Bitcoin Forum

It would change your analysis to be that Bitcoin is a practical implementation of a system that may suffer from the Two Generals Problem.

Bitcoin will simply mind its own business, as we work towards building a better way to store wealth and exchange payments with each other.  If central banking or fiat currency becomes less relevant during this process, then this is just technological evolution at work.  

I wrote this post in response to Paul Krugman's latest "Bitcoin is Evil" piece (http://krugman.blogs.nytimes.com/2013/12/28/bitcoin-is-evil/?smid=tw-NytimesKrugman&seid=auto&_r=1&).  In Dr. Krugman's post, bitcoin is referred to as "a weapon intended to damage central banking and money issuing banks."

This is not true.  Bitcoin is an experimental system that attempts to solve the double-spend problem in a trustless manner.  As SheHadManHands notes, it is a practical implementation of a system that may suffer from "the 60 year problem in computer science, known as the Two Generals' Problem. It enables a decentralized network to achieve consensus on a ledger of assets, without requiring any trust between parties."


I propose we take the high road as we move forward with bitcoin.  Here's what I mean:  If you say bitcoin is a weapon designed to damage central banking, you sound angry and hostile.  If you say that bitcoin is a ground-breaking peer-to-peer electronic cash system, and politely discuss that its widespread adoption may make existing financial systems less relevant and motivate governments to re-think antiquated tax laws, you sound intelligent and open-minded.  

I propose we take the high road as we move forward with bitcoin.  Here's what I mean:  If you say bitcoin is a weapon designed to damage central banking, you sound angry and hostile.  If you say that bitcoin is a ground-breaking peer-to-peer electronic cash system, and politely discuss that its widespread adoption may make existing financial systems less relevant and motivate governments to re-think antiquated tax laws, you sound intelligent and open-minded.

I think you're taking the opposite of the high road by saying it wasn't meant to damage central banking, etc. That's just pure BS.

No one is expecting it to topple governments or replace the almighty dollar.

You know how when you're travelling, you can use a VISA anywhere in the world?

Same difference, just better.

a lot of people are.. and they are probably deluded.

That's incredibly naive.

Central banking and the people who control it are at war with the rest of humanity, or at best see everybody else as subjects to be ruled over or livestock to be harvested.

The clash between Bitcoin and central banking will be violent, not because Bitcoin is violent, but because they are ready, willing, and able to bring violence against anything that threatens their monopoly.

Why do you think Krugman said "The US Dollar is backed by men with guns"? That wasn't simply a quip - it's as clear and honest a warning as you're going to get from them.

You're not talking about fundamentally honest people who will gracefully step aside when something better comes along - these are ruthless mafiasos who don't care who they have to crush to maintain their position.

The only problem is they don't have the skills to combat a technological phenomena like Bitcoin themselves, so the determining factor will be how many programmers defect and sell out compared to the number that won't. It's a human resources game now.

It is not BS.  That would be like saying the automobile was intended as a weapon to damage the horse-and-buggy industry.  That sounds angry and scared.  

The automobile was intended as a better way for people to get from point A to point B.  The fact that it put buggy-whip manufacturers out of business was just the natural evolution of transportation technology.  

The automobile did not *attack* the horse and carriage. It simply did its own thing and people adopted it because they thought it was better.  

I think you may be mis-interpretting my post if you call it naïve.  I agree with most of what you just wrote.  But you proved my point when you said "not because Bitcoin is violent."

Bitcoin isn't intended as a weapon to attack/fight anything.  Bitcoin is a way to opt-out of the current monetary system and support something that (at least I feel) is superior.  Sure, maybe vested interested within the current monetary system will fight bitcoin, but that doesn't mean that "bitcoin is intended as a weapon to damage central banks."  If central banks chose to fight bitcoin, it would just reveal their insecurity.  

What I'm saying is that if Paul Krugman says that bitcoin is intended as a weapon to damage central banks, then he looks like angry and afraid (and a bit tinfoil hatish too).  If Paul Krugman says that the US Dollar is backed by men with guns (and that that's a good thing), then he looks like he supports violent oppression.

So, again, if we say that bitcoin is a ground-breaking peer-to-peer electronic cash system, and politely discuss that its widespread voluntary adoption may make existing financial systems less relevant and motivate governments to re-think antiquated tax laws, we sound open-minded and non-violent.

I'd call it a defensive weapon, but that might be quibbling.

With regards to the marketing aspect, I agree that not characterizing Bitcoin as revolutionary technology helps avoid disturbing the delicate sensibilities of relatively wealthy and comfortable first world users.

I think we're on the same page now.

Bitcoin isn't intended as a weapon to attack/fight anything.  Bitcoin is a way to opt-out of the current monetary system and support something that (at least I feel) is superior.

Your point would be only true if Satoshi wanted just to create another payment method. But he didn't. Just address his quote or you're just being ignorant and/or naive of his mindset.

I'm not sure about that.

The people you want to placate are the people I'm more than happy to jettison the instant pleasing them threatens the long term viability of Bitcoin or undermines its potential to help the people who need it most.

My point again was if you say bitcoin is intended as a weapon to damage central banks like Paul Krugman did, then you are using loaded words to appeal to people's ideology and preconceived belief system.  Sure this may be good marketing in Egypt and bad marketing to the US upper class, but in both cases it's equally disingenuous.  

If you say that bitcon is better money because A, B, and C, then I think you are being more genuine.

How about we change "intended" to "can be used as"?

He chose words that associated bitcoin, and thus also the people that support bitcoin, with certain motives, political leanings, and ideology.

