It's possible to implement coinjoin that can be trusted, even if nobody deletes the logs.  You can secure it against the ability to associate inputs or outputs with each other, or with IP addresses, to an opponent using blockchain evidence, server logs, or realtime packet sniffing. 

The "tricky cryptography" is a stream cipher with multiple keys, each key being known to exactly two participants  (aka, a dc-net).  There is a requirement that there must be more than one honest participant in the "join" whose stream key is unknown to the opponent.   An opponent listening to packet traffic can associate inputs/outputs with any participant whose key that opponent has compromised, so if there is only one honest participant whose key is uncompromised, the opponent can associate inputs/outputs with that participant by process of elimination.

I'll implement it if nobody else has by the time I get around to it, but it isn't my highest priority right now; I have a higher-paying bounty to pursue in programming, which is (arguably) even more important to Bitcoin in terms of adoption and remaining decentralized, and that is to limit the size of the blockchain download needed to run a full node.

Already bought at USD$600.  Spent my whole investment budget for the current month.  I'm very happy with the purchase, and expect it to rise by 100% from current prices within a few months.

I just hope that if they go bankrupt and manage to crash prices to $400, they wait at least a month so I'll have budget to buy again.

I don't use social media.

I see people citing the existence of 'tipbots' associated with various social media channels as if they are important, but I don't know why they are important.

What do tipbots do?

Many of these 1-satoshi tx do eventually confirm, don't they?  They wiggle in eventually via the <100K "free" section most miners still allow?

Of course not.  See "Fiat Currency", definition.  I don't think Greenspan ever claimed it did. 

Bitcoin is a very peculiar value proposition.  Technically it's fiat, per the definition of having value as a medium of exchange unrelated to its intrinsic value if any, but it is not government fiat.  It's a community fiat.  It's sort of a throwback to "things used as money by mutual consent" like wampum, etc, as opposed to the modern definition of fiat which is almost exclusively taken to mean government fiat.

That much at least is simple.  You get the total movement of bitcoins from the blockchain, and divide by the number of bitcoins currently in existence. 

You make a very good point.  The things I'm thinking of as fundamentals don't provide me with any easy way to measure their contribution to the whole.  But, I'm guessing, that's normal for such an immature market sector.

As far as "value provided by trade", I start by looking at the amount contributed to bank bottom lines by their VISA/Mastercard operations divided by the amount of money that the transfer each month via those operations, and multiplied by the ratio of credit card to bitcoin transaction fees.   Then I multiply that by the amount being transferred monthly according to the Blockchain.   That isn't much, but I'm also looking at expected growth, so yes I'm putting a higher speculative value on it.

Here is a list of reasons why I have "expected growth" in my calculations.  Admittedly it's hard to know exactly *how much* growth to expect, ie, what fraction of the market bitcoin will eventually capture.  But we can see the size of the market for money transfer at least, so there's a (very high) upper bound.

I consider Bitcoin acceptance at major retailers that have stockholders and file financial disclosure documents and quarterly reports to be a major "fundamental" in Bitcoin's value.  Mostly because I think that when overstock.com came out in its quarterlies and said it saved $2 million on transaction processing fees by using Bitcoin as opposed to credit card processing, that both verifies a value case and demonstrates its reality to the rest of the world.  People pay attention to that crap.

I consider the proliferation of Bitcoin ATM's (now in dozens of countries) to be a major "fundamental."  It means, at the very least, that the owners of these coffee shops, convenience stores, etc, are finding it worthwhile to devote floor space and electricity to bitcoin trade.

I'm encouraged by the recent (absolutely, bleakly, dismal) quarterly reports of Western Union, the leading money transmitter for remittances worldwide.  To the extent that WU shrinks, something has to take their place.  And relative to that, Bitcoin under a recent agreement is becoming a service available at 7-11 stores throughout Mexico, which is ridiculously good positioning for the remittance market that WU is increasingly failing to serve.

