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Author Topic: Anonymity is bitcoin's weakness  (Read 1744 times)
BTCrow
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June 20, 2011, 10:44:35 PM
 #21

The problem is how do you get bitcoins back if they are stolen?  With money, you can go to the authorities and have some chance.  Bitcoin is just going to attract criminals and they'll just swap in for cash. 

I don't think criminal will swap it for cash in near future, since more and more merchant now offer services and others good with bitcoins, criminal will only do money laundering to cash it out.

I tought about a protection mechanism to prevent this, such as reversal but without reversal, and I didn't find anything working. If we ask exchangers to track orders and don,t process bitcoins stolen, how do you prove that this is a real steal? So for getting criminal out of our wallet, we need to have something such banks have. A "strong" protection at the start.


I work as a computer security consultant and I can really say this: people don't know how to secure their things and even if they know they just don't want or are too lazy (for the majority) to do it. So I think that the current software (bitcoin client / bitcoind) must include protection for wallet.dat in order to prevent malicious people to just steal it and get your money.

just my 0.02 BTC.

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BTC Economist
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June 20, 2011, 10:49:45 PM
 #22

The problem is how do you get bitcoins back if they are stolen?  With money, you can go to the authorities and have some chance.  Bitcoin is just going to attract criminals and they'll just swap in for cash. 

I don't think criminal will swap it for cash in near future, since more and more merchant now offer services and others good with bitcoins, criminal will only do money laundering to cash it out.

I tought about a protection mechanism to prevent this, such as reversal but without reversal, and I didn't find anything working. If we ask exchangers to track orders and don,t process bitcoins stolen, how do you prove that this is a real steal? So for getting criminal out of our wallet, we need to have something such banks have. A "strong" protection at the start.


I work as a computer security consultant and I can really say this: people don't know how to secure their things and even if they know they just don't want or are too lazy (for the majority) to do it. So I think that the current software (bitcoin client / bitcoind) must include protection for wallet.dat in order to prevent malicious people to just steal it and get your money.

just my 0.02 BTC.

I was wondering if there was a way to require wallet be stored on an external drive?   Would get people to treat it more like a credit card and keep it off networks when it wasn't in use...

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June 20, 2011, 10:57:30 PM
 #23

I was wondering if there was a way to require wallet be stored on an external drive?   Would get people to treat it more like a credit card and keep it off networks when it wasn't in use...

I think we need something less complex for the average users, this is one problem about security in general, more you put security measures in place more you'll loose users because they don't want to use it. Do somethign completely transparent without asking effort to users and you,ll find a good solution for this. I you find it, let me know lol I'm still searching.

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June 20, 2011, 11:03:33 PM
 #24

I keep seeing all this criticism of bitcoin that is basically "hackers can steal your money".  It's amazing how no one seems to remember all of the hacks of major financial institutions during the last 12 months that were much worse for the individual customers.

Citibank had 200,000 customer names, account numbers, and email addresses stolen.  Google, Apple, Lockheed Martin, etc. all had break-ins that resulted in more sensitive information being stolen than hashed passwords and email addresses.

The fall-out is what is VERY different when you compare btc-related break-ins and the major $ businesses.  Citibank says "too bad" and since you can't avoid doing business with them and they know it, they can do what they want.  A btc exchange operator knows there are no barriers to entry in his industry so he has to win you back or go out of business.  That is one of the primary reasons bitcoin was created.

The problem is how do you get bitcoins back if they are stolen?  With money, you can go to the authorities and have some chance.  Bitcoin is just going to attract criminals and they'll just swap in for cash. 

If it's not anonymous as a lot of people here are claiming, then why hasn't somebody tracked down the thief and got the money back.  It isn't going to happen.

In the long run, this will be btc's downfall.  People won't trust it.

Your nick is too big for you, clearly you have no clue.
As I said, bitcoin transactions are transparent, there are public records accessible by anyone.
The only peculiarity is that your identitiy is still unknown.

If you start a big illegal operation based on bitcoins, you will leave red trails over the whole network. The whole network will have logs of your illegal operation.
As soon as the bitcoin touches the real world (ip addresses, delivery addresses, purchases, email addresses, bank deposits, conversion... etc) your anonymity is prone to be compromised.

Small illegal transactions might get undetected under the radar, big illegal operations are vulnerable to statistical analysis.
SlickShaman
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June 21, 2011, 02:30:18 AM
 #25

We all want anonymity but we also know that bitcoin transactions aren't entirely anonymous.
Bullethead21
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June 21, 2011, 11:00:26 AM
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I think you guys are way ahead of yourselves .....what needs to happen first is real documentation and and a software developer to adopt the backend software like pushpoold for starters......its never going anywhere with only people who are lucky enough to get it working properly....it should not require "luck" to get it running and set up correctly.....the way it stands now makes it looks like a "back yard project" at best....as someone mentioned earlier, nobody is going to trust that......

btcsquirrel
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June 21, 2011, 09:54:35 PM
 #27

I think you guys are way ahead of yourselves .....what needs to happen first is real documentation and and a software developer to adopt the backend software like pushpoold for starters......its never going anywhere with only people who are lucky enough to get it working properly....it should not require "luck" to get it running and set up correctly.....the way it stands now makes it looks like a "back yard project" at best....as someone mentioned earlier, nobody is going to trust that......

This is correct.  I'm sure we've all had the experience of explaining bitcoin to someone ... and anything that takes 15 minutes of Q&A is not going to be used by most people.

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