If you use a hammer where what was actually needed was a screwdriver, do you have a legitimate complaint when the results go badly?

i.e., there is a reason why multiple confirmations are required before a transaction is trusted.

Right now, there is a solution.  As long as both the merchant and customer use the same ewallet provider, transactions can be instantaneous.  MyBitcoin works this way already today.    Similarly, another solution might be simply to advance some amount to an account with the merchant or with some other intermediary.  Consider if the mobile point of sale vendor Tabbed Out were to add bitcoins as a payment method, for example.  They would hold your coins in their wallet so those coins would be spendable instantly regardless of which restaurant you dined at.  With those solutions, however, you have the drawbacks where you must extend trust to an intermediary and lose some privacy.

One other idea includes a pure bitcoin method where low value transactions might be allowed on receipt by the merchant with no confirmations.  This method assumes however that there are listening posts on the network that would monitor for double spends and alert the merchants after any double spend attempts were discovered.  Without such monitoring, this approach would be completely vulnerable to your attack scenario.

Additionally, there have been reports that work is underway to integrate bitcoin with the Open Transactions platform to allow transactions that are both anonymous (as far as the merchant knowing the buyer) and also are instant, requiring no confirmations. This too requires pre-paying bitcoins to the OT account that will be used for spending.

If you weren't aware, there is at least one VirtueMart shopping cart interface plugin that supports bitcoin:
  - http://en.bitcoin.it/wiki/Bitcoin-virtuemart

How about those whose wallet has a balance because they received a payment and either haven't spent the funds or haven't sent them to an exchange.

Where do they fit in your list?

But even if this is done right, on first use you would then have my decrypted wallet on your host.  I'm still having to trust that you don't keep a copy.

So this is an online service like MyBitcoin.com except each transfer out requires a PIN that is received via SMS or other method? [edit: see my next reply]

While this is marginally better than simply username / password credentials, it still isn't the combination I'm looking for.  I'm wanting a wallet server, like what Webcoin promises to offer.
  - http://bitcoinjs.org/specs/wallet/1.0/draft/wallet-api.html
  - http://forum.bitcoin.org/index.php?topic=14128.0

Bitcoin wasn't meant to allow instant confirmation.  That 10 minute wait was determined as the length necessary due to latency on a global network.  

Obviously, that type of payment represents a lot of payment volume that bitcoin is leaving on the table.  There have been multiple ideas on how to allow bitcoin to serve this function.   None of the ideas address reducing the length of time to confirm blocks as there's no lower value that would solve the "point of sale" problem yet would still allow Bitcoin to work.  As [Mike] from the forum put it, you either are "< 5 seconds or > 5 seconds".  So neither 1 minute nor 10 minutes to confirm makes a difference for making point of sale more possible.

Right now, there is a solution.  As long as both the merchant and customer use the same ewallet provider, transactions can be instantaneous.  MyBitcoin works this way already today.    Similarly, another solution might be simply to advance some amount to an account with the merchant or with some other intermediary.  Consider if the mobile point of sale vendor Tabbed Out were to add bitcoins as a payment method, for example.  They would hold your coins in their wallet so those coins would be spendable instantly regardless of which restaurant you dined at.  With those solutions, however, you have the drawbacks where you must extend trust to an intermediary and also will lose some privacy.

One other idea includes a pure bitcoin method where low value transactions might be accepted as payment on receipt by the merchant with no confirmations.  This method assumes however that there are listening posts on the network that would monitor for double spends and alert the merchants after any double spend attempts were discovered.

Additionally, there have been reports that work is underway to integrate bitcoin with the Open Transactions platform to allow transactions that are both anonymous (as far as the merchant knowing the buyer) and also are instant, requiring no confirmations. This too requires pre-paying bitcoins to the OT account that will be used for spending.


When it happens the drop from 50 to 25 will not come as a surprise.  

Considering the worst case you describe (50% of mining capacity drops in response), instead of 14 days of 10 minute block confirmations it is 28 days of 20 minute block confirmations.  Since transaction fees reflect a growing part of the block bounty, a 50% reduction in currency issued will not have a 50% reduction of income to the miners.  Even so, is this big drop to the miners going to be felt? Yes.  Is it a serious enough problem to force a change to the protocol? I wouldn't think so.

The fact that miners "get hit" is really not a concern.  Bitcoin is likely already well beyond the amount of mining necessary to be protected from an attacker with lots of hashing power.  It likely could survive just fine if half the the miners it currently has were to disappear at any point in time.


it's part of the algorithm, it can't be changed.  :-)

There had been a pattern that was pretty reliable:
If on Wednesday night / Thursday morning the high water mark for the prior 7 days was below the high for the week before, then a weekend dip could be counted on where selling and then buying those coins back on Sunday afternoon would yield 10 to 15% gain.

The reason that was happening was likely due to the outflow spigot being wide open (bitcoins can be sold and funds withdrawn 24x7) yet at the same time there is no corresponding inflow in which funds can be added to the exchange.  

Funds added to Dwolla and by bank wires arrive only on business days, so there are no new funds arriving from those sources on the weekend.