I'm also encouraged by recent legislation in the EU recognizing Bitcoin as a form of privately issued currency, and guidance from fiscal regulators in the US clarifying its position relative to the US tax code.  These both remove huge amounts of risk and uncertainty for companies dealing in bitcoin.   I'm relieved by FBI memos that explain Bitcoin in neutral terms rather than regarding it as evidence in itself of criminal intent.

I'm encouraged by the shutdowns of Silk Road 2, Sheep Market, etc, demonstrating to legislators, law enforcement and everybody else that bitcoin isn't some sort of magic that permits criminal organizations to operate with impunity.  If it were, then there'd be far more risk of it getting banned in most of the world's economic markets.

I'm encouraged by the BTCChina reopening and subsequent lack of arrests.  I cannot make any grammatical sense out of their laws, but it seems BTCChina is either engaged in a legal operation or is getting a pass on it.  It's very clear that Bankers can't trade Bitcoin in China, but that apparently isn't as much of a crippling factor as we thought when we were being pessimistic.

All of this has happened *since* the most recent high.   So I see the way getting more and more clear for Bitcoin to become mainstream, while everybody is distracted by FUDsters and short-term events like the Gox attack.  

Dude, I did.  I bought three times in the last week.  But I don't borrow money to buy, and I don't spend the grocery money I'm going to need in the next couple of months.  I expect to be up 100% from this low within 3 months, and that's -- a completely stunning level of profit compared to most trading commodities.  Still, you're probably looking for someone with deeper pockets than me if you want serious market support.

The Gox/Malleability thing has provided a short-term price drop that isn't reflected by the fundamantals, and I expect that downward pressure to go away when the software gets fixed and the Gox issue resolves itself (regardless of how the Gox issue resolves itself).  This is  a textbook case of a short-term market shock, and I'm riding it.

Now, there may be another shock if Gox declares bankruptcy, but that isn't a long-term problem either, so if it happens I'll just ride that one too.

I think Greenspan was just reporting economic facts when he observed that Bitcoin's value is not intrinsic.

Bitcoin is bluntly not a physical object, therefore it has no "intrinsic" to be valuable.  It is a pattern of information, valuable only in the context of the Bitcoin network.

As for Krugman saying Bitcoin is evil, he's making the same category error that's made by people who think guns and knives and lockpicks are evil.  Bitcoin itself is not a thinking entity; as such it has no capacity to be evil or good.  It simply is.  I don't know whether he's speaking about the current community, or about the set of uses he himself imagines for it.  But whatever, it's irrelevant as a category error.

I think that because the problem is mainly about orphan risk, it needs to be addressed specifically via orphan risk.

consider https://en.bitcoin.it/wiki/Proof_of_blockchain_fair_sharing as a basis for a solution.

The premise is that the longer a transaction has been in existence, the more important it becomes to the acceptance of the next block.

Although the nodes may not all be looking at the exact same transaction list, if the numbers seen are similar, they should be computing a very similar 'credibility score' for the next block.  And if the 'credibility score' is too low, they ignore that block, mining on the previous block instead. 

This creates an orphan risk for *failing* to include transactions (specifically the oldest outstanding transactions) that balances the orphan risk for *including* transactions (and using up block space to do it). 

BDD = Number of bitcoin days destroyed
BD1 = Number of bitcoin days in fee-paid, nonconflicting tx 20 minutes or more old and not yet included in a block
BD2 = Number of bitcoin days in fee-paid, nonconflicting  tx 40 minutes old and not yet included in a block
BD3 = Number of bitcoin days in fee-paid, nonconflicting tx 60 minutes old and not yet included in a block
BD4 = Number of bitcoin days in fee-paid, nonconflicting tx 80 minutes old and not yet included in a block
etc.

