They could very well modify and improve their "inactive account" algorithms to profile smart/stupid people based on habits, useragent strings (geeks use linux or something lol), etc. It could leave the inactive accounts that belong to smarter clients in the holdings report, and drop the accounts that belong to what the system believes to be stupid people. It would drastically reduce the chances of getting caught.


I should clarify. I meant for their own internal statistics. Spends per hour, funded accounts, etc. If they excluded inactive accounts from their statistics (well, they fall off the stats because they are inactive) they could use that as an excuse for excluding them from a published holdings report when "called out" by the public. (Blame it on a software bug.) Those unreported coins could be siphoned off by spending the difference to a new master bc address and publishing a bogus report. The bogus report would check out and the BBE would confirm that the total holdings match the bc address.

They could even put up a hash checker on the same page. When someone goes to calculate their hash with that handy tool it would just add them to the list on the fly (assuming they aren't already on it), and move the activity date up on the account. lol! I just thought of that one.

Of course the entire list could be published as a flat text file that is PGP signed with the date/time inside of it. That would keep it from being changed on the fly. lol


Sure, but that doesn't matter if you can exclude some users and spend those coins behind the scenes.

Anyway, it is better than nothing. I'll agree with you there. I just think there are ways to steal if one is very creative. You assume that everyone else is as skilled as you are. Most of the people who will be drawn to e-wallet systems will be people who are basically non-techs that want to use Bitcoin. They are the easiest to steal from unnoticed.

This could go on and on and I do need to sleep sometime.

Cheers!

You can't deposit 10 BTC into an inactive account and still call it inactive.

Lets say that you were proactive enough to leave 10 BTC in an account for a year just to try to catch an e-wallet provider cheating. Say the e-wallet provider published its books right now. You would have had to known this exploit a year ago. Did you really think about this a year ago? You lose.


If the e-wallet provider were caught and backed into a corner they could say that they exclude inactive accounts from their reporting algorithm because it skews their statistics or something. Most of the users would believe it was a sort of accounting mistake and keep using it. They would move on to finding another way to cheat. (We are assuming they are evil for the sake of discussion, remember.)


Again, you'd be missing spends between users at the same e-wallet company. The balances would not line up. This would not provide adequate proof of anything. Read this thread again; the part where I talked about why giving users a backup of their own wallet files wouldn't work. It's the same reason.

You'd omit accounts from the list that haven't been used or logged into for a long period of time.

Edit: Oh, and you're assuming that the e-wallet provider is storing all of the Bitcoins on one address. That may not be the case.

Sure. It can and does happen. I was merely remarking on the paradox of trust. (You can audit and auditor that audits another auditor.. ad infinitum...)

Lucky for us, we have the option to trust no one by holding our own wallets with the Bitcoin client.

Vekja.net has one too.

Hmm.. If the public could track a spend's lineage into and through an e-wallet provider, that might work. A "BBE" specific to mybitcoin, for example.

It could upset the users because it would remove some of their privacy. You'd be able to see spends between e-wallet users and tie their commerce together.

It's not an easy problem to solve. lol!

That isn't a bulletproof plan either. The e-wallet company could just lie about the number of accounts in their database so that those figures more or less line up with the BBE.

Sure. Now we are back to 'reputation' again. Why would the auditor lie and risk tarnishing their reputation?

Well, instead of just saying "it sucks"; I've decided to try to help them. It is far more constructive.

I sent Bitcoinmail the following email:

Hmm.. I guess I missed that. Thanks for clearing that up.

I still stand by my conclusion that Bitcoinmail is not the best way to introduce new people to Bitcoin.

You're right. I guess I was just a tad choked about Bitcoinmail keeping coins.


Why would I? I have no reason to.

A 3rd party audit. That's probably the best way.

I sent this email to Bitcoinmail:


I will summarize the reply: I was thanked for my suggestion and told that keeping unclaimed coins was their only source of income so they'd probably not change it. They were open to me suggesting a better way.

In conclusion, Bitcoinmail is only useful for sending Bitcoins to people who already use Bitcoin. This totally defeats the purpose of  even using it.

Edit: (Full email reply from Bitcoinmail with PGP signature removed from public view. My apologies. That was rude.)

Yes and no. I suspect that spends between users at the same e-wallet (I don't like calling them "banks".) company are not handled the same way as regular Bitcoin client spends. The wallet file backups would be incomplete or not entirely accurate.

For example, I've noticed that when I get Bitcoins from a regular client to mybitcoin's SCI I can see the amount on the block explorer. When I get Bitcoins from another mybitcoin user I don't see it on the block explorer. They must just move bits around in their database instead.

From mybitcoin's terms: (https://www.mybitcoin.com/open-account.php)


Translation: Not a bank.


Translation: The Bitcoins in your mybitcoin account belong to you.


Translation: Full reserve.

Yes, they *could* steal and plunder and be a bunch of pirates but that would ruin their reputation. Why would they put all of this effort into this project just to toss it all away?

I, personally, don't keep my Bitcoins there. I use their merchant tools because they seem to be the best ones out there so far.

That's how you market software. We are trying to market a concept. There's a huge difference.

Uh huh.

FYI: The topic of usury has been discussed on these forums before, and in great depth.

It was also frowned upon by other religions too. It was punishable by death in many regions of the world.

Earning money, just because you have money, was seen as parasitic.

Here is what I see in your future:

1. People using Bitcoinmail drive interest to Bitcoin.

2. Mass "spamming" from Bitcoinmail to different sites who consider the emails to be spam or otherwise irrelevant.

3. Bitcoinmail getting rich by keeping all of the unclaimed Bitcoins.



If Bitcoinmail took the senders' Bitcoin address and returned the funds have been unclaimed for, say 30 days, this problem would be fixed. Also the email that Bitcoinmail sends out tells the recipient to go to bitcoin.org. That's probably a big mistake.

I disagree. Full reserve holdings companies do exist, and they don't necessarily go fractional reserve "naturally".


That largely depends on the agreement that you have with the organization that is holding your money. If a breach of the agreement happened the "bank" (or e-wallet company, whatever), would quickly lose the public's trust and fast become worthless/useless.

Of course if it were done silently only a run on the holdings would make that information known. This is an entirely different topic. lol

Neither of them are "banks". They do not make loans, charge, or pay interest.