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1  Economy / Collectibles / [Auction] Casascius Series 1 2011 Coin, 1 BTC unredeemed on: December 14, 2017, 12:45:56 AM
This is an unredeemed first series Casascius coin, including the misprint. Condition is scuffed up but intact. You could probably clean it and get it looking significantly better.

Note that the face value is 1 BTC + 1 BCH + 1 BTG, so bidding starts at 1.12 BTC with .01 increments.

Available for pickup in the San Francisco Bay Area, otherwise buyer pays for mutually trusted escrow.

Auction runs for 72 hours from the time of this post.

Thanks! I've been a trusted member of the Bitcoin community for over six years. This is actually a coin I gave to a friend back when they were $3 apiece and I am selling it on their behalf. They reserve the right to pull the listing.

Edited to add:
2  Bitcoin / Bitcoin Discussion / Assessing Cryptocurrency Use Cases on: February 07, 2014, 07:09:20 PM

These are the most commonly discussed use cases for cryptocurrencies. How compelling are they, and how might that change?

Private Transactions

This use case remains the one where Bitcoin’s advantage is the biggest. The exchange rate may collapse; mainstream usage might never materialize; Bitcoin could be supplanted by a superior alternative — but some cryptocurrency will be in use ten years from now, if only due to the demand for it from this category of transaction.

The Silk Road was Bitcoin’s first killer app. Illegal goods are a big market, and one where Bitcoin’s privacy advantages are highly motivating

There are also totally legal kinds of transactions in this category. It could be something private that you don’t want on the credit card bill, or a donation to causes that you’re afraid would put you on a government list.

Bitcoin isn’t strictly anonymous, though. Zerocoin's much stronger anonymity guarantees make it one of the few proposed altcoins worth watching. It won't be surprising if the Silk Road's successors adopt it.


This is the most interesting use case to watch in the short-term. A World Bank report lists fees for existing remittances services at almost 9%, with potentially more fees at the receiving end. Whenever that cost is greater than the spread from using LocalBitcoins on both ends (and there do seem to be buyers and sellers all over the world), the use of Bitcoin for remittances might make sense.

The idea has gotten a lot of recent publicity, it’s addressing an existing market, there are no major technical obstacles, and startups like Kipochi and BitPesa are giving it a try.

That said, there’s no evidence yet of anyone actually using Bitcoin for remittances, and unforeseen obstacles could make it impractical. For example, what happens when there’s intermittent Internet access on the receiving end? Startups in the space must face regulatory compliance issues. We’ll see how this plays out soon.

Store of Value

Is Bitcoin a good store of value? “No.” Right now, it’s far too volatile, risky, and low-volume. How good is Bitcoin as a store of value? “Not very” — but that difference in framing is important, because it lets us see that there might be even worse alternatives. If you live in a country with a hostile national currency — places like Argentina, Cyprus, or, Zimbabwe — Bitcoin might be a rational choice for some part of your savings.

Everyday Purchases recently became the largest merchant ever to accept Bitcoin. It’s telling that the testimonials on their launch announcement are more about ideology than any practical advantage of the cryptocurrency. Their decision seems to have been made mostly due to the CEO’s political ideology, not customer demand.

Ideology might be motivation enough for some buyers. Overstock’s first-day Bitcoin sales figures were impressive. But I doubt they will be matched for a long time. In fact, I’d hazard a guess that Bitcoin sales have fallen to near zero.

Right now, for everyday purchases, Bitcoin’s advantages benefit the seller far more than they do the buyer. Merchants get the lack of chargebacks, as well as the near-elimination of transaction processing fees, which for credit cards can approach 3%. Buyers, though, have no apparent motivation to use Bitcoin instead of a credit card. If Bitcoin saves merchants money, they should incentive adoption by passing some of those savings on to the consumer. People will go a long way to save a dime.

The story for in-store purchases is even worse. The user experience of paying with Bitcoin doesn’t compete with cash or credit cards, not to mention Square Wallet. None of those payment methods involves scanning a QR code. A better UX could make Bitcoin credible here, but even then, Bitcoin would just be an implementation detail — not better than any alternative.

Perhaps the biggest problem right now is that Bitcoin only travels “one hop” on the transaction graph. Consumers have to buy Bitcoins just to spend them. Then, the merchants sell them as soon as they are received. Both parties incur losses from the attendant spread and exchange fees.

