Initial difficulty is set in the genesis block.  Changing it for the Bitcoin chain would cause an immediate hard fork as all subsequent blocks would be invalid.   

This.  Casascius brings up some good points.  I would also add that the eGold management embezzled tens of millions over the course of a decade from the trust.  When the govt seized the assets there was insufficient physical gold to pay the balance of user accounts.  Given that in any reserve system it is improbable that all parties will withdraw at the same times it becomes very easy to engage in this type of fraud.  My gut feeling is if users attempted to withdraw 100% of the funds from Liberty Reserve it would likewise fold.  In BTC4Victory example of legal victory what happens when the trustee and the gold are all gone.  He hopped a seaplane to a non-extradition country with $50M in Gold Bullion.  Or even better he sold the gold locally for Bitcoins and hopped on a plane with this brain wallet. 

The largest advantage of Bitcoin is that it enables commerce without a trusted third party (note you still must trust your counterparty).  Any schemes and constructs which must rely on a trusted third party don't need Bitcoin.  If you trust PayPal to always do the right thing (protect your rights as seller/buyer, always give you immediate access to your funds, never succumb to political pressure, etc) then you don't need Bitcoin.   Chaining Bitcoin to some to some cludgy implicit trust system backed by a corrupt and failing legal system is like buying a Quantum Computer to acts as a space heater.

ASIANS Historical Relics, financial services, and microprocessor design Ltd.

He figured he would be long gone before the card got reported stolen? 
Maybe he was just unlucky the card got reported quickly.

Simple version.  The wallet.dat just contains your private key*.  You sign over ownership of coins** sent to your addresses to the new owner.  The transaction records the transfer of ownership.  To prevent someone else (say me) from transferring your coins for you (to my wallet) the network verifies that the transaction is signed by the private key of your address(es).

Every one of your addresses has a corresponding private key.  The magic of ECDSA (and all public/private key encryption) is you can share the public key and keep the private key a secret.  This ensure only you can sign messages with the private key but anyone can verify those messages with the public key.   You don't actually ever send or receive coins, you ANNOUNCE to the world the ownership change.  

Kinda like the digital equivalent of:

later when I spend it:





* Technically it contains more but that is merely to prevent a need to recreate the wallet on each startup.  The private keys are what can't be replaced.  They are the secret part.  If you delete your wallet.dat and don't have a backup it is the lost private keys that you will be crying about.  There are no coins in your wallet, your coins are "safe" the only problem is without access to the private keys you will never be able to transfer/spend them.  You can forever view them on the blockchain if you like.

** Coins are actually an abstraction.  The network works on the concept of inputs and outputs.  All transactions (except newly minted coins) have as their input the output of a prior transaction.  When your wallet says "you have 20 BTC" what it really means is "I have done an exhaustive search of the blockchain and the the combined sum of the value of all the unpsent outputs assigned to addresses for which I have access to the private key total 20 BTC".

No.  But then again I dind't know Tosaki (the original Tosaki) was or wasn't German.

Very shady to sell site, forum accounts, email, etc to a new entity without making it public.   Lying (by omission) doesn't exactly inspire confidence.  I won't be using bitmit in the future and I have been an early supporter.

Well this is going to get ugly.  Such a horribly bad announcement means that chargebacks/refunds (which were already going to increase significantly) are likely going to exceed cash on hand.  Then what?  I mean the not so hidden truth is all the ASIC companies have been operating a "fractional reserve" of sorts.  By spending some/all the pre-order funds to get product out the door they simply can't handle more than a certain % of refunds.  What happens when the number of requests exceed that %?  I don't know for sure but I think we are about to find out.

D&T rules of business (now available on amazon and kindle)

I think you are confused. 

1 confirm = "Included in a block"
2 confirms = a block found after the block the tx was included in.
3 confirms = 2 blocks found after the block the tx was included in.
....
n confirms = n-1 blocks found after the block the the tx was included in.

DOH.  Too early and not enough coffee.  The first part is still applicable though.

Because at the same time velocity fall off a cliff.  Monetary velocity is (simple version) how many times a single unit of currency is exchanged annually.  So if customer pays your employer $100, and your employer pays you $100, and you pay the grocery store $100 and the grocery store pays a farmer $100 even though it is the same "$100" you have a velocity of 4.  The effective money supply is roughly 4x higher.  So while the FED is rapidly expanding the monetary base the velocity is also falling.  Kinda like trying to fill the bathtub with the drain open.

