Why do people trust Casascius so much?

[SgtSpike]

This isn't meant to be a dig against Casascius, because he has shown himself to be an upstanding citizen thus far, but I am just curious why everyone so readily trusts him with long-term storage of their BTC?  Supposedly, he doesn't keep the private keys for items he has fulfilled, but you can't know that for certain either.

He currently holds over $500,000 worth of BTC that, if he had been keeping the private keys, he could simply take and run.
http://casascius.uberbills.com/

The reason I am asking this is because I am considering purchasing some coins for gifts this Christmas, but something just feels wrong about giving trust of holding my Bitcoins (or those of the people who trust me) long term to a 3rd person entity.

So, why do YOU trust Casascius?

[acoindr]

Q. It's impossible to prove you didn't keep the private keys, and with all the Bitcoin scams lately, why should I believe you?

A.  I have given out my real-world identity and have digitally signed a list of the Bitcoin addresses used in this project.  I have made it so that it if I were to perpetrate a scam, it would be possible to prove it and to hold me legally accountable - something no scammer wants to do.  You should demand the same from anyone handling your cryptocurrency.

https://www.casascius.com/faq.aspx

[justusranvier]

There's probably a way to use multisig to completely eliminate the risk.

[kiba]

The better solution is for Casascius to figure out a solution that doesn't involve trusting him. Or you guys could suggests a solution that Casascius can implement.

[Severian]

Because he uses his real name and makes himself accountable, as any responsible businessperson does.

[greyhawk]

Have you seen the guy? He wouldn't hurt a housefly.

http://www.youtube.com/watch?v=H9jC0TP-Yug

He just looks so cuddly. 

[FreeMoney]

Q. It's impossible to prove you didn't keep the private keys, and with all the Bitcoin scams lately, why should I believe you?

A.  I have given out my real-world identity and have digitally signed a list of the Bitcoin addresses used in this project.  I have made it so that it if I were to perpetrate a scam, it would be possible to prove it and to hold me legally accountable - something no scammer wants to do.  You should demand the same from anyone handling your cryptocurrency.

https://www.casascius.com/faq.aspx

That's nice, but what if his wife gets rare expensive cancer. Also he could set it up to give the keys to his illegitimate son or mistress none of us know about on his death.

I guess we just trust that since he didn't plan any of that (esp cancer) he doesn't even have the keys.

I don't think it is a high % risk, but it could end up being billions of dollars worth, so a better solution would be good.

[BitPay Business Solutions]

http://www.youtube.com/watch?v=H9jC0TP-Yug

"That's 8 bucks, or about 3/4 of a bitcoin".  -PLATO, June 2011

my, you'd think the price hasn't moved at all

[allthingsluxury]

He has proven his self so far. We have to have some trust to make this system work. He gives out his real name and has it set up so you could go after him fairly easily. I think there is not much else he can offer. Guess you just need to make a judgement call if you feel comfortable or not at this point.

[kokojie]

what is casascius's real world identity? I seems to have missed it.

[caveden]

There's probably a way to use multisig to completely eliminate the risk.

How?

If you keep the requirement of coins being spendable by anyone in physical possession of them (just like cash), how can you use multi-sig to avoid having to trust the issuer?

[caveden]

So, why do YOU trust Casascius?

I don't really need to, as the amount I hold in his coins is something I can afford to lose.

I wouldn't advice holding huge amounts in physical wallets created and funded by a third-party. If you really want a physical wallet of some kind with a large amount, just create your own paper-wallet.

[justusranvier]

If you keep the requirement of coins being spendable by anyone in physical possession of them (just like cash), how can you use multi-sig to avoid having to trust the issuer?

I guess the first purchaser could avoid needing to trust Casascius but it wouldn't work if they ever want to give the coins away.

[casascius]

I would certainly be a fan of multi-sig pieces and have thrown out the idea here in the past.

I am appreciative of the trust the community has extended to me and while I agree it's likely well-deserved, I am also sympathetic to the notion that we should demand solutions that require as close to zero trust as possible.

I've mentioned this in posts before but will summarize since it's relevant to the topic:  I could quite easily produce a double-sided physical bitcoin that accepts two holograms and two private keys, one on each side.  I would fill in one side, and somebody else would fill in another with a private key of their own making.  The main issue has chiefly been supply and demand at the price it would cost: if it only makes sense for me to make coins with a markup of a couple of bucks, it would cost that much more if the material and labor cost roughly doubled.  Most potential customers indicated that it wouldn't make sense to pay double the premium on a 1BTC just to have it marginally more secure (though that was at a day and age where the premium on the coin was much larger relative to the then-current value of 1 BTC).

On top of that, at least so far, nobody else on the forums has been willing to invest the resources and effort to produce physical bitcoins, even if I offered to give away part of my own solution (e.g. token blanks, or the private key generator, etc.).  Although I would effectively be creating my own competition, my end goal is to promote Bitcoin, having competition is compatible with that, and having another credible physical bitcoin provider would enable cooperative opportunities for creating these very same multi-sig or multi-part keys that some seek, especially for the larger denominations, or as an off-the-shelf secure wallet solution.

