Can anyone speak to this video? Critical of Bitcoin

[Boussac]

So there is a real scalability problem?

Yes there is a real scalability problem if all users are full clients.  No, that was never the intention.  We are already way past the point (imho) that we need more full clients.  We need more light clients and overlay networks to support them, such as BitcoinSpinner, Electrum & Stratum.

Yes, our overlay network (paytunia) is unfolding nicely and no we are not "morphing" (sorry Mr Kaminski) into anything resembling a traditional bank..

[muyuu]

Is this guy drunk or does he speak and act like this usually?

[apetersson]

i think he is just trying to wake people up with some controversial quotes.

right at the start "there are only 5 people in the room who understand why [multicast issues on the internet] this so true"

when cleaning up some scarcasm from his text he says:
bitcoin is the best value transaction system in the world
the code seems extemely secure he could not point to any exploit

there are exactly 2 issues he is worried about:
1) scalability because it keeps all transaction history
2) bitcoin is not anonymous

so to counter this criticism:

1) the community is very aware of scalability and is developing fixes for it.
2) this is intentional

interestingly he claimed a bitcoin thief published a donation address somewhere with a different ID. what is the story here?

[bitlizard]

Thanks and I like your hat.

[mystery2048]

This guy is actually very good at explaining how bitcoin works... Someone should hire him as a PR guy...

Also, unlike many critics, at least hes analyzed it in depth and looked at the source... I agree with many things he says...

[bitlizard]

Here is an off topic question/issue for any of the smart people viewing the thread who might be able to help. I started posting on the Joe Rogan Pocast Forums after Adam Kokesh was a guest on his show. Someone inferred that Adam was not too bright as he is a bitcoin advocate and bitcoin is of course a useless digital pump and dump currency for free market dummies like ourselves. I asked him how he arrived at that conclusion and he responded with the following:

"It's extremely volatile when it comes to day-to-day commerce using BitCoins. Valuation judged by conversion rates can (and have) swing rapidly one day to the next. One day you're e-wallet is worth $1000 worth of BitCoins and the next it could be worth $500. There's no confidence indicator for anyone to engage in commercial activity. This is why at the moment, the distribution of BitCoin mining comes from power users hoarding BitCoins, producing merely to produce BitCoins and pump and steady it's value.

All BitCoin has going for it is the algorithmic block that gives it scarcity, and the anonymity for transactions. However, both are highly contested by computer scientists who find more exploits and vulnerabilities with BitCoin everyday.

One could say crypto-currencies are in a very nascent stage but without regulation, all it takes is the collusion of large BitCoin holders/miners to process and transact securitized agreed-upon nodes and then reject others, and then BitCoin will to go the way of company scrip."

Now I could quickly respond by pointing out some of the more obvious factual errors in his response. But seeing as how there have been over 35,000 views on the particular thread I thought it might be worth taking a little more time and enlisting the help of the bitcoin community to dispel his nonsense in a clear and powerful way. suggestions?

here is a link I dont think that you can view without being registered though. http://forums.joerogan.net/showthread.php?t=239888&page=81

[austonst]

Well, I guess if we're going to organize a response, we should think of the best way to respond to each point.

Volatility: This one is an issue, but one that I believe will work itself out over time. Maybe some references to bitcoincharts over the past 6 months would provide hard data. Maybe someone else has a better idea here, because the volatility is probably keeping businesses away. Oh, how about Bit-Pay? It provides quick conversion straight to USD so that volatility doesn't matter and merchants can accept BTC without risk.

Vulnerabilities: Open source. According to https://en.bitcoin.it/wiki/Common_Vulnerabilities_and_Exposures , the last real exploit was in August 2010, and that was handled with a blockchain fork. Since then, we've been doing great. Client devs are doing a good job of patching up issues before they become a threat. Emphasize that the protocol itself has had no issues; all problems are with bugs in client code.

51% Attack: There was a recent thread where plenty of people explained why a 51% attack would not have much of an effect. It might be worth tracking it down. Maybe find some quotes from large pool operators where they explain that they're not going to collaborate on an attack? Maybe bring up p2pool as a helpful solution.

Any other ideas?

[Piper67]

As far as I'm concerned, Bitpay has dealt with the issue of volatility fully. You can get paid in bitcoins and the payment is converted instantly into fiat and deposited in your account. This means you either:

a) Don't care about volatility because you "think" in bitcoins and you're getting paid in bitcoins, or

b) Don't care about volatility because you "think" in fiat, and you're getting paid in fiat, and Bitcoin is just a fast, uncounterfeitable payment processor without the risk of chargebacks.

Either way, you win.

Incidentally, another way of looking at volatility is that, in the absence of hacks, the volatility has typically been upward when measured over periods longer than a few days. That's the kind of volatility a business owner can live with