This needs to change on both ends: people who get paid in Bitcoin will be preferentially motivated to spend it, and merchants who can pay their suppliers in Bitcoin will benefit more from accepting it. When we go from one-hop to multi-hop on the transaction graph, there could be a phase transition, like when random graphs become connected.

Smart Contracts

Smart contracts are the wildest idea of the bunch. Beyond just sending currency from one person to another, a blockchain could cryptographically secure more complicated transactions: things like wagers, property transfers, or foreign exchange trades. See this talk for a good introduction.

They’ve gotten a lot of attention lately. Investors like Fred Wilson are interested in the concept. Ethereum is an ambitious new altcoin built expressly around smart contracts. Even the Financial Times mentioned them in a broad take on Bitcoin.

Despite the hype, there are several reasons why we’re a long ways away from seeing any significant adoption of smart contracts. First, major UI and UX issues must be overcome. The official Bitcoin client only supports the simplest kinds of transactions, but even that much is confusing to people. Smart contracts will be far more so. Second, many of the proposed uses for smart contracts rely on real-world data inputs, like the winner of an election or sports game. These data have to come from a trusted source, so it’s not obvious what the advantage is over trusting a centralized bookie under the simpler transaction model. Finally, to use the typical example given by smart property proponents, why would you want your car’s ownership to be stored on the blockchain? With the frequency at which Bitcoins are lost or stolen, I’d rather trust the legal system whenever possible.

The solutions to these problems will be complicated. Smart contracts will be relegated to niche uses for now. But they may be the most interesting case to watch in the long-term.

3  Economy / Gambling / — new dice site — ~0.5% house edge! Great on mobile. Come try it out. on: August 19, 2013, 08:05:43 PM
Hey everyone, I've been working on a new dice site that I'm ready to share with you. Here's what MadPay offers over the competition:

  • Small house edge, about 0.5% (only higher on the 100x odds)
  • The simplest interface, usable from mobile
  • Try it for free with play money
  • All off the block-chain
  • Reputable ownership
  • Provably fair

Would love it if you gave us a shot. For the first fifty users, or if you post good feedback, I'm happy to throw some BTC (say .1 BTC?) into your account to play with. Just post your username.

Any feedback?


4  Bitcoin / Bitcoin Discussion / Bitcoin is Deflationary, and That's OK on: May 22, 2013, 12:28:35 AM
New post at

Despite the polarizing question of Bitcoin's future, we can say with certainty that particular arguments on the subject are good or bad ones. One bad argument that has been making the rounds lately says that the protocol's fixed, finite supply of coins makes the cryptocurrency useless as a medium of exchange, because it would induce a deflationary spiral.
The argument goes: suppose, for the sake of contradiction, that Bitcoin has become used as a medium of exchange. This usage would presumably be increasing over time, similar to how the world economy grows overall. Perpetually increasing usage, when the supply of Bitcoins is fixed, means the value of each Bitcoin must also be perpetually increasing. But if their value is perpetually increasing, no one will want to spend their Bitcoins, because they'd rather hold on to them and capture that appreciation. Therefore, they won't be spent after all, so Bitcoin cannot work as a medium of exchange.

First of all, the present value of a perpetually appreciating asset is not infinity. Consider real estate. Like Bitcoins, they aren't making any more of it. It has major instrinsic value, which is growing, since they are indeed making more people. Yet the present value of a piece of real estate is clearly finite. That's because money in the future is worth less than money now, and people intuitively (and economists, mathematically) model this when valuing something.

Second, there is a liquid market for Bitcoins. The existence of this market distinguishes Bitcoin from any of the supposedly relevant historical examples of deflationary spirals. And the existence of a market price shows that people value Bitcoins differently: for every buyer, there is a seller. And someone who sells a Bitcoin for X would have been equally happy to spend it on something they value at X.

Third, the marginal utility of money is diminishing. Put simply, as a person's wealth increases, they want to spend more. As someone's Bitcoin wealth becomes worth more, each part of it becomes worth less to them. This is especially true because Bitcoin is one asset among several that someone is likely to hold, with its own risk profile.

Those are the fundamental flaws in the deflationary argument. In practice, people make several more, such as ignoring the time-value of purchases, conflating volatility and market corrections with deflation, making claims from society's perspective instead of the individual's (e.g., saying inflation is a good kind of taxation), and of course, ignoring the empirical fact that people are spending their Bitcoins.

