The 2000 elections were an eye-opener to me in a number of ways.

 - I've stopped paying almost any attention the the mainstream media who showed their true colors when the chips were down.  They are mostly useful in that they offer the ability to analyze the nature of the propaganda directed toward the masses, and analysis of this can be valuable in understanding policy directions and thus in decision making.

 - I've viewed the supreme court as largely useless political hacks and it has rubbed off an all the courts from there down.

 - Obama really drove the point home that the two parties are very much two heads of the same horse.  Voting for POTUS is truly futile.  I wrote in someone in 2012 and will likely do the same from here forward unless I decide to vote 'against' someone.  In 2012 it was a no brainer that Obama was pre-selected to it didn't matter who I voted for.  His 2012 victory was clearly in the cards as I saw it, and from the first year of his first term.  This because he is either a weak willed sellout or a genuine fascist one or the other of these are the requirements for POTUS at this time.

I do take local elections fairly seriously and feel that it can be the case that we can send good people who can make a difference to represent us in the central government.  DeFazio, Wyden, and Merkley represent me currently, and I feel that they are all mostly fighting the good fight on critical issues of the day (banking, evolution of the surveillance state, transparency, etc.)

I should point out that I am not a Libertarian or an Anarchist.  I label myself a Socialist though there are plenty of points of agreement I have with Libertarians, and I see Anarchy as preferable to Fascism mostly since the pain would not last as long.

I pump my own gas in Oregon on a regular basis.  It's fine in certain situations.  I also now pay cash as recently there is a fee for using credit and debit cards.  I don't think the big bad government had much to do with that, but I also don't care.  I prefer cash anyway...and did even when PRISM was just a tinfoil hat conspiracy theory to most.

I'm guessing that you probably bounce around from one failed state to the next to avoid oppressive government mandates like all Libertarians/Anarchists who actually believe their own rhetoric?  Or maybe not as you seem to be able to access the Internet and have power for your computer.  Or is it solar powered?  I keep hoping that eventually a Libertarian utopia will pop up but for some reason it never quit seems to materialize or last very long.  What's up with that?

After savaging Bitcoinica, the BCF, and Coinlab this one-man wrecking crew moves on to his next adventure.  The Winkle ETF perhaps?

 edit:  Here's a suggestion to do the most damage to Bitcoin as possible:  A tainting authority!

From a practical perspective, I pay less for gasoline than in CA.  I usually go into the store and buy something since I don't have to stand at the pump.  In the store, I pay no sales tax.  I own a great deal of property in Oregon and pay less in property tax per year than one month of rent on a crappy apartment in silicon valley.

Operating the pumps provides some economic opportunity for more rural communities lessening the pressure for urbanization.  It also reduces the propensity for crime when more people have something which passes for a job and that reduces the law enforcement expenditures.

We also send legislators to Washington who actively fight against the 'turn-key tyranny' of the federal surveillance state which basically exists mainly to support bankers and war profiteers at this point.  DeFazio, Wyden, Merkley.  I think it no coincidence that the same people who vote for these types of people are also especially interested in constructs such as distributed crypto-currencies.

It is worth note that as a state we are not financially well off since we are at or very close to the bottom of the money we extract from the military industrial complex and probably from the banking infrastructure.  We cannot afford to implement counter-productive policies on some vague assertion that they align with some libertarian principle or whatever.  Since the rest of you don't seem to be saving much money for exercising your God-given right to pump your own gas, I would say that it is a fair guess that your money is going straight into the pockets of your politicians, corporate executive's bonuses, and lobbying firms.

Given the info released by Snowden (the number and placement of backbone network taps and relationships between corporate and various governments players) I believe it is fair to say that Bitcoin is effectively part of the surveillance system.  Just like any other real-time network construct (including possibly TOR.)

I (seemingly alone) feel that there is either more to the Utah datacenter than simply a storage repository, or that there are others which have been kept more private.  I expect that the next shoe to drop will be a centralized location where actual packet filtering based on near real-time analysis will be taking place.  Kind of a 'mothership' where tough decisions about filtering are made when the edge filters lack information.  Sounds crazy, yes, but my (and others) warnings about widespread collection and relationship link analysis was whacked tinfoil-hat material not long ago as well.  Now not so much.

