Bitcoin Forum

You know who I'm talking about.

"Bitcoin is a fixed currency! That means deflation! Deflation is the boogeyman! Therefore, we MUST create new bitcoins in pace with node growth and maintain price stability!"

"I don't like how feature X is implemented in Bitcoin. I'm gonna fork the project and who cares if the current nodes get confused!"

"Bitcoin is prone to speculative attacks! Therefore, we must prevent one node from accumulating too many bitcoins in order to maintain price stability!"

I could go on and on...

In my opinion, since unlike government fiat currencies, Bitcoin is entirely voluntary and not obligatory, the moment someone tries to make Bitcoin behave like a fiat currency, it will lose all value and all holders will have their holdings wiped out. That should be reason enough not to intervene, but people will still have their arguments and try...

BitCoin already has all the defense it needs: you can't change the core behavior of BitCoin and still be compatible with the "official" BitCoin software.

What determines this compatibility? What if some people decide to fork the software? For now, Satoshi more or less has Bitcoin under his control, but what happens if/when popularity explodes and anyone can edit the code?

This is not a criticism of the open source model; I am just uncertain of what happens once you start having a proliferation of different clients. The changes don't have to be radical, they could be subtle and subversive.

If you edit the code and it changes the core behavior, then all other nodes will ignore you unless they're also running your code.

Other nodes don't have to accept your transactions.. but many will want to use the official well behaved software anyway so there should always be some people who will accept them.

I think it's similar in some ways to web browsers - a web site author wants you to see a bunch of ads so he created something that uses javascript and opens pop under ads.  You're using a browser that doesn't have javascript so you don't see the ads.. but then he has this cool page that lets you pan a webcam around and it uses javascript but you can't use it.  So maybe you outsmarted the system by avoiding the ads but you end up losing out on the webcam panning page so you're just hurting yourself with your modified browser.

There are similar things you can do in bitcoin but I think the author has designed it to be pretty well protected against the kind of things that would allow someone to subvert the whole system or profit from it.  You might reject everyone's generated coins and not include them in your blocks, but it doesn't make you any richer, and some other nodes will accept them anyway.  You can send garbage and find ways to crash them but then those nodes will just blacklist you.  These protections will be implemented as needed I think, since it's hard to know ahead of time what types of things to protect against.

BitTorrent clients are a good example to look to - they disconnect and blacklist clients that are sending them bad data.

The majority of the network will likely always be comprised of cooperative nodes.

Maybe someone could start a bitcoin insurance agency that has secure vaults behind tor or on freenet that you could back your wallet file up to.
To access the file the insurance agency could provide  virtual tokens (https://www.sestus.com) to the customer that are resistant to man in the middle attacks and for the ultimate in authentication.If your wallet was lost in this scenario the insurance agency would cover the loss.The chance of losing losing your wallet would be pretty close to zero if you stored it like that.

Is it possible to write a script for bitcoin that extracts the wallet file and automatically gives you the option where you want to back it up to?This could be useful for new users who may have difficulty finding where the wallet file is located.Hey ,its the little touches that make things great. :)

a backup feature is a good idea and easy to implement.

Satoshi does have Bitcoin under control right now.
We might consider enforcing a "we only support official clients" rule in the future, if there's some sort of Bitcoin fork, ofcourse.
I'm not talking about an entire different genesis block, but a fork that adds features or modifies behavior.
But I'm talking about a fork that has its own website, uses the same genesis block the network's using right now, etc.

(And I'm defiantly not talking about custom SVN builds here, Hi there Laszlo! :P)

That's impossible to enforce at a technical level.

As far as I can tell from general poking around the way bitcoin works is set in the protocol that the nodes talk to each other. Simply puy to change the way bitcoin works you'd need to fundamentally change the protocol bitcoin uses to talk to other nodes. When you change the protocol it uses it can no longer talk to other normal nodes. There is one other way to change the amount of coins in circulation however, the dev(s) have a key that lets them print money. odds are good the dev(s) will make a shit ton of coins from this and not delete the key. unless someone somehow gets the key then you can't add new currency technologically.

How does that work? As far as I understand it, new bitcoins can be generated only by creating a new block, 50 BC at a time (for now). If the devs have some way to generate new bitcoins quickly, that would pretty much defeat the purpose of having P2P network with no central authority. Instead of trusting banks, we would have to trust the devs.

I second this, if you don't trust the developers? Get the source code, read it and compile it yourself!

I assumed that we were getting the blocks to solve from a central authority and when I computer solves that block it turns into money. I am probably wrong.

The blocks are just random data - the only purpose of the hashing and block generation is to limit supply and provide a way to arbitrate double spending.

No, block is (as the FAQ (http://www.bitcoin.org.nyud.net/faq#What_is_a_block) says) just a sequence of transactions that happened since the last block was created plus a transaction that gives you the newly created bitcoins. It is just made so that creating this block is quite difficult. There is no central authority in the whole system (apart from an IRC feed used only to get other people's addresses).

What is to prevent the government (or even a corporation like amazon cloud) from converting a bunch of its super computer clusters into producing bitcoins, thereby diluting the value of eveyone's bitcoins?  I guess basically we need enough regular people producing bitscoins to counteract any central organization of producing a majority of bitcoins.  And I guess that overtime, the cost of producing bitcoins will approach the actual physical cost of computer energy and hardware and the opportunity cost of doing something else useful.  I'm sorry, I'm a newbie!  Just trying to think this through out loud.

