Worse still is the sheer number of users in the relatively tech-savvy USA who stand to lose a great deal when the hammer finally falls.

If I understood the crypto design correctly,

Now, this is interesting!  Firstly, any hypotheticals I put forward here are hinged on an indefensible and indeed unlikely premise, and another one that defies one of the most obvious design goals of bitcoin - that the federal government could be tempted to abandon the banking establishments with the lure of how easy it would be for a governing body to track and control the movement of bitcoins for the purposes of maintaining a healthy and stable government, were they to be centralized.  

The next thing I lay down is that, the currency of a country's populace must be taxable for that country to survive.  Period.  We, the people, must be taxed, or we can have no government.  "Hooray!",  say the Anarchists, until their murder and pillage by some stronger and better armed Anarchists.  We need our government to be capable of protecting us from harm and to safeguard our well being.

That established, all that would be required for the taxation and regulation of bitcoin usage is to do the unthinkable and centralize it, requiring communication with federal servers to track and verify bitcoin exchanges.  What if the miners connected to these servers in one massive, publicly driven pool?  This would afford Bitcoins all of the benefits of Bitcoin usage except for the purchasing of illegal goods and services.  Banking establishments - the real enemy, here - would simply be written out of the picture, as safeguarding one's life savings is as easy as stashing an encrypted CD containing one's bitcoin wallet, freeing my country from the shackles of bondage that is rapidly annihilating our middle-class.  Inflation, thanks to the powerfully designed preventative measures inherent in Bitcoin's structure, might well still become a thing of the past under such a scenario, although some unconscious part of me suspects that the deflationary measures are in a twisted way hinged on their exchangeability with the inflating USD.  I can't put that worry to words just yet, so don't ask.

Finally, the decentralization of how bitcoins are "printed", coupled with the grotesque difficulty involved in counterfeiting, would revolutionize the stability of what I'll now call the "US-B".  Really, this situation contains all the benefits of the Bitcoin except the inherently anarchistic ones - most notably the traits that the folks I've argued with all afternoon in this thread value the most.


And that ends that fantasy.  The more I think about this, the more damned Bitcoin seems in my country.  That scenario can't happen - power structures loathe change as buildings loathe earthquakes.  The banks have my country by the balls, and Bitcoin's pseudo-anonymity can't stop it.  

And similarly, does anybody now have any idea of how a currency could be more pure then bitcoin if only we had the technology?

Hi! I'm the guy behind blindbitcoin.com See: http://forum.bitcoin.org/index.php?topic=12751.0

You are all correct in saying that my site is a glorified bitcoin laundry. That's exactly what I intended it to be. The whole purpose is to have a transparent, no-trust-required bitcoin laundry. I hope people find it useful!

Exactly right. I will to do what I can to help the police catch scammers and crooks who want to steal from people.  The police might use those same tools and techniques to help catch people who use bitcoin to pay for drugs; I can't stop them from doing that.

I personally don't think drugs or gambling should be illegal, because I believe you should be free to do whatever you like with your own body and your own money. But I also believe those are separate issues from bitcoin, and if I felt really strongly about it (it isn't one of my own personal hot-button issues) I would be donating money to, or volunteering to work for LEAP and NORML, not mixing "bitcoin is a great new technology" with "drugs should be legal."

I like the idea of offering campaign contribution in bitcoins (if it were legal)


Very difficult to say no to money, one thing all politicians have in common

I would imagine it's difficult to find a candidate that does not have traditional banking friends in high places though.

I've been thinking of how to react to this story, and am tempted to appeal to people's greed/fear with a message of "your country may miss out on a huge new opportunity and be left behind if you try to stamp out innovative new technologies like bitcoin."

what happends when you firstupdate before 12blocks? i lost the 25btc but cant see it in my list, is it lost or will it update when the blocks are done?

So they use different installation directories, different 'appdata' directories, different copies (if any) of libeay32.dll... i.e. Installation and use are 100% separate?

I wasn't sure how much this relied on a bitcoin installation, if at all... I suppose that you could use Namecoins even if you have never installed or used bitcoin?

I guess it's the phrase 'based on Bitcoin' that has me asking all this.

Namecoin is the currency used to perform maintenance & register domain names for .bit addresses. It's the only currency that the system accepts (intrinsically) and is mined in the same fashion that Bitcoins are mined.

You are clearly correct on your underlying assumption: Bitcoin is similar to gold in that, at equilibrium, it tends to have the same value as the work needed to create it. If by a thought experiment we equate the value of all goods and services with the market capitalisation of Bitcoin we have a full blown eco-catastrophe one our hands: I computed that if Bitcoin were to replace the USD monetary base somewhere in the next 10 years, minting bitcoins would suck up 70% of US's electricity production at current prices.

So Bitcoin is a quite inefficient format of money but I wouldn't go so far as to say "all the society can buy is the value of bitcoins". Once mintend bitcoins have an unlimited shelf life and can participate in an indefinite number of transactions. For the first transaction the global "fee" imposed by bitcoin is 50%, for the second 33% and so on. This is the same way a limited supply of USD monetary base (~2trillion) can participate in a 14 trillion GDP every year.