What of the situation of these three Bitcoin related entities being so close to the Utah datacenter?  My initial gut feeling is that it is probably coincidence.  But interesting enough to log for further analysis.

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One last thought.  The idea that this data collected by the NSA is necessary to 'fight terrorism' is absurd.  Like many other similar systems throughout history, a large part of it's usefulness is in intimidating people.  But how effective is that going to be if it is kept secret?  (Much the same question Dr. Strangelove raised about the doomsday device...)  The system needed to be uncovered at some point...and it is now pretty clear that it has been running for long enough to have collected a bunch of goodies on just about anyone who had anything worth collecting.

Some have suggested that there is more to Snowden than meets the eye, and I've read some interesting analysis of the documents he's leaked.  At this point I consider these hypothesis that the Snowden operation was staged to be weaker than the hypothesis that he is the real McCoy, but they remains alive and worthy of continued exploration.  It is likely that a fair amount of subterfuge was going to surround this spy network throughout it's life-cycle. 

Snowden described the surveillance network best:  A turn-key system for tyranny.  How the likes of Gavin can retain confidence that Bitcoin will receive a fair shake from the corp/gov state on the basis that Bitcoin is a constitutional and legal system boggles my mind...although I am not him and cannot say positively that that is the basis for his confidence.

I started on a path to describing some of this stuff before I got more interested in running my sawmill:

  https://sites.google.com/a/tcilgl.com/paracoin/home/depth_l1/network_mesh#TOC-n-space-characterization:

Several concepts which I've yet to attempt to describe would be

 - multi-pass proof of work with non-predictable algorithms.  So, for instance, head blocks are solved mainly by transfer nodes while legacy datasets are consolidated and locked with long duration (very high difficulty) md5 leveraging existing ASIC investments (at a frequency aligned with codebase releases.)

 - dedicated hardware nodes which contain useful things (like FPGA for adaptable algorithms, TPM for certain node identity needs, POE for a reasonable balance of power, cost, and convenience.)

 - node link rewards where 'close' peers are issues part of a reward which would foster a greater mesh density health.

I hope that the nature, capabilities, and relationships between potential adversaries of Bitcoin are becoming more widely appreciated in these post-Snowden days.  It is why I consider broadly defensive systems to be the most critical aspect defining value in a crypto-currency solution...or at least a 'reserve' one.

Whether there is the potential to adapt the existing Bitcoin as a value core in total and develop a robust supporting framework around it is debatable and I continue to feel that it is probably a long-shot.  Most likely Bitcoin will evolve toward (if not 'remain') an element of something akin to PRISM.

 edit: s/density/health/.  By 'health' I mean diversity more than anything.  The methods by which a 'healthy' node population could be engineered have some interesting parallels to how biological populations implement genetic material transfers.

'Something useful' could be, among other things, being verifiable situated in a domain which is underpopulated.  The domain could be geographical, political, implementational (meaning it works in particular way such as implementing an underrepresented overlay messaging protocol) or whatever.

Sorry, no.  It is an undeniable fact that at the very least you locked up accounts for 3 months and to the best of my knowledge have never stated whether you were going to or could pay everyone back.


The first is a fair point.  The second would have significant ramifications in the event that this matter is brought to court.  Understanding the means and motivations for your group to obtain these funds would be helpful in trying to determine if you are likely culpable in the subsequent disappearance of them.


Don't paint everyone with that broad brush.  I personally defended the logic of keeping quiet about many aspects of this event but requested, and very tactfully, that it be verifiable that appropriate action was being taken.  A lot of others were similarly polite.  It was a simple thing which would not have harmed in any way the ability to resolve this matter.  It was also completely appropriate given the history of similar thefts in the on-line wallet space.

