what BS but ... bitcoin to the rescue!

This could make for some great publicity for both bitcoin and the Swiss Gold initiative.

A proposal for an improvement to darkwallet's coinjoin system.
 
Darkwallet's coinjoin works with two parties. One party will wait around with bitcoins they wish to mix. Another party will connect with them whenever they want to do a transactions and the two parties will do a coinjoin. By analogy with exchange matching engines, I will call the first party the coinjoin maker and the second the coinjoin taker.
 
The idea is that there will be people acting as makers who will slowly mix their coins for the benefit of the takers who want to immediately mix.
 
Here is an example of a darkwallet coinjoin transaction
https://blockchain.info/tx/c38aac9910f327700e0f199972eed8ea7c6b1920e965f9cb48a92973e7325046
 
As you can see, the change addresses can be linked with the inputs but the address with outputs of 0.01btc cannot be linked. Mixing is achieved.
The maker/taker model solves the problem of having to wait around for someone who wants to coinjoin exactly the same amount as you.
 
There are a few small problems with this. I will propose an improvement.
 
First, the only people motivated enough to mix will be people who already have desire privacy. So, for the example of someone wanting to privately buy contraception and hide the fact from their parents, mixing may result in their coins being mixed with drug money. It is easy to imagine this ecosystem being split between 'clean' coins mostly owned by investors and 'dirty' coins owned by 'undesirables' of society. It's easy to imagine a blacklist system being made which these two groups are seperated and cannot cross the barrier of blacklists, which would be highly damaging to bitcoin fungiblility.
 
Secondly, there is little incentive to act as a coinjoin maker when you could just be a coinjoin taker and get your mixing done without any waiting.
 
Thirdly, a small number of coinjoin makers leaves open the possiblity of three-letter agencies offering coinjoin making, and using that role to deanonymize darkwallet coinjoins.
 
Proposal: Pay the coinjoin makers. They will put up offers to do coinjoin along with a fee they ask. The coinjoin transaction would be built up in a similar way to the above example, with the coinjoin maker fee being added to the associated change address and taken away from the coinjoin taker's change address.
 
An implication of this is that darkwallet coinjoin mixing will become like an almost-riskless savings account. We already see that holders of bitcoin are willing to earn just 0.006% per day by lending btc on the bitfinex exchange, and that contains a substantial risk that bitfinex will go disappear or be hacked taking all the bitcoins with it.
Darkwallet coinjoin with a maker's fees would be far less risky, the bitcoin private keys would never leave the owner's computer. This would likely result in investors pouring in. The huge relative supply of bitcoins along with the drought of other worthy bitcoin investments is likely to drive down the fees of mixing as the investors bid each other down.
 
The coinjoin takers will have access to tens of thousands of clean, untainted bitcoins to mix with at a very low price. The makers will have access to a very low risk investment for their bitcoins. Bitcoin fungiblility as a whole will benefit because the entire economy and flow of money will be more interrelated, making blacklists completely unfeasable. The market for coinjoin makers may end up so deep and liquid that three-party or even four-party coinjoins may become managable to organise.
 
 
~Belcher
PGP fingerprint: 0A8B 038F 5E10 CC27 89BF  CFFF EF73 4EA6 77F3 1129
 
 
some notes on the darkwallet example transactions
 
INPUTS
1FDCg = 0.0067
1FAkh = 0.0056
total = 0.0123
 
OUTPUTS
1MUZn = 0.001   total = 0.0062 => fee = 0.0005
1231P = 0.0052
1Fufj = 0.001   total = 0.0055 => fee = 0.0001
1iYSY = 0.0045
total = 0.0117
 
fee = 0.0006
 
so we can see the 1FDCg input address has the same owner as 1231P
 and that 1FAkh is owned by the same person as 1iYSY
 but cant tell from this tx which of those owns 1MUZn or 1Fufj
 
so we can see the owner of 1FDCg address paid 0.0005 for the miner fee
 while 1FAkh only paid 0.0001

EDIT: This should have been posted in the gold collapsing thread...

here is an interesting Jim Rickards video I happened to watch. he mentions Bitcoin out of the blue.

http://youtu.be/RVoMSJ4sry8?t=13m40s (just the snip leading up to Bitcoin - I found the full 20 min interesting.

What I found alarming: is firs he talks about "fiat" as print money, doesn't use the dirty fiat word that is so prevalent on this forum.
and second, he preemptively throws in Bitcoin - notably missing is rai stone in his comparison as he lumps it in with paper and feathers, but clearly on the radar as a competitor to Gold.  

What got me first into bitcoin was a talk by Rick falvinge from a 2012 bitcoin conference. He talked about the rise of the internet and the end of banking. Superb, funny and to the point.

Anyone know of a timeline for a public release of Electrum 2.0?   I want to try it with trezor, but am not tech savvy enough to be messing around with betas...

If I were a shorter I'd be scared as hell right now.

Couldn't it be some kind of manipulation? I mean, funds are borrowed, but not used to short yet.

I just pledged the crowdfunding. Hopefully they will reach their goals!

I've wondered the same thing. That combo is so rare that one can only conclude that the system of incentives is working.

against hackers
is it safe like a paper wallet?

is trezor 100% safe?

Total sum of active swaps
16,281.89 BTC

Holy shit.

I was having lots of trouble with the original bip32.js code using a BIP44 path but this was not specific to BIP44. Turns out there was a bug in the bip32.js code when deriving hardened keys. I submitted a pull request to them with the fix yesterday: https://github.com/bip32/bip32.github.io/pull/5

Stick you don't need a blockchain explorer to know anything about BIP32 or BIP44. Just generate 100 addresses at a time, don't show the ones with no transactions, unless the next address has transaction or a balance. Chain.com can handle this pretty easily and probably can be done all in javascript client side, not leaking the BIP32 Xpub key making it extremely more private.

They even have web hooks (https://chain.com/docs#webhooks-receiving) that you can use to push transactions to every user using websockets and have the javascript client side parse it and update the view. You could even just websockets the addresses changed in the transactions and if that matches an address the javascript client has, then update the transaction list and balances.

You don't need a block explorer to speak bip32!

holy fck! so i'll loose all my existing wallett if i click it?

Buy orders are definitely solid. We should be going over 400 soon.

Just as well then, it doesn't seem to me Satoshi thought we'd be using so many decimals, early on he proposed just moving the decimal point, and calling the new fraction Bitcoin. Seems some over enthusiastic programmers went and named and solidified the denominations making it impractical or confusing to go and just move the decimal point.

The next parity target is 1bit = 1USDbit (12.5c)

For 1 bit, one can currently buy:

• 16 Iranian Rial
• 13 Viet Nam Dong
• 7 Indonesian Rupiah
• 1.17 Colombian Peso

What exactly is not looking good, molecular? The site does go into offline mode every now and then but always comes back and catches up.

I like this too, and think it is the best option.

However, an alternative is to try and get two ISO codes, with XBT for 1 bitcoin and XBU for millionths (which would be used in existing financial systems).