Of course, if *you* have already bought mining hardware, it would be very convenient for you to dissuade others from mining and keep the difficulty low, so *you* can pay off your hardware.

From a network point of view, higher difficulty means the bitcoin network is much more secure and resistant to attack.

Please continue...

I have to say, and it's a little irrelevant to this thread, but common to many threads, that this argument "If you don't like X, then do it yourself", really irritates me.  It's like as though if there anything I don't like I should get up and do it myself.   As in:

"Hey stewardess, the seat in this aeroplane is too skinny for me"
"Well then, why don't you just run along and build your own aeroplane"

It's ridiculous to suggest that everybody has time to do everything themselves.  That's a feature of human society called "specialisation of labour", and it's been with us, ohh, I dunno, ever since we first started to plant crops I suppose.

Hazek doesn't like some aspect of MtGox, but that doesn't make him a programmer with sufficient skills to make his own site, nor does it give him enough spare time to do it, even though there is no law or de facto standard that would prevent him.

So as a general appeal to all: some people just don't want to do everything, and prefer to rely on others.

Now give the government 90% of the hashing power and suddenly you can have all transactions approved only by govt servers, all parties to a transaction being only govt approved bitcoin addresses, and all transactions automatically taxed.  It's more than a government's wet dream, it's the wettest dream Big Brother ever had.

Of course, I understand that the use of the word "mine" in reference to bitcoins is just a convenient analogy.  However, the from a financial point of view, there is more similarity.  There is something of value waiting to be discovered.  I discover it and thereby increase my net personal value.

More correctly, however, I don't actually give myself the coins.  It is the network that gives me the coins by accepting the block I generate.  Right?  The decision to award 50BTC to me is distributed over the whole network.  There are many next blocks "out there" waiting to be discovered, I find one, lay claim to it and the annexed reward, and the network as a whole approves.

Suppose, let me think, that I create music, and sell it.  How is that taxed?  Music is fairly intangible.  Or what if I sell something artistic, like picture - firstly what if it's a real painting on canvas, then what if it's just a digital image stored on computer?  How would that be taxed?

In principle I agree with OP, but most likely the fundamental problem is that MtGox has such a huge market share of public exchanges, maybe 90-95% or so.  The dark pools on MtGox can only be damaging as long as MtGox has this large market share.  All holders of bitcoins who do not want to see a repeat of the bust of last weekend, would do well to trade elsewhere.

Let me try to explain better: the dark pools on MtGox only offer an advantage to wealthy bitcoiners *AS LONG AS* there is a large list of public asks and bids on MtGox to draw from.

1. If you don't like the advantages dark pools offer to large traders, then take your BTCs elsewhere.
2. If you want price stability, then don't trade on any exchange that has an excessively large market share.

Maybe someone shorted the market?  Maybe even successfully?

What if you consider mining bitcoins just like mining gold?  Suppose I find gold on my property and start to mine it, and make a tidy profit.  How is that taxed?

What do you mean by "how they've capped gold and silver"?

I don't know that that's true.  Look at the government - if bitcoins take off, then the way the government handles its finances will be *very* different.  Me too.  Most people too.  C&TO's too, I presume, if they buy into it.



I'm not talking about obtaining a C&TO's wallet.dat so you can trace their activity.  I'm talking about obtaining the wallet.dat, then transferring the funds to your own wallet.dat, leaving the C&TO without any funds to pay their dispersed agents.  I mean, as long as a C&TO has their funds locked away in traditional assets, it's not easy to it all away at once.  But if a significant part of their wealth was in a wallet.dat and they lost that?  Picture, heck I dunno, a TO paying for an illegal arms shipment.  Both the buyer and the seller will appoint some individual to ensure the safe transfer of the BTCs, meaning you might have a wallet.dat worth millions of dollars.  For this reason, I think C&TOs might be reluctant to transfer into bitcoin-land.

The best defence would probably be to have all funds split into multiple wallet.dats, with no individual ever obtaining access to them all, but that seems far from perfect.