As I recall, I also spoke up against stupid and poorly thought out actions against Bitcoin-Central even when I was most dis-satisfied with your performance and most suspicious of your behavior.  True, this was partially because I felt it would be counter-productive should a decision be taken to pursue things legally, but part of it also was that I find such things low-class and generally useless.


Yes you do.  The deadline is coming right up.  As always, best of luck (for real!)

It is common sense that the possibility of arranging a cold wallet setup and surveillance which protected against catastrophic loss existed.  Was it to much to ask that your organization managed to do so?  My answer is 'yes'.  You guys talked a big game, but then everyone does that.  I knew my funds were at risk all along.


Given that the funds you bought or were given by Jav (and subsequently lost or stole) were funds that I personally deposited, it is distinctly my business.


You were hardly 'Johnny on the spot' with information about the police report other than an initial assertion that you had filed one.  It would have been ultra simple to have simply followed up with some simple information when probably 50 people asked about it.  And most of us asked with the utmost in tact.  It would have saved endless grief and hard feelings.  To this day there is no explanation for your failure here other than sheer arrogance.

More information will be available once we see how your dispensation is handled.  This will be useful for further perusing the matter if such a pursuit is undertaken at all.

I believe that the 'two party' idea is largely a myth at this point.  There are ideological differences, but they tend to be along a different divide.  In fact, the concept of developing a totalitarian-capable surveillance system is an excellent example of this.  Most democrats and republicans embrace the concept fully.  There are, however, outsiders on both the right and the left who are not on-board.  Wyden, Paul, and I handful of right-wingers who's names I cannot recall are balking.  Certainly there are elected representatives who are to stupid or uninformed to grasp what's going on, but most of them have to be entirely aware of what they are constructing.

I was certain that Obama was going to win a second term less than a year into his first.  He is everything his fascist masters could have wanted and has great power over the party-line dems even now...which is kind of hard for me to say as a lot of them are my dear friends.  Obama won the second term with exceptional ease by employing the same kind of analysis that on-line advertising companies use.  This requires a lot of PII (Personally Identifiable Information) so his lust for such data could be explained on that basis alone though at this point I believe his motives are probably even more sinister and he is fully aware of what he is doing to our country.  He is either very weak or genuinely evil and neither is especially promising for us citizens.

One really does need to ask oneself why our government is building this thing.  Clearly the 'fight against terror' is a joke and most of the architects must know it.  The strongest explanation I can see is that it will be needed in the aftermath of an economic meltdown and the likely world war which tends to follow these things.

Some of you may recall the PNAC.  I happen to believe that these guys (Cheney, Rumsfeld, et-al) were exactly on target in a lot of their analysis.  Specifically that there is one last shot at any nation arranging a hegemony in a multi-polar world, and what follows is most likely to be a one-world government of some sort.  I don't rule out Orwell's predictions for a small number of super-states, but even he left open the possibility they were a fiction invented to manage the proles.  One way or another, a high level of surveillance is a key tool in any number of potential dystopian settings.

The good news is that none of this may fully congeal within my lifetime, but I am pretty confident that we have taken several big steps into the swamp as I write this and that we are farther into it than most people realize.

If a customer losses access to their money it is accompanied by an explanation.  Unsophisticated users are pretty much always made whole and it happens in a timely manner.


It would be unlikely because there would be an investigation and punishment, so no.  This is not the case with Bitcoin.  It is trivially easy to steal money and I cannot think of a time when a theft has been officially investigated or prosecuted.  I am also unaware of anyone who has been punished in an extra-judicial manner over and above some name-calling on a forum.  Thus, the barrier to theft in the Bitcoin ecosystem is extremely weak and naturally it happens a lot.

On top of that, many people who were attracted to Bitcoin in the first place have a reason to wish to hide or obfuscate wealth, and that is likely due to prior instances of theft.  (Wagner, BFL, etc.)

Your statement seems to remind me again that you see some justification for the loss among your customers by virtue of not charging a fee.  I'm calling bullshit on this, and especially since it is not yet know how you acquired the funding from Jav.