There are real flaws with the Bitcoin protocol that detractors could focus on. Deflation isn't one of them.
5  Economy / Auctions / Domain: on: April 15, 2013, 02:07:43 PM
Hi, I'm posting here to gauge the interest in this domain I own. Looking for at least 4 figures here. Any takers?
6  Economy / Gambling / Welcome to Mini-Lotto Mayhem! on: April 15, 2013, 01:56:40 PM
We've launched a new Bitcoin lotto site at!

Mini-Lotto Mayhem turns every single block of the blockchain into a new lotto. We take all the transactions sent to us in that block, and from among them, pick a random winner who gets the whole pool, sans a 1.9% rake.

We're pretty excited about this idea and would love to know what you think of the site.

7  Bitcoin / Meetups / Seeking sponsor for San Francisco party on: April 10, 2013, 08:40:09 AM
Hi, I'm the creator of the San Francisco Bitcoin Social meetup group:

We're having a party in a few weeks to celebrate the $100 mark.

If any companies or Bitcoin-related services are interested in sponsoring the party, let me know!
8  Bitcoin / Bitcoin Discussion / San Francisco Bitcoin Meetup -- Thursday, June 28 on: June 23, 2012, 01:36:37 AM
9  Bitcoin / Bitcoin Discussion / San Francisco Bitcoin Social #2: next Thursday, October 20 on: October 14, 2011, 06:57:11 PM
10  Other / Archival / - on: September 15, 2011, 02:23:28 AM
11  Bitcoin / Bitcoin Technical Support / Client pegs my CPU on: September 14, 2011, 11:48:23 PM
The official Bitcoin client always pegs my CPU to 100% when it's running. This makes everything run slowly. Other people don't seem to have this problem. Any ideas?

Running OSX 10.6.8, client version 0.3.24-beta
12  Bitcoin / Bitcoin Discussion / on making Bitcoin more anonymous -- thoughts? on: September 12, 2011, 05:47:38 PM
Bitcoins are not anonymous, but they can be made more so. All existing "laundries" are ineffective. These are my thoughts on why, and how an ideal anonymity-strengthening relay (ASR) might work. I'd been waiting to post this until I reached more definitive conclusions, but Kaminsky's announcement of BlitCoin ( made me think it was better to get a discussion started earlier. A more secure Bitcoin is a more useful Bitcoin. There are just a couple ideas here, mostly obvious, taken to their logical conclusion.

The existing so-called "laundry" services work as follows: Coins are sent in, possibly from multiple origin addresses. The laundry mixes them around with other addresses, ideally shared between multiple ongoing launderings, and then send them to the destination address (provided out-of-band) in one or more transactions.

No matter how cleverly a laundry mixes up the coins, though, X coins go in one end and X coins come out the other. This might be obfuscated by using more transactions, using more intermediate addresses, or spreading them out over time. but ultimately a sufficiently motivated adversary can calculate X and identify the corresponding input and output transactions. To the right algorithm, current laundry attempts are nothing more than an inconvenience. Making the intermediate transactions more wild may even be counterproductive, leaving an identifiable pattern in the block chain. Rather than security by obscurity, our ideal ASR would rely on a simple yet rigorous design. Here are three changes that I believe would get us to such a solution:

1. Multiple outputs in the same amount. Consider two people sending transactions through the ASR, in amounts X and Y such that X > Y. If the ASR forwards to output addresses A, B, and C Bitcoins in the amounts of Y, Y, X-Y, then the addresses A and B and have, to an extent, been anonymized. With existing laundries, there would only be two outputs, which ultimately have balances X and Y, making the transactions traceable. This type of operation can (and should) obviously be generalized to more simultaneous inputs and more output addresses per input. Notice the two things our ASR needs: support for multiple output addresses (ideally, unlimited), and volume. Attaining volume means low or nonexistent fees, and usage for a variety of transactions, maybe even those that don't need security (more on this later).

2. Outputs of as few amounts as possible. Anonymity is not binary, but a spectrum: the coins from the example above are "2-anonymized", meaning that there are two possible origins they could have come from. The more outputs in the same amount, the better. Therefore, the fewer size-buckets we can put our outputs into, the better. It would be nice to have some defined set of buckets that is small, but can conveniently accommodate the full range of Bitcoin amounts (1 Satoshi to 21M Bitcoin). There's a tradeoff here: we want fewer buckets (for security), but more buckets would allow us to use fewer output addresses per transaction. An exponentially distributed set of buckets (…0.1, 1, 100, 1000…) is an obvious solution. Using base-10 is a good choice because it's secure, easy to understand, and matches the protocol, but base-2 is also reasonable and would require fewer output addresses.