So let
Credibility = BDD/ (BDD+ BD1 + 2^(BD2 + 2^(BD3 + 2^(BD4 + ... ))))

And if we find a chain is too 'incredible' (less than 0.000001 or so) we just ignore it and mine on a more credible chain (even if that  more credible chain is just the current 'incredible' chain minus the last block).  Because miners are looking at different tx pools, or may have learned about the same tx at different times, they may calculate different 'credibility' thus that some accept a new block and some don't.  But this shouldn't matter much because if 40% of the miners reject a block then that block gets a 40% orphan risk, which has a tangible cost to the miner producing it and gives the miners a strong motivation to avoid creating the kind of blocks for which that might be an issue.

This appropriately prioritizes fee-paid nonconflicting transactions that have been waiting for the longest time, and has the benefit of allowing the blockchain to resist a more-than-51% attack at least in terms of making sure that no one can keep a valid but unfavored tx *out* of the blockchain forever.

Does it cause a problem that initially rejected blocks can get brought into the chain via a reorg, when they become part of a chain that is, thanks to a later block that includes the tx it missed, more 'credible?' 

Bought @ 630 (didn't have access to Gox prices, as usual).   

I see this as probably having been the best buying opportunity in recent months. 

If a trader causes the price to fluctuate more wildly than it otherwise would, that trader is experiencing a loss.  So if you're mad at him, I guess you can take comfort in the fact that he knows he screwed up and it cost him money.

Sold while the price is falling?  He loses.

Bought while the price was rising?  He loses.  

I don't buy or sell more than once a month.  Well, okay, I bought twice in the last couple of days because the price has been STUPIDLY low with this mt.Gox scare.  But keep in mind that my buys supported the price when it is temporarily too low, and my sells if I time them right don't remove support unless the price is too high.  Because I like profits, I don't sell into lows making the lows worse, nor do I buy into highs making them higher.  

It is the weak-willed, socially-minded emotional holders who move with the herd (you have quite correctly called them "weak hands") that cause giant price fluctuations.  But those are not investors, they are merely speculators.

The investors who actually make money trading have thick skin, are uninfluenced by the crowd to the point of being almost antisocial, and make faint clanging noises when they walk.  When the headlines are trumpeting short term doom they're evaluating the page-20 story about infrastructure and legal frameworks to get a longer-term outlook instead of being distracted by being part of the "group mind" consuming the sensational.  They buy into crashes and sell at highs, contributing stability to the price.

I'm seeing infrastructure and support among merchants broaden.  In addition to overstock.com, I'm seeing places that run remittance services taking it up, I'm seeing it at 7-11's in Mexico, I'm seeing bitcoin ATM's popping up in places, I'm seeing legislative actions that specifically declare it to be 'a legal form of money' in California, etc. 

Crucially, I saw overstock.com's financial filings where they credit bitcoin transactions with saving them over a million dollars in credit card processing fees.  Other merchants are going to notice that, and they're going to follow where the money leads.

Right now the price hasn't yet reflected the good news because we're still dealing with bad news; Gox and the tx malleability scare.  But the bad news is all just one-week news, and the good news is all infrastructure and other progress that will continue to do the value proposition good for years. 

So, I'm reading the next week or maybe two as my buying opportunity; as soon as we go for a month or two without new bad news, I expect the good news will get noticed, and the new higher rate of use and acceptance to drive the price higher.  Momentum will take it briefly over $1500, with a drop back to around $1250 or so as the buying surge halts.

Of course I could be wrong.  So could anybody. 

I don't  know how broad the scope of it is.  I know that all the banks local to me (Northern California, USA) have started doing things that way. 

I don't know whether that's because the law now _requires_ it, because the law now _allows_ it, or because some regulatory agency is now incentivizing it or penalizing failure to do it, or because of a court precedent that makes banks less likely to get sued for it, or ....  any of a thousand possibilities.

Sometimes.  Sometimes they just find companies with a competing product that's blocking them from getting monopoly prices, buy them out, kill the competing product, and start charging monopoly rates. 

Remember, "More efficient" is not always globally more efficient.  Sometimes it means people pay more money for an inferior product, while simultaneously reducing the amount of that payment devoted to development of better solutions.  The only thing "more efficient" in this scenario is the rate at which the pockets of the investors get filled - and that only in the short term, since the industry is deprived of the progress in efficiency that comes with competition. 

