EFF donations and the Bitcoin Faucet

[Litt]

I don't know how effective the faucet is now due to abuse, but personally it was my very first bitcoin transaction that I received. It clearly demonstrated how Bitcoin worked for me real time and help me take a step closer to using Bitcoin personally. I say Faucet would be one cause that we can all agree on as a community which is to promote for the success of Bitcoin.

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[teukon]

I don't know how effective the faucet is now due to abuse, but personally it was my very first bitcoin transaction that I received. It clearly demonstrated how Bitcoin worked for me real time and help me take a step closer to using Bitcoin personally. I say Faucet would be one cause that we can all agree on as a community which is to promote for the success of Bitcoin.

Personally I'm a fan of the faucet.  I got my first 5 BTC there.  I've since donated 10 BTC back and am impressed with how it's come along.  However we're talking about the bitcoins which people have donated to the EFF, not to the faucet (or even to the success of Bitcoin).  Diverting the funds to a pro-bitcoin project on the whim of a few forum posts is irresponsible.

If the EFF specifically want to support Bitcoin and specifically by funding the faucet then fine, they may spend their coins as they see fit, but I think they could have put those funds to far better use.  As I said before, fiat donors of the EFF would probably be upset to see the EFF simply funnel all their funds into the faucet.  If my donations will be treated with more respect if I donate in fiat then I will avoid using Bitcoin for donations from here on.

[Rob P.]

However we're talking about the bitcoins which people have donated to the EFF, not to the faucet (or even to the success of Bitcoin).  Diverting the funds to a pro-bitcoin project on the whim of a few forum posts is irresponsible.

If the EFF specifically want to support Bitcoin and specifically by funding the faucet then fine, they may spend their coins as they see fit, but I think they could have put those funds to far better use.  As I said before, fiat donors of the EFF would probably be upset to see the EFF simply funnel all their funds into the faucet.  If my donations will be treated with more respect if I donate in fiat then I will avoid using Bitcoin for donations from here on.

Gavin was contacted by the EFF, not the other way around (see OP).
Gavin asked this forum for ideas on what he should do (he didn't say he was going to do them, he's taking a temperature)
The EFF was clear that they will NOT be converting the funds to cash, and that they see no way to return the funds legitimately, hence they reached out to Gavin to ask for ideas of what to do with them.

Based on all of the above, it would seem that they should do:
a)  Donate them to the developers to assist with costs on improving the client, protocol, and security issues (if any) around Bitcoin.
b)  Donate them to the "Community" via the Faucet.
c)  Fund pro-Bitcoin projects, in Bitcoins.  These could be bounties for bugs, funds for new projects, attorney fees (paid in BTC), etc.

We're just providing ideas, ultimately it's Gavin who will make suggestions back to the EFF.

Also, wouldn't it provide much more impact for the Bitcoin community if the EFF did C above?  Showing that this currency can get real-world issues solved and people will do real work for them.  I would think that just having the EFF convert them to cash and then spend the cash would be kind of a failure on the part of the community.  That means Bitcoins are just a commodity, not a currency, to be speculated with. 

Use them directly, buy things with them, pay for labor with them, but definitely don't just hold them.

[Michael]

It's a shame, though I certainly understand the reasons behind their actions. (Basically, they aren't sure of the legal implications, and don't want to be a test case, and they also don't want to be seen as endorsing bitcoins.)

However, I would rather see most of the coins go to another organisation, such as the FSF or Freenet. I donated (either 10 or 15 bitcoin, back when they weren't worth as much) specifically to help fight for Internet freedom. While I like the idea of some of they money going to the Faucet, I don't see the need for all of it going there. After all, the Faucet can run off a trickle.

Hopefully they think about their decision a bit more before they go through with it.

[Klestin]

There is a way to do a refund.  It's a bit manual, but:

- Each person desiring a refund sends an email to the EFF with a tiny, random, specific amount specified (e.g. .00176132), along with an address to use for the refund.
- The person then sends this amount to the donation address.  
- Block explorer can find the specific donation, and show the full amount sent from the donator to the EFF.
- Refund is made.

*Disclaimer: Based on my somewhat limited understanding*

[sortedmush]

Electronic what foundation?

[teukon]

However we're talking about the bitcoins which people have donated to the EFF, not to the faucet (or even to the success of Bitcoin).  Diverting the funds to a pro-bitcoin project on the whim of a few forum posts is irresponsible.

If the EFF specifically want to support Bitcoin and specifically by funding the faucet then fine, they may spend their coins as they see fit, but I think they could have put those funds to far better use.  As I said before, fiat donors of the EFF would probably be upset to see the EFF simply funnel all their funds into the faucet.  If my donations will be treated with more respect if I donate in fiat then I will avoid using Bitcoin for donations from here on.

Gavin was contacted by the EFF, not the other way around (see OP).
Gavin asked this forum for ideas on what he should do (he didn't say he was going to do them, he's taking a temperature)
The EFF was clear that they will NOT be converting the funds to cash, and that they see no way to return the funds legitimately, hence they reached out to Gavin to ask for ideas of what to do with them.

Based on all of the above, it would seem that they should do:
a)  Donate them to the developers to assist with costs on improving the client, protocol, and security issues (if any) around Bitcoin.
b)  Donate them to the "Community" via the Faucet.
c)  Fund pro-Bitcoin projects, in Bitcoins.  These could be bounties for bugs, funds for new projects, attorney fees (paid in BTC), etc.