Mtgox trades 30000 bitcoins per day, add in the other exchangers, IRC trades... crap, you'd probably need to dump at least 20000 BTC to make it really noticeable.  Probably more like 50k.  That's half-a-million $ right now.  And even with 50k BTC dumped on the market, it's far from certain that the price would substantially drop - interest in bitcoins is increasing at an extraordinary pace.  Multi-thousand dollars, I reckon, wouldn't get you very far.

*this* would be great.

This has gone a bit off-topic.  The point was that a bitter insider or a police/law accomplice could, maybe, quite easily bring about the financial ruin of a criminal organisation.

I mean, how many of you would trust your best friend with your wallet.dat?  Would you ask him to turn around when you type your passwoord or passphrase?  Is your wallet.dat even encrypted?  I daresay any C&TO that deals in bitcoins will take serious measures to protect their wallet.dat(s), but it would just take one person, one time, to take it all away from them.  Therefore, C&TO's will not deal in bitcoins. 

That's the hypothesis.  Is it valid?

Pleeeeease... just for the sake of argument?  Just so we all have a common ground from which to build our argument that bitcoin will not be useful to the bad guys?

I just started this thread.  I present an argument for why bitcoin might not be so useful for large criminal groups.
http://forum.bitcoin.org/index.php?topic=11138.0;topicseen

Ahh, didn't realise imgur was registration-less.  Had facebook, despise it, deleted it.  Have google, despise it, didn't delete it.  Here's the graph.

http://imgur.com/CG9GG

Fine. Can you suggest one that doesn't require me to register?

Just for the sake of argument, let's use "The Law" as our yardstick.  The point of this is to counteract arguments that attack the validity of bitcoin in an honest law-abiding world.  Therefore, we must show why any entity that uses bitcoin specifically to circumvent the law, runs a risk not presented by traditional currency or assets.

Maybe he wouldn't  but you make a good point.  The informant or insider might still be a valid possibility.

I can't make it free.  The minimum cost is 0.02BTC.  If you don't like it, complain to ubitious.  Or better still, complain to the admins of this forum that the upload folder is full, then I'll put the graph right here for you.

There have been several articles about bitcoin in mainstream press lately.  I'm too lazy to type them out, but one of the arguments is that bitcoin will probably be used by criminal and terrorist organizations (C&TO).

Now, I quite like bitcoin even though I'm a bit nervous about the unbridled capitalism it might usher in, but I'd hope that'd be better than the unbridled, what, fascism? that's taking over the western hemisphere.  So, in short, I'm kind of hoping that bitcoin will succeed and governments will cede some economic power to the public.  That means I hope bitcoin doesn't get branded as money for criminals and terrorists and so become outlawed.  That means we need to find an argument as to why bitcoin won't be useful for such organizations.  Here's a first try.

As things stand,  C&TO have to 'clean' their money.  They have to recycle it through... damned if I know, fake shops, stuff like that. Whatever the core of their wealth is, it's something physical or traceable - banknotes, jewellery, electronics, bank accounts, whatever.  Bitcoins are neither physical nor traceable, so... C&TO's wet dream, right...?  Wrong.

Anyone wishing to destroy C&TOs need to attack on multiple fronts and destroy or remove the source of wealth.  Right now, with physical & traceable things, that's difficult, and whoever does it becomes a target for retribution.

With bitcoin, a geeky teenager in a city on the other side of the world could hack a C&TO's computer and steal their wallet.dat.  Once word gets out that the C&TO can no longer pay it's henchmen, it would silently evaporate.  Alternatively, an informant could steal the wallet.dat, or maybe even an insider who decides to cross his mates.  And no-one would ever know who it was.  The anonymous geeky teenager or whoever does it would have to be careful about spending those bitcoins so as not to expose himself, but that's easily done with a few passes through an anonymizer.

Therefore: C&TO's won't be so interested in bitcoins.  You can't protect them easily enough.

Thoughts?