Much argument about efficiency is really about points of view and timeframes.  That which is "more efficient" in producing return on investment in a single company in the next quarter is not usually the same as that which is "more efficient" in producing return on investment in an entire industry (or an entire economy) over the next ten, twenty, etc. years.   The social interest in efficiency is in the latter, long-term industry-wide or economy-wide view.  The capitalist's interest in efficiency is usually measured in the first view only.

Even within a single company, you get different efficiencies with different points of view depending on how much of their fortune someone has invested.  A coalition of Angel investors with 51% of a startup's stock, who have themselves invested only 3% of their own wealth into the startup, would rather pursue a 10% chance of absolutely dominating a market (and making 20X on their investment) than a 60% chance of just making a profitable company (and making 2X on their investment).  But the founder who has sunk every dime he's ever earned into this company, who will be absolutely ruined if it fails and doesn't have money to invest in anything else to offset the risk, has a very different view of the world.   He's looking at a company that could work just fine, and he knows it, and he is getting wound up and run into a brick wall like a crash test dummy instead, taking insanely high risks of failure.   The interests of the Angels and the founder are not in fact aligned, even though both succeed if the company succeeds. 

Just a random point. 

The only person authorized to deposit money into an account under the new rules is the account holder.  You can make a bank transfer, but he (or she) must explicitly authorize it ("deposit it") to get into his (or her) account.

I think the idea was to close the "I don't know nothin' about that deposit, where did that even come from?" defense for people who've gotten money from sources considered illegal.  There can no longer be a deposit unless you specifically authorize that particular deposit or you specifically authorize that particular person or business to make deposits directly into your account.  

Why should I have an explanation for that?  There's a chance it represented a failure of some software somewhere but remember this is also a very thin market in a potentially panic-inducing situation; it might just be a fluke. 

I think it's likely to be a fluke, in fact.  Somebody posted a "sell at any price" order in a thin market. Or possibly, he intended to put a limit of $1020 on the price, but fatfingered the data entry and missed the last zero.   Either way, he happened to hit a one-in-a-million hole where the buy offers higher than $102 had been fulfilled, and some clown who posted what ought to have been a "joke" buy order got ridiculously lucky. The seller is probably still beating his head on the floor. 

There is now a DDOS.  Presumably orchestrated by someone trying to exploit the GOX bug in order to drive the price lower. 

For a long time, Bitcoin protocol allowed transactions to be expressed in multiple different ways, yielding potentially several different Hashes /ID numbers for the same tx.

They fixed this many months ago so that the qt wallet and the command line client only ever issue tx in a standard 'canonical' format that has a single possible hash/ID, and the standard Bitcoin daemon won't forward or mine tx that have one of the noncanonical representations.

But Gox didn't fix their own software, and every so often Gox would issue a tx that didn't have the canonical form.  There were a couple of miners that still allowed these transactions to go into blocks, so the noncanonical transactions would be delayed while all the miners that didn't allow it got blocks, then finally go through when they got "lucky" and hit a miner that hadn't updated software.

A couple weeks ago, after many warnings, the Bitcoin network reached a threshold and the full nodes stopped accepting blocks that contain noncanonical transactions.  Miners that hadn't updated their software yet started getting orphaned blocks every time they included one of them, which happened about as often as Gox emitted them.  The bug at Gox bit their asses as payments made from Gox having a noncanonical representation were refused by the network. 

Keep in mind, at this point this is less than one one thousandth of the payments coming out of Gox.  Essentially it only happened in some small fraction of the tx where Gox was spending its own unconfirmed change txouts. 

But as Gox started spinning on that little dildo, some malefactor went, "Hey, I bet we can give them a much bigger dildo to spin on!  We can make Bitcoins cheap enough to buy a bunch of them if we make this look like a bigger problem!"    And they monkeyed up a little script, which they then pushed out to some botnet somewhere.