On the other hand, one must consider that a two-part key is still only marginally more secure than a one-part key, as the two parties could plausibly conspire to commit fraud (and, blaming two parties pointing fingers at one another is a fair bit harder than blaming one and only one party who is clearly identifiable).  In spite of not being perfect, if adding a second keypart could be viewed as simply a way to lessen the possibility that fraud will occur, then giving out my name and address is also a measure to do the same thing, just at a lower cost.

The "what if my wife gets rare cancer" (or any similar situation where the cost of being clearly guilty of fraud starts to seem acceptable) is clearly a legitimate concern.  Without being too specific, my personal financial standing has been such (since long before encountering Bitcoin) where I have many other well-above-average options for managing risk and crises without having to resort to engaging in fraud as a last ditch effort.  I am sure there are enough people here who know me IRL who could confirm that to be likely true, and I would cooperate with any efforts to verify any claims I've made.

I'd likewise cooperate with anyone who desired to own any of my high-denomination pieces where they generated half the key (for example, a two-part 1000 BTC gold coin).  Such a coin is possible even without multisig, and the methodology for producing it has been discussed in other threads.  The piece would need the second private key to be redeemable and a small utility program to combine the keys into a single key, and I'd laser-engrave the piece to indicate as such.  So far nobody's taken me up on this, but it's out there.

[bitlane]

Frankly, I am currently in love with Mike for one reason and one reason only......and anyone who doesn't currently have me on 'ignore' can guess why that is with little effort.

Thanks again Mike, for being a standup guy in a shit-encrusted/scam-filled world.

[greyhawk]

You should update your avatar accordingly. 

[giszmo]

On the other hand, one must consider that a two-part key is still only marginally more secure than a one-part key, as the two parties could plausibly conspire to commit fraud (and, blaming two parties pointing fingers at one another is a fair bit harder than blaming one and only one party who is clearly identifiable).

Well, with the thief needing both addresses, it would require both to be corrupt and even if both conspired during production, I am sure they would not share their keys with each other prior to running with the money as that would put them to the risk of not being out of the country when the "partner" moves the money.

Q. It's impossible to prove you didn't keep the private keys, and with all the Bitcoin scams lately, why should I believe you?

A.  I have given out my real-world identity and have digitally signed a list of the Bitcoin addresses used in this project.  I have made it so that it if I were to perpetrate a scam, it would be possible to prove it and to hold me legally accountable - something no scammer wants to do.  You should demand the same from anyone handling your cryptocurrency.

https://www.casascius.com/faq.aspx

That's nice, but what if his wife gets rare expensive cancer. Also he could set it up to give the keys to his illegitimate son or mistress none of us know about on his death.

… exactly this is what gets me most concerned. I bought one of his coins for my brother but I know he's smart enough to scratch it open before BTC goes x1000.

We have to have some trust to make this system work.

Nope. The Bitcoin works exactly without trust in any single person. That's what makes it so beautiful. Hosted wallets and physical coins are a step backwards.

As always I feel bad for pulling down a great initiative that most likely was done in best intentions but in a system where you don't need trust, adding services that need trust is something nice but unnecessary.

[Elwar]

what is casascius's real world identity? I seems to have missed it.

His name is Casascius. He lives on the high seas.

[Syke]

what is casascius's real world identity? I seems to have missed it.

His website is pretty clear on that: https://www.casascius.com/

It seems to me he's taken enough precautions to minimize risk, probably even more precautions than I would do myself, so I feel pretty confident my measly 2x 10btc coins are safe.

[casascius]

… exactly this is what gets me most concerned. I bought one of his coins for my brother but I know he's smart enough to scratch it open before BTC goes x1000.

There is a reasonable likelihood that, as BTC price rises, that that risk could be made insurable.  As the value of BTC rises, the business case for someone to come along and pledge for a fee to make you whole if I scam you becomes more and more sensible.  That person or business entity may be in a position to satisfy themselves that such a loss will either be impossible or recoupable, and make a profit on that position.  If BTC rises x1000, those coins are going to be worth a hell of a lot more than 1BTC intact.

Nope. The Bitcoin works exactly without trust in any single person. That's what makes it so beautiful. Hosted wallets and physical coins are a step backwards.

As always I feel bad for pulling down a great initiative that most likely was done in best intentions but in a system where you don't need trust, adding services that need trust is something nice but unnecessary.

The more Bitcoin grows, the more there will be a need for trust in bank-like payment processing clearinghouses.  It's not sustainable to have every node in the world receive, process, and relay a kilobyte packet everytime anyone anywhere opens a sodapop or buys a pack of gum or parks in a metered stall, so ultimately some trusting somebody is going to be required.  Each time you walk down the street, you must trust that each person driving in the opposite direction isn't going to hit and kill you.  Trust isn't purely an altrustic phenomenon - having recourse and accountability goes a long way - you can generally trust that rational people won't take actions whose consequences are severe and contrary to their own best interests, and much of the world functions with that in mind.