As someone above pointed out the FED isn't actually putting money into the hands of the people.  It is putting money in the hands of the banks, who in theory should lend it out and increase the effective money supply however due to the FED other actions it is very profitable for the banks to simply borrow money from the FED use it to buy govt debt and mortgage backed securities.  Kinda hard to not make money if you can borrow a (nearly) unlimited amount at ~0% and collect interest at 2% to 4%.    Ironically simply having a free "lottery" where the winner gets $x dollars on a VISA gift card which must be spent within 365 days would be far more effective then handing ever increasing quantities of money to the banks to do "nothing" with it.


So money supply has exploded but no price inflation because the money is being circulated less.  However if the economy did finally pick up and velocity jumped to normal rates before the FED could soak up that excess money supply you would see massive inflation.  Probably not hyperinflation but price inflation in the high teens like the early 80s are certainly possible.



To use an analogy imagine if people are cold so the FED solution is to soak them with gasoline.  They still aren't warm so the  FED keeps dumping more and more and more gasoline.  Weeks, months go by and nope people aren't warm yet so the gasoline soaking continues, entire neighborhoods soaked with gasoline, businesses soaked with gasoline.  Tanker trucks of gasoline are brought in and 24/7 spraying of gasoline everywhere continues.   When the people complain "hey we are still cold", Ben Bernake's answer is "eventually there will be a spark and everyone will be warm".

Um guys the fed has "printed" ~$2T out of thin air in the last five years (Fed's balance sheet increased from ~$800B to $2.9T).  If we include the Fed's off balance sheet (magical money they print out of nowhere and lend to foreign central banks so for some reason it doesn't count on the "official" books) it is closer to a ~$4T expansion.

This is the part where D&T fails reading comprehension. 

Now the stupid ~$1T coin will never be made but not for the reason the Senator thinks.   The FED isn't in the business of giving away money.  The FED LOANS money.  If the FED produced a ~$1T coin and loaned it to the treasury it would be no different than the Fed buying $1T in govt bonds.   Either way it is a loan = debt = included in the debt ceiling.   Hell if the FED just wanted to give away money well they could simply buy some government debt and "vanish it".  Tada govt has $1T, $2T, $10T, $15T less debt.  It's magic.  No need for stupid coins to do that.

A D&T public service announcement:  
To date every single new seller of moneypaks or gift cards in bulk at steep discounts has resulted in a scam.
MoneyPaks are cash.  Ever seen someone offer to sell you $100 bill for $65?  

spambots can harvest it directly from the PGP keyservers.

MIT search engine is for the name of the key not the keyID.

For example our company KEYID is C26C17CD searching for that yields nothing but search for Tangible Cryptography and you will find the C26C17CD key.

When manually uploading the key (which you likely don't need to do) you must copy the ENTIRE public key.  The KeyID is merely an identifier it isn't the key.  Think of it as a serial number for the key.

For example, our company key

KEYID (short version): C26C17CD
KEYID (long version): 28BB715FC26C17CD
Fingerprint: 3AF3 01A1 91EC E112 621C  ACC0 28BB 715F C26C 17CD

Actual Public Key

Why don't people learn?  Nobody, I mean nobody has an endless supply of 50% off gift cards/codes.  Nobody.  Ever.  It always is a scam.  Period.

Now someone selling a SINGLE gift card ("hey I got this stupid Best Buy card and I never ship there 50% off OBO") might not be a scam but someone saying "Hey I got an unlimited supply of $100 BB gift cards for $50 in BTC" is always a scam.  Strangely it always works.  Also escrow is no protection from this type of scam.  As seen the scammer will gladly accept escrow because he has every intention on delivering a code ... it just happens to be a code purchased with a stolen credit card.

It is unlikely there are that many nuclear devices unaccounted for.  Also many unaccounted devices are simply irrecoverable. Devices that were lost at sea (submarine accidents) may have sank thousands of feet below their crush depth.  The weapon is "lost" and will never be recovered but nobody is going to use it as a weapon.    