It is hard to imagine you building a successful business with an attitude of "We didn't try to lose your money so it's cool." and "Trust what we informally write on a forum and shut up about it."

Thankfully it is possible in crypto-currency land to build a system which mostly precludes trivial thefts of the type that Instwallet users fell victim to.  I strongly suspect that the entities who develop along these lines will thrive and the 'trust us' dinosaurs will fail in offering a desirable solution.  You can join 'Tom Williams' and a host of other's who have ushered in an era where user's watch out for their own asses.

I think that the biggest problem our leadership (in the US) has with terrorism is that there is not enough for them to achieve their goals.  They practically have to strap dummy vests on borderline retard kids themselves in order to catch any 'terrorists' and get a good scare going among the plebs in these lean times.

A vastly bigger threat of harm to me is corruption and mis-management of my tax dollars, and that is where surveillance is of genuine value.  Here's the policy I would put in place if I had my way:

 - Anyone who wishes to work in the government at a management or higher level submits to surveillance.  Those who don't wish to submit are free to resign.  They will receive full pensions as promised...unless 'austerity' intervenes...

 - The records accumulated since the spying went into place are preened of all but government official's data and one degree of linkage.

 - The entire ball of wax is open-sourced for analysis by interested taxpayers.

I would also not only fully pardon Manning and Snowden and the rest of the whistleblowers but ask them to become high ranking officials in an honest and honorable government.

I hope people do.  Bitcoin is fairly unsatisfactory as an exchange currency and attempting to use it in that manner will probably result in a collapse, or at least in an evolution which quickly removes it from the category of valuable solution.  Employing it as a low velocity high powered wealth representation solution is probably it's best hope for sustainability and competitiveness against other solutions.

OTOH, it is possible to do much better than Bitcoin when targeting any number of needed niches so it could be a good thing if it 'burns out' trying to support 'skittles and goat cheese' transactions the world over.  It is largely simple greed on my part to hope for Bitcoin to eventually do another leg-up trick since I happen to hold a lot of them.

Sorry to follow up on my own post, but some people may find it interesting.  So, while we wait...


I +100 to that, BTW.


I actually consider the handling to be evidence of non-wrongdoing on the part of Bitcoin Central.  Here's why:

This things started out by 'thefounder' proposing a (fairly meaningless) weakness in Instawallet.  It was, however, sufficient to get me to finally take action to draw down some of my balance which I'd been meaning to do for a while and had not gotten around to.  I suspect that others had a similar reaction.

The theft happened very shortly thereafter.  Bitcoin-Central displayed the kind of confusion in their various responses that I would have expected from a non-perp.

The lock-down of their various services and correspondence about things around this time are also what I would have expected from a small organization who was struggling to understand the scope of the failure.

Most critically, the timing of planing and code development necessary to implement a reconciliation were also exactly what I would expect in an innocent scenario.  Were this theft a carefully planned operation, I doubt that Davout/Boussac would have had the foresight to match their operations to the observations I've made, but it is certainly possible.

In the days ahead we will find out how interested Bitcoin-Central is in providing more transparency and hopefully what actions they have taken to resolve and prosecute this crime.  If any.

Not worried about it at all.  It was a totally conscious and calculated decision to shoot for a much higher target.  If we would have gotten to around $600/BTC on the run-up I would have started the next phase.  We didn't.  On this last cycle.

I consider the 'higher target' a long-shot and will not be surprised at all if it never happens or if I miss the boat for some reason should it occur.  But I also considered 10x to be a long-shot and always anticipated the probability of a total loss.  I currently feel that the probability of hitting the second target is higher than I suspected hitting the first one was almost two years ago.

Awesome!  I was pretty much at the point of believing that my fellow Americans are to fucking stupid to deserve anything but a totalitarian police state, and a fair number of them would probably feel most comfortable in that setting anyway.  These students give me some hope.

