This is nothing more that expanding the debit based payment systems to a broader group of people. The key here is: Can a poor, starving, homeless person, accept payment as part of a business transaction using this payment system and then be free to spend these funds anywhere she chooses? More often than not with debit based electronic payment systems the answer is NO. With cash the answer is yes. The answer is also yes with crypto currencies.

I noted that the Coca Cola Company is listed as a private sponsor of this initiative. It is also no secret that the Coca Cola company is an strong supporter of GMOs in food. https://www.change.org/p/coca-cola-stop-funding-anti-gmo-labeling-campaigns. So is is safe to assume that this electronic cash can be used to purchase food that contains patented GMO genes. The real question is can this electronic cash be used to purchase food grown organically with GMO free seeds? We know the answer with cash is yes. The answer with crypto currency is also yes. We debit based payment systems the answer more often than not is no.

Edit: Do ALL vendors at all Farmer's Markets in the United States accept EBT? How about the neighbour selling those extra vegetables she grew in the community garden?

A lot of the MEW payment messages may have been lost due to the downtime of BCT. I did get the emails with the messages but not the message on BCT.

The key is that in the Ross Ulbricht case the prosecution has access to the Bitcoin private keys and can trace all the transactions, via the blockchain. Even in the case of Monero. If the prosecution has access to the private keys the anonymity would be broken. They would for example know the money that was received but not the address of who sent it. Now if they can get the address information from enough of the buyers then they have a very strong case since they have many buyers testifying that they sent x amount of crypto currency in payment for drugs to a given address and they also have the evidence that that particular address and the corresponding private keys belong the the person they are prosecuting.

By the way fungibility for innocent third parties is the real killer application for Monero over Bitcoin here.

Edit: XMR in this situation is like a Denarius. It was valid across the Roman Empire, regardless of whether a Carthaginian has handled that particular Denarius at one point. A more modern example would be US currency used to purchase goods and services in Cuba.

A supertrend explosion of Monero usage could easily occur if the bulls get back control of Bitcoin and trigger the 1 MB blocksize limit. Ironically the current bear market in Bitcoin is giving the Monero project much needed time for the database development. For this reason a bear market in Bitcoin until the database in completed suites me just fine.

This could get very interesting, especially for POS ICOs, premines, promises to deliver a cryptocurrency before it even exists, representations regarding a non existent Silk Road clone for two years ...

Yes that is correct and it is perfectly fine with me.

If I now understand the formula correctly 8th dan is 5000 XMR, 9th dan is 10000 XMR, 10th dan in 20000 XMR, 11th dan is 50000 XMR, 12th dan is 100000 XMR etc. Then each dan level has multiple diamond sub levels starting with 7th dan.

So 7th dan can have 2, 3 or 4 crates of diamonds,  8th dan 5, 6, 7, 8 or 9 crates of diamonds, 9th dan between 10 and 19 crates of diamonds etc.

Which is why borrowing state becomes an option for someone wishing to attack a POS coin. That is the essence of the "Second Pirate Savings and Trust" attack.

+1 Very good summary.

Donations to fund Monero development can be made here. https://bitcointalk.org/index.php?topic=700400.0;all

Something tells me that going short on Bytecoin might be an interesting opportunity, especially after missing the opportunity of shorting Tenebrix.

I fail to see how this could possibly be a danger to Monero even if there was a default on the bonds. The reason is actually very simple Monero is proof of work.

Bloat is a legitimate short term criticism of XMR; however bloat is inherent in ring signature technologies. So basically it would occur in any Cryptonote. The argument is that bloat will become irrelevant because of advances in technology will make the cost of data storage, data transmission, memory etc., even more trivial than today. For example for an extra 15 CAD a month I get unlimited upload and download data on my Internet connection. This would have been unheard of as recently as 2008 when Bitcoin was created. A good analogy is credit cards. When American Express and Diner's club introduced credit cards in the 1950's the data processing technology of the time, tabulating machines and punch cards, could handle only a minuscule percentage of the credit card transaction volume of today. It was only in the 1970's with the advent of the mainframe computer that credit cards became viable as a mass consumer product. As for Monero over other cryptonotes it has the largest market cap and none of the controversy surrounding Bytecoin. Comparing Monero to Bytecoin is like comparing Litecoin to Tenebrix.