The biggest obstacle is that modern thermo nuclear devices require a never ending army of maintenance technicians.  Any device lost more than a decade ago would require some very sophisticated experts and access to precision equipment, tools, and material to get it weapon ready again.   A nuclear device is continually undergoing nuclear decay and has lots of volatile components like deuterium and tritium gas (which slowly leak through just about any barrier made by man).   Combine that with unstable components like precision timed implosion explosives, triggers, a neutron emitters and you have a device which doesn't "age" well.  The nuclear decay continually warms the device (like a never ending 200W lightbulb) which leads to problems like drying lubricants and explosives.  Eventually even the metal will undergo fatigue from the continual neutron bombardment.  In theory weapons are designed with a strong link, weak link design so that internal system failures will break the weak link first and render the device inoperable (rather than having a volatile unpredictable device and still operational device).

The US spends about $30B a year to maintain these ancient killing things.  This is a cost which will continue literally forever or the weapons will eventually become nonfunctional. 

Bitcoin does the same thing it is a safety mechanism to prevent for a griefing attack.  It is much less likely now but imagine back when CPU mining was common.  A massive botnet or supercomputer could mine a difficulty interval so fast it would cause the difficulty to shoot up 100x.  Then they could simply stop and Bitcoin would die a death of starvation with the average block time being 16 hours and the time till next difficulty reset something like 4 years.

HOWEVER.  Satoshi did some benchmarking and chose a starting difficulty that would require roughly a dozen computers.  Bitcoin was less popular than that and as a result difficult remained 1 for months before it gained critical mass to move difficulty up.   FRC either through ignorance or malice chose to keep a difficulty of 1 despite the average node now being able to mine 500x faster.  It would have been like Satoshi picking a difficulty of 0.002 and as a result mining 20% of the coins himself in the first week.

Well no initial difficulty didn't need to be set at 1.  Given that per processor hashrate has grown by a factor of 500x since Bitcoin was launched (unoptimized non-OpenCL CPU code vs highly optimized OpenCL GPU miners) it is kinda insane one would choose to launch with a difficulty of 1.

Of course a difficulty of 1 means that rather than the first 8,000 blocks taking 3 months like Bitcoin it took less than 48 hours and those who participated in those early 48 hours when almost nobody knew the coin existed were able to mine at 30x faster than the targeted rate and those who mined in the first 4 hours mined at over 70x the targeted rate.

That is a silly concept.  Of course $5K vs $10K will matter just as much as $5 vs $10.  Other currencies is something you can buy with BTC.  Even if most trade is in BTC directly traded for goods and services it won't change the fact that prices will adjust to a change in the exchange rate.

Hypothetical example.  Say BTC exchange rate is $5K USD = 1 BTC.  You find a car dealership which sells cars in BTC.  You find a nice car you like and the dealer offers it to you for 10 BTC.  You shop around dollar based dealershps and find this is a relatively good dea  (most other USD based dealerships are selling same car for ~$50,000).  Fast forward 5 years and you decide to upgrade to a new XYZ model which most dealerships have for ~$70,000.  You go to your friendly BTC dealership and he wants 10 BTC.  But wait you could SELL the 10 BTC for $100,000 even with exchange fees, buy the car at a USD dealership and pocket the other $29K+.

As long as product xyz is offered in both USD & BTC the prices will fluctuate based on the exchange rate.  Otherwise one side or the other is getting a bad deal and the side getting the bad deal can simply opt to sell/buy on the exchange and trade in the more favorable currency.

Now with a price of $5K we are talking a coin supply worth ~$100B and thus it is likely the deep liquidity will make volatility much less.  Merchants may not have to adjust their prices very often because the daily exchange rate might only vary by say 0.2% or less.  Still a rise (over weeks, months, or even decades) from $5K to $10K will require adjusting prices it is illogical to think consumers would opt to (as an example) get a $70,000 car for 10BTC vs selling the coins and getting the same car for 7 BTC.

Bid/Ask at beginning of thread was B:0.5 | A:1.0  (BTC per 1K FRC)
Now it is B:0.2 | A: 0.3

How low can it go? Think we will see 0.1 per 1K by the end of the week?
The good news for the "foundation" is that even at 0.1 per 1K their 80M FRC is worth > $100K USD.