This is only one paper but FENCEN could ban BTC because it could be a danger for the supremacy of the dollar .

First China then some other countries and if FENCEN does it what will happen to the BTC in term of valuation ?

Honestly the BTC bubble wasnt good at all for this experience + until BTC is under high speculation BTC has no interest for E-com .

Just an opinion ....

"It doesn’t matter much to the idea of cryptocurrencies whether Bitcoin or its many emulators boom, zoom and crash, there will be cryptocurrencies from here on and they will flourish."

Let's not pretend that this is not disruptive but let's not pretend that somehow it is unfair for people to freely trade with one another.

My view is that BTC just showed system which is to perfect for banks to accept it.
They know BTC is just start for this race, but one day fiat and central bank will become useless.
You can buy now normal items from silver,gold, phones to cars and homes for BTC.

Small fees, no taxation and no problem someone will look in to your pockets(bank account) and have tools to block you from using funds will make BTc and other crypto really big player on financial markets.

Subways accepting BTC, bitgild and others. sky is the limit this days.

I agree with everything except the no taxation part. The most fair tax is a value added tax. If a sovereign nation creates a cryptocurrency and "code" in it the VAT and only return it in cases where it does not apply, this suddenly makes every transaction in a network 100% taxable by the government. (unless people just traded private keys). This technology could be used to make an excellent currency on behalf of a nation.


A value added tax is the fairest of all taxation methods. Rich and poor alike pay the exact same tax. A tax like this in conjunction with universal basic income can create utopias. This technology could make this happen.

Bitcoin will simply mind its own business, as we work towards building a better way to store wealth and exchange payments with each other.  If central banking or fiat currency becomes less relevant during this process, then this is just technological evolution at work.  

I wrote this post in response to Paul Krugman's latest "Bitcoin is Evil" piece (http://krugman.blogs.nytimes.com/2013/12/28/bitcoin-is-evil/?smid=tw-NytimesKrugman&seid=auto&_r=1&).  In Dr. Krugman's post, bitcoin is referred to as "a weapon intended to damage central banking and money issuing banks."

This is not true.  Bitcoin is an experimental system that attempts to solve the double-spend problem in a trustless manner.  As SheHadManHands notes, it is a practical implementation of a system that may suffer from "the 60 year problem in computer science, known as the Two Generals' Problem. It enables a decentralized network to achieve consensus on a ledger of assets, without requiring any trust between parties."


I propose we take the high road as we move forward with bitcoin.  Here's what I mean:  If you say bitcoin is a weapon designed to damage central banking, you sound angry and hostile.  If you say that bitcoin is a ground-breaking peer-to-peer electronic cash system, and politely discuss that its widespread adoption may make existing financial systems less relevant and motivate governments to re-think antiquated tax laws, you sound intelligent and open-minded.  

https://en.bitcoin.it/wiki/Genesis_block

http://libbitcoin.dyne.org/doc/blockchain.html#message-from-satoshi-bitcoin-s-creator

// The Times 03/Jan/2009 Chancellor on brink of second bailout for banks

Whether Satoshi sat down to create an explicity weaponised technology is up for debate.

While the security technology is very far from trivial, the "why" was by far the biggest stumbling block -- nearly everybody who heard the general idea thought it was a very bad idea. Myself, Wei Dai, and Hal Finney were the only people I know of who liked the idea (or in Dai's case his related idea) enough to pursue it to any significant extent until Nakamoto (assuming Nakamoto is not really Finney or Dai). Only Finney (RPOW) and Nakamoto were motivated enough to actually implement such a scheme.

The "why" requires coming to an accurate understanding of the nature of two difficult and almost always misunderstood topics, namely trust and the nature of money. The overlap between cryptographic experts and libertarians who might sympathize with such a "gold bug" idea is already rather small, since most cryptographic experts earn their living in academia and share its political biases. Even among this uncommon intersection as stated very few people thought it was a good idea. Even gold bugs didn't care for it because we already have real gold rather than mere bits and we can pay online simply by issuing digital certificates based on real gold stored in real vaults, a la the formerly popular e-gold. On top of the plethora of these misguided reactions and criticisms, there remain many open questions and arguable points about these kinds of technologies and currencies, many of which can only be settled by actually fielding them and seeing how they work in practice, both in economic and security terms.

Here are some more specific reasons why the ideas behind Bitcoin were very far from obvious:

(1) only a few people had read of the bit gold ideas, which although I came up with them in 1998 (at the same time and on the same private mailing list where Dai was coming up with b-money -- it's a long story) were mostly not described in public until 2005, although various pieces of it I described earlier, for example the crucial Byzantine-replicated chain-of-signed-transactions part of it which I generalized into what I call secure property titles.

(2) Hardly anybody actually understands money. Money just doesn't work like that, I was told fervently and often. Gold couldn't work as money until it was already shiny or useful for electronics or something else besides money, they told me. (Do insurance services also have to start out useful for something else, maybe as power plants?) This common argument coming ironically from libertarians who misinterpreted Menger's account of the origin of money as being the only way it could arise (rather than an account of how it could arise) and, in the same way misapplying Mises' regression theorem. Even though I had rebutted these arguments in my study of the origins of money, which I humbly suggest should be should be required reading for anybody debating the economics of Bitcoin.

Sure, there's a bit of room for ambiguity, but not much

I am surprised by the comments I'm receiving.  One thing that surprises me is that some people have actually framed me as a supporter of central banking and fiat currency, as well as someone who does not appreciate the power of bitcoin.