I like Namecoin because it provides a viable decentralized alternative to the ICANN DNS secured by the Bitcoin proof of work via merged mining. It is also used by the OpenAlias project, https://openalias.org/, started by the XMR developers.

https://docs.google.com/document/d/1UYASf0gHI-fxqQsyyLVUqLcQz6uowz1wydMHwc2JBPI/edit?pli=1#

The more I look at proof of stake the more I see banks and wall street under a different name. Something tells me the regulators will eventually reach the same conclusion. So I will stick to proof of work coins. If one wants to diversify into proof of stake one can always buy shares in a bank. I like XBT, XMR and NMC right now.

If one reads the whole attack there is a Proof of Stake specific part and a countermeasure. The countermeasure is the reason I am not launching the attack. Proof of Stake can work, but only with the help of the state. The OP's attack for example could be used as the Proof of Stake specific part / exit strategy so could any other attack on a POS coin that requires stake.

Edit: This is no different from the fiat system Take the state out of the equation and it collapses. This is what nearly happened in 2008. Banks are for the most part proof of stake organizations.

Here is the formulation of my attack. The "Second Pirate Savings and Trust" attack on Proof-of-Stake. https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752.

Sure the price of Bitcoin has gone down by 80% over the last year and the difficulty has gone up. https://blockchain.info/charts/difficulty. In my attack there is no additional purchase required, and is based on a scenario that has already happened.

The "Second Pirate Savings and Trust" attack on Proof-of-Stake. https://bitcointalk.org/index.php?topic=897488.msg10182752#msg10182752

I will formulate the attack: The "Second Pirate Savings and Trust" attack on Proof-of-Stake

1. The attacker creates the "Second Pirate Savings and Trust" modelled after the "First Pirate Savings and Trust" later called "Bitcoin Savings and Trust" https://bitcointalk.org/index.php?topic=50822.msg605957#msg605957. This is done in a falling market.
2. The "trust" offers a very attractive rate of interest payable in the POS coin. This rate is significantly higher than the stake rate
3. The "trust" allows investors to leave the interest in the "trust" and roll over the investment.
4. The "trust specifically disclaims that it is a HYIP / Ponzi scam https://bitcointalk.org/index.php?topic=50822.msg605981#msg605981
5. The attacker sells a portion of the borrowed POS coin say 50% for XBT, another POW alt-coin, one or more fiat currencies etc. This will becomes the attackers profit at the end. This will also depress the price by short selling creating the "bear raid"
6. A portion of the received POS coins is used to repay interest to those investors that do not reinvest their interest. This is the "ponzi" component; however see below.
7. The rest of the borrowed POS coin is kept by the attacker, accumulated and staked.

At this point this is no different from any bear raid on a stock, fiat currency POW currency etc. If the market exchange rate falls faster than 2x the interest rate less the stake rate then in the 50% example above, the attacker is actually in the black and there is no ponzi. In the normal bear raid the attacker, if the attacker can depress the price enough and cover the short, can actually walk away with a profit. The problem with the simple bear raid is that in covering the short the exchange rate can rise sharply. This converts the bear raid into a ponzi and the scheme collapses in a rising market. This is what happened to "First Pirate Savings and Trust". It collapsed during a rise in the Bitcoin price.

It is at this point where the specific to Proof-of-Stake part of the attack comes into play.

8. The attacker continues the ponzi until he has accumulated enough stake to launch a network attack.
9. The attacker is also accumulating a greater debt in the POS coin and can even continue selling 50% of the borrowed coin to increase his profit.
10. The attacker launches the attack on the coin causing its value to fall to zero. This wipes out the attacker's stake, but more importantly also wipes out the attacker's debt. The specifics of the attack will of course depend on the particular POS coin.
11. The attacker is left with is profit in some other currency, a worthless amount of the POS coin and a debt denominated in the now worthless POS currency.

Countermeasure:
The only known countermeasure is the intervention of the state.  http://www.sec.gov/News/PressRelease/Detail/PressRelease/1370539730583#.VLncGTVVIWw.

The challenge here is to devise a countermeasure to this attack that does not involve the involvement of the state or some other centralized authority for example a corporation.

Edit: The network attack can be any attack on a POS coin that requires the attacker to have stake.

It can be n@s but it does not have to.

The critical part is to acquire stake while at the same time maintaining a net short exposure to the coin. This is accomplished by a combination of borrowing the coin and then selling short a part of the borrowed coin. This sold coin becomes the profit to the attacker. The remainder of the borrowed coin is held and staked. At this point the market sees a conventional bear raid and the network sees nothing out of the ordinary. When the attacker has accumulated enough coin for the attack the exit strategy out of the bear raid is unleashed by launching the attack. This causes the coin value to plunge to 0, allowing the bear raid short to be covered at no cost to the attacker.