I also wonder how that compares with people's typical savings in fiat.  Dollars don't have specific transactions associated with them, but I'm sure many people keep a reserve of dollars month over month that aren't spent.  These aren't necessarily in a separate account designated as savings, but rather just a minimum balance that people and businesses try to maintain.  In any case, it's hardly a surprising figure.  Hoarding bitcoin is a very rational thing to do.

To drive the point home with my kids, they get paid their allowance by me updating a google doc spreadsheet.

Nonetheless, clients that have an automatic mixing that is enabled by default would be very desirable.  If the vast majority of clients operate in the standard way, the small amount that don't is negligible for the purpose of reverse engineering someone's economic activity.  It would be hard to imagine a company finding it acceptable that their competitors can get a fairly good picture of their activity so easily.

Confirmations just give you a risk assessment…1 confirmation by the Bitcoin network should give you a whole lot more confidence than 4 Litecoin confirmations.  The Bitcoin network has a lot more computing power protecting its network.  If there was some way you could estimate how much computing power is currently working on a block that includes a given transaction, that would be a pretty decent way to assess the risk of a transaction even before it's in the first block.  If mining pools sold subscriptions to their feed of lower difficultly blocks, you could make these kinds of assessments (you could also look at p2pool).  You could observe the mining power working on blocks that include your transaction and make a risk assessment long before the first real block.  As the mining power including your transaction increases it may cross a threshold where you accept the risk (and the threshold would be dependent on the value of the transaction).  This would be a far better way to assess the risk of a transaction than the various transaction radar approaches.

Oh, ic…I guess that's what you meant by "The client will verify this data during import." 

Any idea how long it takes to perform the validation of bootstrap.dat once it's downloaded (on typical hardware)?

Cool.  It got me thinking and questioning a few things.  I've often thought that a good alternative to downloading & validating the full block chain when bootstrapping a new client is to find a node you trust and simply copy it block chain and transaction data.  I think of this kind of like cloning a trusted node.  You can bypass a all the validation work.  

This is similar to that in the sense that you are downloading a block chain that you trust to be validated.  It happens to match the 193,000 block baked into the client and signed by the core developers (by virtue of their signature on the hash of the software download).  Since this download.dat has block 193,000 whose hash matches the one baked into the client, you can be sure of the fact that you've got a block chain that matches that which was signed by the core developers up to block 193,000.  If all the merkle hashes and previous block pointers check out, you're good to go.

But, I always thought the bulk of the time to sync up the block chain was due to transaction validation and not actually due to the download time.  When it comes to the matters of trust, could you not achieve the equivalent result by starting up the client in a mode that doesn't do full validation for blocks prior to the most recent, baked in block (i.e. 193,000)?  On startup (if it's GUI), the user could be prompted to decide whether to perform a full validation, or to trust the baked in checkpoint.  Maybe downloading through Bittorrent still has advantages (i.e. not burdening the bitcoin network with download traffic), but I wonder how the performance of this would compare with downloading via Bittorrent.

It's entirely possible that instead of anything ever getting statically priced in BTC, people start dynamically pricing everything relative to real goods instead of relative to any currency (fiat, gold, bitcoin or anything else).  As software evolves, I may be able to set my prices relative to input costs.  I could sell widget X or service Y for "input costs + 10%" for example.  I could accept payment in anything that has a sufficiently liquid market and automatically exchange my revenue for whatever asset (or combination of assets) that I prefer to hold...be it gold, silver, USD, EUR, BTC, Google stock...or pirate shares

Satoshi's white paper

People should not dismiss this point of view out of hand, especially those involved in TBF.  How is it that you defeat or neutralize a decentralized organization?  You centralize it.  This is exactly how the Sioux Indians in North America were ultimately defeated.  They formed an "entirely voluntary" centralized organization.  Their people began to defer more and more of the decision making to this central organization.  This organization naively tried to work with the government on the belief that they could reach tolerable agreements.  Later in life, Chief Red Cloud said: "They made us many promises, more than I can remember. But they kept but one--They promised to take our land...and they took it."

I don't doubt the good intentions of the people involved in TBF, but as they say, the road to hell is paved with good intentions. 

BTC is taxed just like anything else.

We actually looked into this situation specifically…the legal advice we were given was that we'd need an incorporated entity in California (or other states that permits medical marijuana) and attorneys well versed in the local laws.  It makes it cost prohibitive for us.  Of course, nothing stops them from accepting bitcoin themselves.

LOL…if true, that's really funny.

 

Some of the people involved in this foundation are a part of a cabal known as the Jekyll Island Bitcoin Society.  The secret plans of this organization are anyones' guess.  Is it a mere coincidence that the formation of this foundation follows so closely on the heels of their convening meeting on Aug 22nd in NYC?

Here are a couple additional things to note:
- bit-pay.com no longer bounces to bitpay.com (we'll re-enable it when I have more time)
- http://bitpay.com no longer redirects to https://bitpay.com (again, I'll re-enable when I have more time) …you have to go directly to https://bitpay.com

Also, one of the issues that this has created for us is that the old SSL client certificate based method of API authentication no longer works (due to the anti-DDOS proxying of connections).  We were planning to keep that method active until all merchants had a chance to migrate.  Unfortunately we've not yet had a chance to upgrade all shopping cart plugins to use the new API key based method of authentication.  If you're using one of our shopping carts and are unable to process a checkout, send me a private message.

We cannot elaborate on any specific information like this.

This really depends on the attacker at this point…we'll keep trying to bring the site back online and improve our anti-DDOS capabilities as best we can…I expect he'll continue to attack.  There's really nothing else we can do.

You infer a lot...I was not describing a utopian world.  I was suggesting that fractional reserve banking may not be the most efficient means of making capital available to borrowers.  And, as a result, I think it will become less prevalent in the future (irrespective of bitcoin's success or lack thereof).

I'm not sure exactly what you're referring to, but I didn't mean to imply that bitcoin would take over the entire market for monetary instruments.  I meant when bitcoin is simply being used for exchange and savings rather than as a speculative/growth investment as it largely is today.

There is no doubt that lending is important, I'm not arguing against it.  What I'm saying is that fractional reserve banking is a less efficient model for making capital available than a typical share based model.  Regarding a "market interest rate", I'm not sure what you mean by that since all debt or investment carries some risk.  So, talking about about a market interest rate in the absence of the risk associated with that interest rate doesn't make sense.  If you're talking about the "risk free rate of return" often discussed in the context of government bonds, I'd argue that this too is an antiquated concept when examined next to Bitcoin.  When Bitcoin fully saturates the market (everyone is holding has much as they want to hold and using as much as they want to use in transactions) and is past its growth phase, the value of a bitcoin will rise and fall as people's preference for savings vs consumption (or riskier investment) changes.  The higher the preference for consumption or riskier investment, the lower the value of a bitcoin…the higher the desire for savings, the higher the value of a bitcoin.  This essentially serves the same function as treasury markets (where the interest rate paid is measured against inflation to determine a real rate of return, or some objective measure of value).

One other thing…people have debated with me in the past that the fantasy created by the fractional reserve model induces (aka dupes) more people into lending and that without it, there wouldn't be as much capital available.  While it might be true that more people would be lenders under a fractional reserve scheme, consider what that means for the rate of return for those that do lend.  Due to constricted supply, the yield available to lenders should be much higher…given high yields, I don't think it would be long before most people figured out that lending was a much better way to park their savings than bitcoin itself (again, we're talking about a time when bitcoin is beyond its growth phase, where the investment in bitcoin itself may be the best place to park savings).

Exciting times for certain.