the big computer companies don't sell computers anymore: they sell "solutions". "Computer" has become synonymous with "machine running Ms Windows" with all of the extra hardware that implies.

Someone with loads of coins continually cashes out and keeps the BTC worth pennies until long after everyone has lost interest in the project.

That's right - no one runs around buying/selling stuff with those either today.

People are apparently most worried about bitcoin a) being perceived as useless b) being overtaken by a competitor.

Interesting that exploits are less of a concern. Given the user composition of this forum vis-a-vis
the likely composition of people who may adopt bitcoin soon, I would expect the exploits categories to be over-represented
and the useless/competition categories to be underrepresented.

Perhaps uselessness and competition are the big issues.

Though I wouldn't call gold, silver, or stock a "failure"

Journalists that keep wanting to buy in, using their pull to disrupt the prices by making things up so the price goes down. They see it as wallstreet 2.0 and the only sure way they know how to fuck with it is through disturbing things.

It's like we have to just stop everything for a few days just to let them numbskulls in.

network take over ...

yeah sorry I know most people here think that is impossible but I'm pretty sure that with 2M$ at hands, I could do that.

Disinformation. Because we let the current media outlets do the talking for us when we have the power of the internet.

Wrong paradigm. Instead of assuming the death of bitcoin (in one or another form) one should ask of how fast and furious shall bitcoin’s success be. Look at those charts: total number of nodes (http://stats.bitcoin.it/rrd/nodes_total-year.png), total number of google searches (http://www.google.com/trends?q=bitcoin&ctab=0&geo=all&date=all&sort=0), total network hashing rate (http://bitcoin.sipa.be/).
Now extrapolate them to the future. It is encouraging, isn’t?

People are already working on a client that splits the private key between a secure server and your computer.
Other people are working on secure liveCDs.

This won't be an issue long term. Hardly anyone is going to store a wallet.dat file on their windows machine 1 year from now.

i have read that if someone has more than 50% of all the hashing power on the network they could essentially start screwing with the system and destroy it. if this is true i don't understand why smart people who know a lot about security such as steve gibson don't acknowledge or talk about this?


obviously it would take a lot of effort/money that probably only a government could pull off. but isn't it possible and if it is possible why don't people talk about it more as it seem to be the only real threat to bitcoin.

As far as we know there is no super-computer exists today that can play this game anymore.
I don't want to give false sense of security though. The risk exists. For any private entity who can beat network's hashing capacity it would be more profitable to mine instead of trying to corrupt the blockchain. Any pool close to or over 50% poses risk of being hacked for instance and screwing the system. Don't know what to say about authorities - would they want to screw with it in such a way instead of simply trying to outlaw it if they deem to do so.

you don't need a super computer

the power to do this can be purchased and set up. probably costing several million dollars but this amount is a joke to a government.

outlawing it would have no effect. they would have to destroy it to stop it.


for an example of what i mean, look how effective outlawing drugs has been.

Already discussed here:

Bitcoin's kryptonite: The 51% attack
http://forum.bitcoin.org/index.php?topic=12435.0

And 50% is not a magical number, hashing is a probability issue. For an effective sustained attack, you would need a high percentage of hashing power though.

thanks, i'll start reading it

Right now you dont need a government, only a couple of tens of millions of dollars.

To put that in perspective, only in the USA right now, there are 1 million people that have a net worth of more than 10 million dollars. If a handfull of those wanted to harm bitcoin, they could.

Also the supercomputer argument is a known fallacy. Its a catchy phrase but does not make bitcoin less vulnerable to brute hashing attacks for the moment. The supercomputer argument is debunked in the thread above.

right, i should have said either a government or a person/corporation with substantial funds could do it

I think you're confusing the Democracoin idea someone posted here last night and Bitcoin itself.

Bitcoin cannot be screwed with in such a way.

Of course it can.

i don't see how people don't discuss this more. it seems to be a fatal flaw in the whole system.


people talk about how the guy who wrote all this stuff solved all problems with it but he didn't.

I'd rather see the number of Americans with LIQUIDITY in excess of $10 million.  Net worth factors in long term, illiquid assets.  I get your point though, I just think you're using the wrong metric.

It is a problem in fact. The only way bitcoin can survive in the long term, is with governments or powerful organizations protecting it. We should wake up to that reality.

This, of course is not an impossibility. In fact I see many governments allready supporting bitcoin indirectly.

I am not using the wrong metric. You can convert any asset to money given enough time. I am not saying they have to make an attack within a certain deadline. And I am being conservative, because you could even get a loan to make the attack, so even more people would qualify.