Their script takes regular transactions off the Bitcoin network and re-emits them in noncanonical form, in an effort to absolutely melt down anybody who hasn't completely fixed this bug yet.  Gox goes from having an occasional problem where it thinks it's made a payment that it hasn't actually made (because it made it WRONG), to being absolutely helplessly reamed on a giant monster cock.  The few remaining miners that haven't updated their software go from getting one extra orphan every once in a while to getting every last block orphaned.  Meanwhile the rest of the network is spammed with thousands of bogus transactions a minute, all of them copies/alternate expressions of 'real' transactions.  The real transactions (in canonical form) get accepted by the network and the bogus ones don't, but the network is under strain. 

This sudden flood of noncanonical transactions results in exposing an edge case in the qt and cli client software, as well as the software used by *MOST* exchanges.  This edge case is benign, but confusing.  The problem is that the noncanonical transactions can show up as unconfirmed tx for a while in your client.  They will never confirm, and the correct transactions that they are copies of will confirm eventually, so this is essentially harmless.  But it can make it appear such that you've accidentally made a payment twice, or appear that a payment coming to you has been sent twice - one of these payments will eventually confirm, and the other will not, but for a few hours, it will look like there is something wrong.  And the payments have different ID numbers. 

Bitstamp now looks at the situation, going, "hmm, there's a DDOS underway and I bet a bunch of our customers are going to be making transactions to try to "correct" this double payment situation which doesn't really exist, and when they understand what actually happened, and that there were no actual double payments being made, they'll have made transactions they wish they hadn't.  We should head off that situation somehow...."  and so they suspend trading because they figure that's easier than trying to explain everything to their user base.

Other places, like Coinbase, carry right on trading because they figure if their customers make transactions because their customers are confused, then that is their customers' problem not theirs, and besides they're in a more litigous jurisdiction and afraid that if they suspend trading that will open them up for lawsuits, either for failing to execute or for contributing to a panic.

Meanwhile, Bitcoin developers go 'doh!' and get to work fixing it so that noncanonical transactions which won't ever confirm also don't ever show up as unconfirmed. 

I'm just saying that they can't possibly be the worst crooks out there.  I mean, hell, I figure we know who the NSA are.  If they were really the worst crooks out there we *WOULDN'T* know who they are. 

They had public PR problems, boo-hoo, because they accidentally hired someone honest.  My heart bleeds for them.  But the absolute worst crooks wouldn't have that problem.

People keep forgetting that the NSA isn't the only thing like itself that exists in the world; probably not even the best.  And people keep forgetting that among those things, the NSA is probably only about average in terms of its honesty and morality.  And that just addresses government agencies, not even starting on whatever parasitic criminal organizations have infiltrated them. Hell, if the NSA is doing all the stuff in the Snowden files, and failed to even keep that a secret, I hate to imagine what NAPSS, BBN, GRU, SAVAK, Mossad etc, are up to.

Eligius is essentially the only miner who will clear crap like this out of the queue.  If it weren't for him the set of unconfirmed transactions would grow without limit until the network just ran out of room to store them.

So they'll pretty much all remain unconfirmed until Eligius gets a block or two or three.  Send the man a tip if you appreciate him unclogging your wallet and keeping the network running.

If it matters to you that a transaction should go through, pay the dang fee.  

It doesn't matter to the spam-motivated 'dust' spreaders; they just want people to *see* the transaction (and the URL that comes with it).  Which doesn't depend on the transaction ever confirming.

Note that spam isn't the only motivation for people spreading dust; there are also people spreading dust in order to link old spends to new spends.  This means you send 'dust' to an address that received BTC in an old transaction you're interested in, then wait for the 'dust' txout to be spent in some new transaction.   Then you know that the person who made the new transaction is the same person who made the old transaction.  Your client might never choose to spend a large BTC txout from the old transaction, but is very likely to spend 'dust' almost immediately, so this is pretty effective.