Every 2014 blocks the difficulty is automatically adjusted so that at the average hashing speed of the last 2014 blocks it will take 2 weeks to create the next 2014 blocks.

What this means is that if you load 1000x more computing power into hashing than the rest of us combined you will get nearly all of the remaining 2014 coins until the reset, but then even at your phenomenal speed the next 2014 will take you 2 weeks. Only about 2 blocks will be generated by other people, but you won't generate anymore than all of the blocks. Now if you could increase your power 1000x every 2014 blocks for a long time then yes you could get a lot of blocks. You are still going to run into the halving of coin awards and are absolutely maxed at getting the rest of the coins that will ever be created, about 17.5M more.

Anyway, the point is that if you hold 21 BTC you will never have fewer than 1 millionth of the coins, no matter how fast your computing is or how fast your computing speed increases.

2016.  Other than that, yea.

Possibly related though: Can the bitcoin project survive if Satoshi is hit by the bus tomorrow?

Yes, all the source code is available, anyone can compile the client or modify it, fork it, etc.

I meant an orderly succession, not a thousand forks of bitcoin.

If Satoshi disappeared today? Then those that worked with him and wanted to put in the effort to run the project would be the natural selection logically. Otherwise, it just rolls down until someone wants to take charge. If that failed, I would considered heading the project myself if no one else was left that wanted to.

The more evil thing may happen if Satoshi start to have evil intentions and will start to manipulate the rules.
Forking the code will not help Bitcoin system to sustain.
Do you personally know him?
Do you meet IRL?
Do you know his mind?
Is he a real person :) ?
Haven't he dissappeared already long time ago?

The trust to the system depends on the answers to that questions.

Developers are the central authority of Bitcoin.
We all download the code produced by some single source - a group of developers.
Now we cannot decentralize the code development, developers must agree on some common rules for the system,
or the system will break.

http://bitcointalk.org/index.php?topic=547.0

Yep.
If they will notice, that the update contains some "wrong" rules, that will hurt their wallets, ofcourse...
But if they don't? Do you regularly read code updates :) ?
I don't, having a better things to do, like talking with you.
Would you notice that? Would you tell us then?
Would you prove to us, that the update was "obnoxious"?
Will we trust you :) ? Who are you :) ?
And, by the way, developers have the reputation, that gives them some authority, and there is http://en.wikipedia.org/wiki/Plausible_deniability to prevent losing that reputation.

The problem of the central authority arises with Bitcoin too.
Well, it will not arise, as soon, as development finishes and the rules in the code
become static and widely recognized and approved by majority.
But that moment is in the future.

Yes! That is what I am trying to say! Agreed with you!

No-one will be trying to "prove" to you or me why you (or me) must or must not run it.

And we will just continue to use it. That is an easiest way to intervene the project - just subtly intervene the code, so noone notices.
1. Hijack the hosting, that distibutes the binaries, and you will affect the majority of users, that do not compile by themselves.
2. Hijack the developers' workplaces, and you will get the ability to subtly affect the source code.
3. Hijack the source control system, and you will control the source and the binaries.
And don't think, that the "evil 8) powers" will be forced to do that via Internet access only.
Whenever the government comes to play, or the hugest businesses, then physically hijacking the servers is the cheapest attack on the Bitcoin.

Bitcoin as a payment system suffers from the threats to Bitcoin as a software project.
They are the common threats, not Bitcoin-specific, I think they are obvious to every opensource programmer.

Yes, there are some countermeasures to protect Bitcoin as a payment system from such attacks, like developing a standard first, not a software. But AFAIK they are not deployed NOW, standard may change, and users cannot affect to veto the changes, unless they coordinate, which is, well, unlikely  without a sound reason.
That's all I can say.

And when people start noticing that it's been hijacked, they'll make posts on forums, and that general knowledge will pass by word of mouth and people will stop using it.

Just because we're not trying to "prove" to you that it's valid/invalid doesn't mean we won't say "Uhhhh, I wouldn't use this anymore."

As less people use the client, it will become less valuable to use.  Thus, the people who DON'T listen to word of mouth will have no point to use it.

So, let's start!

I have noticed, that Quantumplation's account on this forum is hijacked by some evil power, like chinese government, or some international banking corporation, don't know exactly. He advocates against the possibility of such event affecting the Bitcoin's security.

He-he.  8)

I suppose, that in the future, the user base may outgrow the developers community, making it more feasible to attack Bitcoin users by attacking Bitcoin by attacking it's codebase and standards base, for example, by hijacking the developers.

I wish it never happens. But what prevents that, except it being my paranoia?

And I've noticed the user throughput (http://bitcointalk.org/index.php?action=profile;u=574) trying to disrupt the Bitcoin community by making false claims about community members.  ;)

he's been hit by a bus?  :o

I find it fascinating how Bitcoin demonstrates how immense power can be wielded where there is a knowledge gap. The cleverest miners with the best technology mine the most coins for the lowest cost. Developers have a literacy advantage over non-developers. And the community as a whole appears to be several steps ahead of the financial kakistocracy :D

Do you mean Tyler Durden clever? Or do you mean Pirate Bay, MegaUpload, Wikileaks clever?

Lazy wording on my part. Presumably those guys are all busy on other projects and/or getting deported, so no. Strictly speaking it'll be a broad group, including but not exclusive to:
teens experimenting with their gaming rig because they heard about the "free money", engineering students borrowing FPGA kits, IT admins kitting out their server room at work, young parents running a start-up...

They may or may not be financially literate... But with various challenges being thrown their way, they can only improve.