Like I've said before (and before Snowden) the only silver lining on this amazing surveillance framework is that it will be sweeping up evidence of people who actually HAVE things worth hiding, and a lot of them are currently in the seats of power.  So this trove of data is the best hope to see them swinging from meat-hooks (figuratively) at some point in the future.  But only if we can get people like these students in the drivers seat.  And I expect that THAT is exactly why it is so important to Obama, Cheney, etc, that the police state framework they are building works effectively.

---

Here's a prediction.  I predict that 'because Snowden spilled the beans', 'terrorists have changed their ways' and it is necessary to eliminate from the network crypto which is not back-door'd for the safety of Americans.  (If/when this happens it will change aspects of how/if Bitcoin operates significantly BTW.)  My extra level of paranoia and reason to be extra careful about accepting as fact certain things around the Snowden affair probably stems from a several years old story involving security contractors and Greenwald by name.  e.g.:

  http://www.techdirt.com/articles/20110209/22340513034/leaked-hbgary-documents-show-plan-to-spread-wikileaks-propaganda-bofa-attack-glenn-greenwald.shtml

It is interesting to note that where initially a majority supported Snowden's whistle-blowing, that has shifted after the mainstream media has had a chance to chew on the general public a bit.  The fat middle is now accepting that the surveillance is necessary to fight terrorism and Snowden should not have given away 'our' secrets.  So they will also probably accept that steps to keep terrorists from making and end-run around the system are also necessary.  Only about 5% of people are aware of what cryptography actually is anyway, and only about 15% even have the native intellect to do so if they tried.  My estimates.

Not totally clear.  By my ball-park estimations, I'll have to wait several quarters to start.  Then the fun may last only as long as it did last time.  That is, for the duration of the meat of the bubble.

As for the top, I'm still hoping for another leg up in a few years, or any time there is a significant financial calamity in mainstream-land which could easily happen before that.  If we are so lucky then gold will again be badly beaten...at least in the minds of those who take a simplistic view of investment/speculation strategies.

I only consider myself a 'trader' because I've shifted to the frequency domain.  In the time domain I would have to claim to have lost a huge amount of money (by my standards) by virtue of not cashing out a bunch during the big run-up.  I mean, the difference between buying and not selling is minimal.

In the frequency domain (buying low, selling high) I'm sitting pretty, but when one converts back to the time domain, one finds that years have passed.  Boring.  But I'd rather be bored than broke, and I always planned on spending many years with Bitcoin...if it lasts that long that is.

Well...um...some people might assume it.  I mean that's kind of how banks work after all.

I appreciate your +100, but do need to voice my opinion about how the timing of the supposed reconciliation was handled.  My opinion is that in this respect Bitcoin-Central did a reasonably good job.  If Boussac and company are innocent of wrongdoing, the theft was an unfortunate event and it could be expected that all participants take a share of the inconvenience if not the cost.  For my part I was always keenly aware of the risks I was taking by having funds in Instawallet and have no complaints about shouldering some of the inconvenience.  One quarter seems appropriate to allow semi-interested users and (supposedly) law enforcement to analyze and take various actions.

One of the many hypothesis that remains completely open (thanks to Boussac's neglect) is that this was an inside job.  A key to games like this is to leave oneself various options to account for future unknowns.  It could have gone something like this:

 - BTC values rise and Bitcoin-Central decides to 'go'.  They arrange a theft and cash out which, owning several related properties in the exchange space, they are relatively well positioned to arrange.  It is known that Bitcoin-Central took some action to obtain the funds (including 'mine') from Jav, but unknown whether a plan of absconding with them at some point was ever part of the reason why.

 - If in three months BTC values are way up, they fold as insolvent.

 - If in three months BTC values are down, they buy in to make everyone whole, then keep the excess.

If there is a legitimate investigation with the power to subpoena and audit Bitcoin-Centrals records such a thing can easily be determined.  If there is not, and if one never emerges (and if the crime remains otherwise unexplained) then there will always be a question about whether this is what happened.

Again, because Boussac or anyone else says something on an e-mail or a forum is simply useless in understanding the reality of this event.  Analysis of what someone said can uncover a lot.  That is why smart perps say as little as possible, and why I personally am very suspicious when people avoid transparency.