3. Different levels of anonymity. Different ASR use-cases need different levels of anonymity. Many transactions don't need any at all. By using the ASR anyway, low-security transactions can provide liquidity for high-sec transactions. So ideally, every Bitcoin transaction should be sent through one or more ASRs. Our ideal ASR should let you choose, along with your destination addresses, a desired security level and possibly a time limit. For example,  low-security transaction might require the ASR to make it 1-anonymized (i.e. not at all), but offer to let the coins wait for up to an hour before being output, in case they are useful in providing anonymization liquidity to another transaction. A high-security transaction might ask that as many coins as possible be 5-anonymized, with the remainder going to a designated "overflow" address (possibly for later retry) if they can't be secured within the given time.

The ASR should of course have an API allowing users to creating input/output bindings with all the above mentioned parameters, in addition to a time limit for how long the created binding should be retained in memory (for security). Integrating this API into everyday Bitcoin services would improve the security for everyone.

I've avoided the subject of transaction fees and funding the ASR, but these can be addressed pretty trivially. I've also avoided talking about how outputs would be timed, but a batch approach seems safe, while a "randomized stream" approach seems tricky to make truly secure.

There are a number of obstacles to the creation of such an ASR.  Trust in the ASR is perhaps the biggest. The ASR would have to be trusted to not steal coins; this could come with time. It would have to be trusted to be secure, and securely erase input-output associations, or else there would be no gain at all in anonymity; this could be addressed by using multiple chains ASRs for a transaction.

Increased transaction times would be one inconvenience. Client support is another, and would probably be critical to get people using long lists of output addresses. (You could enter the amount to get a string combining multiple receipt addresses, and the sending side could support the same packing format.) 

The ASR would have to maintain transaction volume in order to provide transaction security. This is something of a chicken-and-egg problem. One way to address might be to start by only supporting outputs of one size (e.g. 10 BTC) and expanding from there.

Finally, users have to be careful not to de-anonymize their Bitcoins. If the same coins get sent through too rapidly, it's probably just noise, and transactions nearby in time are less secure. Or, the user from the example in (1) could combine their coins from outputs B and C.

For the future, improvements to anonymity could even be incorporated into the next iteration of Bitcoin protocol. Though this would require more thought, something like: only allow addresses in some small set of sizes (e.g., powers of 2), and don't allow multiple inputs to an address, except to combine two smaller values. The obvious downside is that many destination addresses would have to be provided for common amounts. As above, client support on both ends would greatly mitigate this inconvenience.
13  Bitcoin / Bitcoin Discussion / San Francisco Meetup 9/21 on: September 09, 2011, 08:33:23 AM
The SF Bitcoin Social Meetup has chosen a day for our first meetup. It's going to be Wednesday, September 21st, probably somewhere in the Mission District. We have confirmed attendees from ExchB and TradeHill! Check it out at
14  Economy / Services / is back online! (buy bitcoins with Google Checkout) on: September 07, 2011, 08:03:36 AM

All it says is "*** after some dumbness, btcnow is back online!! ***", and the price is currently $8.5/BTC
15  Bitcoin / Bitcoin Discussion / San Francisco Bitcoin Social Meetup on: September 04, 2011, 01:05:29 AM
Based on the success of our last get-together, I made a Meetup group for people in the San Francisco area. Join here:

No particular plans yet. Let's get people on board and then figure it out.
16  Other / Archival / - on: September 02, 2011, 06:13:52 PM
17  Economy / Speculation / How much daily transaction volume does The Silk Road see? on: September 01, 2011, 05:30:23 PM
Does anyone have an estimate of TSR's transaction volume? As the most visible part of the Bitcoin economy, tracking this could help predict the BTC exchange rate.
18  Bitcoin / Bitcoin Discussion / San Francisco Bitcoin Social this Wednesday night on: August 29, 2011, 06:51:35 PM
If you live near SF and want to get together for drinks with people who like talking about Bitcoin, email me:

We're meeting this Wednesday night. So far it's just two or three people, but I thought I'd post here and see if anyone else wants to go. Probably around 7pm in the Mission. Hope you can make it!
19  Other / Beginners & Help / My yet another "What is Bitcoin" blog post on: August 24, 2011, 10:32:40 PM
I'm aware that there are a ton of posts like this, but I wanted to get my thoughts down in writing.

Feedback welcome
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