I just closed a deal a few days ago, to buy 10 XAG for 10 BTC. This was when they were pretty close to parity. I'm sort of curious to see if the guy will come through.

From a formalist perspective, many (though not all) bodies of law have restrictions against retroactive criminalization or punishment. The United States is one of these---the constitution forbids ex post facto application of law.

From a realist perspective, this hasn't stopped the government from slapping ever-more-arduous restrictions on people convicted of sex crimes, even if those crimes were committed thirty years ago, because being forced to live under a bridge after you are pushed out of every residential zone and forbidden to leave the county isn't "punishment." There's nothing to stop the legislature from passing a 500,000% tax on all e-currency income, defining "e-currency" so narrowly that Bitcoin is the only one in existence, and applying this to the 2011 tax year. This would probably be upheld by SCOTUS since they've been so willing to interpret the law in a robotic manner in the past (see their decision that any finite number of years is a "limited term" w.r.t. copyright---thus the next copyright extension will probably be to 100,000,000,000,000 years). This would effectively ban the use of Bitcoin in the United States, retroactively to January 1.

The problem with using "Well, are you buying?" as a metric is that a lot of people here first bought in at like $0.50 or so. If someone invested $1000 at that price, they're already well over $30,000 in at this point. $30,000 is more than my annual stipend as a grad student. If I had that much invested in one instrument, then no, I don't think I'd be looking to put more money into it.

What bitcoin server?


Because it's best practice for any business. It allows the receiver to say, "These 10 bitcoins were sent in payment of this invoice," because that invoice listed that address for payment.

This isn't really money laundering. Money laundering is about taking earnings you can't put on the books for whatever reason, and turning it into money you can put on the books, so that you can spend it without raising eyebrows at the IRS. With this, you put in a bunch of bitcoins and get a bunch of bitcoins, and still can't explain how you got them.

Man, I wish I'd blown all my savings on mining rigs at the start.

Solo mining doesn't require any additional bandwidth, because the transactions you are trying to process into a block are the ones you are being sent notice of anyway. You don't have to receive anything you wouldn't receive otherwise, and you don't have to send anything unless you actually succeed in creating a valid block. The network doesn't even have to "send" your block reward---you put that transaction directly into the block you generate.

Pooled mining does require some additional bandwidth, because (1) the difficulty is artificially low, so the client submits "valid" hashes far more often, and (2) the server has to send updates to the clients as new transactions come in or new blocks are mined. Even then, there's no need for clients to send or receive more than a few tens of bytes per second on average---it's the servers that have to worry.

I was thinking the other day about how an exchange could operate without revealing the identities of its users. Running it as a Tor hidden service would be the easy part---the hard part would be how to deposit and withdraw USD. I came up totally blank on this. All I could come up with was to generate contracts and have the individuals work out the details of delivery, and the potential for fraud is too high there. I don't really know how Ripple works, but maybe that would be a possibility?

An alternative to a hidden service is just to have exchanges operating in as many sovereign territories as possible. There has to be some government that recognizes, if not the potential of Bitcoin, at least the potential influx of foreign capital from allowing legal exchanges while their neighbors don't.

Either way, the easiest way to set up multiple exchanges is by freeing the code so it can be spammed across the internet. I don't know if any of the existing exchanges will be freeing their code anytime soon, so a "Free Exchange Project" may be in order. I haven't done any serious coding since... well, ever, but I'd be interested in at least following something like this.

I like the idea of commodity-based exchanges like BTC/XAU, but they have the same deposit and withdraw problem.

I don't really think Bitcoin will be banned anywhere in the near future, because most people still aren't taking it seriously. Senators Schumer and Manchin seem to be exceptions, and yet they still don't take it seriously enough to find out what it actually is. Our little economy is still only about 30% of the way from "joke" to "threat". But for those invested in the project, it's still worth thinking about this sort of thing in advance.

FWIW, Jessy, I'd be surprised if there's any criticism of your post. Even if someone had a personal problem with your business (which I don't think most people around here do), it is legal, which is what the "holier than thou" contingent seems to be going after.

I'm not in NYC and I'm pretty vanilla anyway, but established brick-and-mortar businesses accepting bitcoins, even niche businesses, is only good news to me.

D'oh you're right. Sorry.

My attempt to answer like an Anti-IP Libertarian:

Copying someone's wallet file isn't theft, but emptying it is. Theft takes the use of property away from its owner, "IP theft" does not.

That's still about three cents. Why not 0.00001? 0.01 was fine when we were at 0.3, why is 0.00001 too low when we're at 30?

The phrase "BITCOIN IS LIKE CASH" needs to be drummed into people from the day they download the client, if not sooner.

If you lose your cash, it's your problem.
If your cash is destroyed in a fire, it's your problem.
If you lock your cash in a safe and lose the key, it's your problem.
If you give someone your cash and he doesn't deliver, it's your problem.

But I agree that right now most people can't keep their wallets safe. Most people never back anything up, and eventually lose all their data as a result. Backup solutions are getting better and easier to use, but most people still aren't using them. Hell, I should know better, but I didn't get a wallet backup into place until I noticed that with the appreciation I suddenly had a lot of money invested in them, and I still don't have a real system.

There may actually be a business opening here for a secure wallet backup service that uses client-side encryption. (The client software would of course have to be open source, to prove it really was encrypting the data.) But then we'd still be trusting ordinary users to know the difference between a legitimate backup service and a scam. Personal responsibility is always dangerous in this way.

The block chain is what keeps Bitcoin secure against forgery without the need for a central server. Miners compete to put verified-valid transactions into blocks. Because clients assume the longest block chain is the correct one, double-spends and other forgeries are doomed in the long run unless someone can produce a block chain faster than the rest of the mining network put together. The block reward is a way to get lots of people to contribute to this.

Honestly I think it would be really stupid of anyone to say here that they intend to break the law.

That said, if the use of Bitcoin were banned in my country, I would strongly consider expatriation. This is one reason why I'd like to see at least one nation declare the use of Bitcoin officially hunky-dory.

Given that we're within spitting distance of XAG parity, I think a good way to celebrate might be to trade some bitcoins for 1oz silver rounds, 1:1. I'm looking for 30 - 40 oz altogether.

I don't expect anyone to fill this offer now---I'm just making it now so that someone can possibly accept it later.

Might try #bitcoin-otc. Even if there's no one from New Zealand there, there must be someone interested in diversifying their cash holdings.

I'm keeping a USD balance on Mt Gox. When I want something I can get for bitcoins, I buy more bitcoins to cover the cost.

I accessed my Instawallet through Tor today, then realized that's probably a bad idea in general. Maybe I should create a new one?

I am no longer selling bitcoins at any price below 50 USD per.