With a lower price come Sunday, those in Asia and Europe are the first who are able to wire funds or make SEPA transfers, so once that happens on the following week, the market price would once again rise.  So to reaquire those bitcoins, the repurchase would need to occur by late Sunday.

Whether or not this pattern recurs is unknowable, but with a higher difficulty, miners trying to pay off mining equipment just had their "income" cut by a third from this latest adjustment.  As a result many will likely be hoarding less (if at all) and selling more of what their mining activities bring in.

At some point there will be a futures market with options where these ultra short-term (weekly) cycles will be leveled, but for now the weekend dip appears to make the "sell Wednesday night/Thursday morning and buy back on Sunday" trade continue to be profitable.

Though don't forget -- if there is a big buyer, that amounts sold by miners affects the market price very little.  See the chart from Easter weekend to help understand that situation more clearly.

Between the DDoS attacks, and $3+ million dollar trading days, it is conceivable they've not been on top of everything.
 - http://bitcoincharts.com/charts/mtgoxUSD#rg30zigDailyzvzcvzm1g10zm2g25

They now have a help ticket system.  Have you reported an issue / opened a ticket?
  - https://support.mtgox.com/anonymous_requests/new

Just to make sure it is clear:
 - http://blockexplorer.com/block/000000000019d6689c085ae165831e934ff763ae46a2a6c172b3f1b60a8ce26f
The miner of Block 0 was awarded 50 bitcoins to a single bitcoin address that was generated, 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa.

All bitcoin currency that exists and will ever exist was issued as a block reward, which is currently 50 BTC but will be dropping to 25 BTC per block in about 18 months.

Incidentally, those bitcoins have not yet been spent.

Right.  And when the buyer clicks that middle button and pays using funds from a MyBitcoin account, the merchant doesn't need to wait, it is instantaneous. (i.e., no "confirmations")

Unfortuanately, there is no longer a real-time chart on any publicly visible site which charts transaction volume in real-time.  That chart would show yesterday's activity as ranking either as the top or 2nd highest as far as the number of bitcoins spent in a single day.

Of course, that number means almost nothing because, as you might have presumed, it isn't likely real economic activity but instead is one person sending bitcoins back and forth between wallets.

The most recent chart is from nearly a month ago:
 - http://bitcoinreport.blogspot.com/2011/05/updated-transactions-per-day.html

There is a daily recording of that count:
 - http://twitter.com/bitcoineconomy

There is a calculation that will provide a better measure of activty.  That calculation is called the BitcoinDays Destroyed measure.  That too is not publicly recorded, but it is an open source script that you could run yourself:
  - http://en.bitcoin.it/wiki/Bitcoin_Days_Destroyed
  - http://forum.bitcoin.org/index.php?topic=9300.msg135639#msg135639

For storage in an envelope with other valuables that's a perfect denomination.

Ok, ... well it's your money and it is none of my business what you do with it.  Sorry.  

And as you mention, it was a good "audit" since there weren't already very many documented cases of a Bitbill getting redeemed / spent.

Incidentally, a spent Bitbill casing might be of interest to the British Museum's Modern Money exhibit?
  http://forum.bitcoin.org/?topic=4573.0

Not sure I follow.  For the MyBitcoin Pay Now link there are two payment options provided.  One allows the buyer to pay from a MyBiticoin account.  Here's what is rendered:

Just to bookend this thread:
  Pull #220, Wallet and key import and export
  - https://github.com/bitcoin/bitcoin/pull/220

 - http://en.bitcoin.it/wiki/Wallet


We can't know what will happen in the future but we know that software changes and improves.  There will likely always be a way to import either the binary wallet data file itself or to export wallet data and import that data into the new system.

Related:
  - http://forum.bitcoin.org/?topic=2348.0

Do you know there is a 3-month backlog for those, and you wasted them just to get even money by cashing in the codes? (which destroys the bitbills)?

Well, that makes two now:
  http://groups.google.com/group/bitcoin-discussion

Cool, I added it to the list on the Bitcoin Wiki
  http://en.bitcoin.it/wiki/Bitcoin:Community_portal

If you haven't read the following, please do:
 - http://en.bitcoin.it/wiki/Myths#Bitcoins_will_be_shut_down_by_the_government_just_like_Liberty_Dollars_were

Remember though, bitcoin is just data.  The assumption is that if there were government action, the first moves would be directed towards the exchanges.  Without being able to easily exchange bitcoins for fiat, and vice-versa, at this stage would have a significant impact on the market value -- which affects everyone, not just the country(ies) that the government took actions.

Even though you're not experiencing the problem I wanted to offer an answer so you know why it likely happened.

When you launch your client it connects to peers and then starts receiving blocks.  You can always tell if it has caught up to the latest block by checking the block count in the client against the BlockExplorer's count:
 - http://blockexplorer.com/q/getblockcount

If your transaction has been included in a block, you can search block explorer to see which block.

If your transaction is still waiting for a miner to include it in a block, you should be able to see it here:
 - http://bitcoincharts.com/bitcoin


Generating is "mining", and thus is not something that would affect seeing a transaction.

Good to know you were able to get the problem resolved on your own though.