It's just that net worth is a figure that's easier to fudge.  Cash is cash.  Assets can be over valued on a balance sheet or liabilities can be under valued.  I'm not really trying to argue with you, like I said I get your point, I'm just saying liquidity is probably a better measure as to someone's capacity to destabilize a market.  Good point about using leverage.

Yes, I get your point too, and I agree, but the problem is that liquidity is also a relative metric. Assets can be more or less liquid, but there is no precise cut line for "liquidity".

The two scenarios that worry me are
1) bitcoin dosn't scale. I know i should do and I know that work is being done in this area. Ive also seen other systems that should scale fail when it came to doing it for real.

2) consolidation of hashing power. The top two mining pools combined have over 50% hashing power. this gives them too much influence. I'm not talking about straight double pending attacks but more general power and influence over the project.

Did mods just deleted an ongoing thread called "Biggest Bitcoin threat" or something similar?

[Mod edit: It was merged into this one here: http://forum.bitcoin.org/index.php?topic=25026.0]

Hugolp, a pm to the participants of an ongoing thread that suddenly dissapears would be polite. I lost 15 minutes and had to pm theymos to find out that you deleted an ongoing thread and merged it here.

This  ;D

you forgot an option...

-assholes, thieves and incompetence

You guys talking about government + 51% threat are forgetting one VERY important thing:

Paper money does not compute hashes, no matter how big your pile of money is.
For the government t put those millions of dollars to work to destroy Bitcoin, they first need to actually buy or make A LOT of computing hardware. Too bad for them, almost all good hashing ATI cards are sold out around the world, and we miners aren't willing to part with ours :D

I find it extremely humorous that the majority here think a slow death is the most likely outcome.

dream on ... said it a million times but will do it again: imagine new pools showing up that offer you 10% more than all the others, greedy miners will happily join those. once these pools reach the size of other pools, they can attack those by mining for them delivering shares but no blocks.
once those malicious pools have a combined 50% of the miners the other pools will get invalid blocks driving more miners to the bad ones. and who's the one to decide which pool is not malicious? and what greedy miner will not mine where he gets BTC, relying that others will make those BTC valuable again in the future?

I believe the bitcoin as is will fail due to greed not supporting the network as it was intended by pools controlling what gets in the block and pools controlling who gets to see the block at what time.

Is there any pool that I can mine for, but still manage all transactions and maybe even the reward? following some rule: if i give only 25% of the reward to the pool, the pool counts that share as a 25% share? This way I could mine for several pools with each share and once I find a block I want to directly broadcast it and not leave that part to the pool. This would also diminish the vulnerability for above described attack as the miners for the bad pool publish their blocks independently of the pool so it can't hold it back.

Indeed, the long term is going to be largely dependent on the degree of 'official' sanction.

True, Bitcoin could go rogue (which would be fine and dandy with many current Bitcoin folk), but the masses will sheeple in the direction they are told.

HOWEVER, if (or as many of us believe, when) world currencies collapse, then all bets are off and Bitcoin is setup to be THE game in town.

The most probable thing is:

General lack of interest leads to slow death

What will cause it to fail are all the things happening now:
- lack of easy security if stored on one's own machine (people's machines are being hacked just for bitcoins)
- lack of security + extra costs if stored online (web sites exploited, fees - I understand all commerce has fees and exploits but if you want to start a new currency maybe kill the fees until it gets established; bank accounts are insured; credit cards defend against fraud)
- lack of security during trade (i send bitcoins but what if I don't receive my goods?)
- miniscule merchant support (where can I buy toilet paper, Doritos and Mountain Dew with my bitcoins?)
- too high cost to get into the market (It's fun to buy maybe 1 coin at $15 to tell the world "i own a bitcoin" but really? A bitcoin isn't worth anything beyond a novelty to the average person until many of these issues are resolved)
- exchange rates seem easily manipulated so that even speculators remain unwary

It would be pretty neat to see Bitcoin mature and succeed. But whatever happens its been interesting to watch. People are always entertaining. I like the folks that talk about total currency collapse and government meltdown as if in anarchy there would somehow be a concern about computing or even the ability for people to generate electricity on the scale that would allow an electronic currency to remain viable. LOL, currency in those situations would be more basic like food, weapons, sex, clothing. If Mad Max only had access to his wallet.dat file he wouldn't have had it so rough!

I feel in a similar vein: either loss of "investor" interest or "investor" alienation -> no business adoption -> long slide to almost-zero value. All the media attention when the economy wasn't really ready for it was just not good for business - hopefully we can push forth out of the funk, but it remains to be seen.

The next 6 months will be telling - people who are in it for 6 months are probably in it until the wheels fall off.