We're just providing ideas, ultimately it's Gavin who will make suggestions back to the EFF.

Also, wouldn't it provide much more impact for the Bitcoin community if the EFF did C above?  Showing that this currency can get real-world issues solved and people will do real work for them.  I would think that just having the EFF convert them to cash and then spend the cash would be kind of a failure on the part of the community.  That means Bitcoins are just a commodity, not a currency, to be speculated with. 

Use them directly, buy things with them, pay for labor with them, but definitely don't just hold them.

I see where you're coming from and I'm aware that the EFF contacted Gavin, not the other way around.  I'm guessing that by declaring that they will not be converting the funds to cash that they are also opposed to having a third party convert the funds to cash and then donate the cash to them (legal mess).

What I'm not clear on is wether the EFF aim to support Bitcoin directly or simply seek advice from Gavin.  If the former is the case I have no problem, the EFF have received funds and now they want to put them to use supporting a new cryptographic currency - fair play.  In the latter case it would be good to see some non-Bitcoin suggestions too.  For example, the EFF could donate the total to torservers.net (they seem to be more closely associated with torservers than with bitcoin so they may feel more comfortable with this).

[teukon]

It's a shame, though I certainly understand the reasons behind their actions. (Basically, they aren't sure of the legal implications, and don't want to be a test case, and they also don't want to be seen as endorsing bitcoins.)

However, I would rather see most of the coins go to another organisation, such as the FSF or Freenet. I donated (either 10 or 15 bitcoin, back when they weren't worth as much) specifically to help fight for Internet freedom. While I like the idea of some of they money going to the Faucet, I don't see the need for all of it going there. After all, the Faucet can run off a trickle.

Hopefully they think about their decision a bit more before they go through with it.

Sorry, I started composing my post shortly after you posted.  I didn't know FSF accepted Bitcoin, thanks for this.

Yes, along with the best pro-Bitcoin suggestions I think these possibilities should be mentioned.  I'm hopeful that the EFF will find a good balance if they are given enough options.

[realnowhereman]

No need for corporations; Bitcoin doesn't have to work like that.

Make a "trust fund" account on ClearCoin, with some trustees.  That trust will be held for (officially) "the good of the community"; but unofficially "for the day when EFF accepts Bitcoins".

I understand why the EFF don't want them now.  They're going to be the place we go to when the shit hits the fan.  When the government come for you, the EFF will be the ones who turn up to save you.  They can see that's what's going to happen, and so are making sure they don't have a vested interest in seeing Bitcoins declared legal.

However, that doesn't stop the community from saying: "fine, we'll keep them".  Just as there would be nothing stopping each of the original donors from keeping all returned coins to one side for exactly the same purpose.

[Herodes]

I'll need to do a little bit of thinking about how to handle the EFF coins safely (just dumping them all into the Faucet's wallet is not a good idea; I would hate for them to get lost if somebody managed to hack the Faucet's web-facing code). Whatever I do, I will make sure the process of moving the coins from the EFF's donation address to the Faucet is absolutely transparent.

I think it would be better if the funds in question could be given to one or more developers to do the following:

1. Make better client software, ie. secure it better with default encryption.

There are probably other things as well, we could need a distributed exchenge. Do not know how that should be done, but there are many things these money could be used for.

[Nescio]

Why not give them to Bruce Wagner's "bitcoin firehydrant"? At least we'd get a nice publicity event that might be pro bitcoin for a change when a million people queue up for free bitcoins in NYC.

I think a lot of people who donated to a non-profit will object to the difference with what Bruce is doing. Holding on to the coins until the EFF comes off the fence would be best I think.

Very high level of signal to noise ratio in this thread, lots of thoughtful posts, how refreshing

[teukon]

Why not give them to Bruce Wagner's "bitcoin firehydrant"? At least we'd get a nice publicity event that might be pro bitcoin for a change when a million people queue up for free bitcoins in NYC.

I think a lot of people who donated to a non-profit will object to the difference with what Bruce is doing. Holding on to the coins until the EFF comes off the fence would be best I think.

In the future it is likely there will be significant legal contention concerning Bitcoin.  At this point the EFF is one of the first organisations which comes to mind which might choose to defend Bitcoin.  Their position would be weakened if they held a large sum of Bitcoins themselves.

Very high level of signal to noise ratio in this thread, lots of thoughtful posts, how refreshing

Yes, how odd.  I didn't like the trolls but now that they're absent I find myself missing them.

[Astrohacker]

They should just shred the wallet file. That would be equivalent to giving a little donation to every other bitcoin user in proportion to how many bitcoins they have.

[Michael]

But hardly actually does anything constructive, like build the economy, or encourage people to use bitcoins. I think I much prefer the idea of just giving them to Gavin and the other developers to do with as they please, rather than that.

[gusti]

I'd just lost all my respect for EFF.

[blendergasket]

Why not give them to Bruce Wagner's "bitcoin firehydrant"? At least we'd get a nice publicity event that might be pro bitcoin for a change when a million people queue up for free bitcoins in NYC.

I think a lot of people who donated to a non-profit will object to the difference with what Bruce is doing. Holding on to the coins until the EFF comes off the fence would be best I think.

In the future it is likely there will be significant legal contention concerning Bitcoin.  At this point the EFF is one of the first organisations which comes to mind which might choose to defend Bitcoin.  Their position would be weakened if they held a large sum of Bitcoins themselves.

Very high level of signal to noise ratio in this thread, lots of thoughtful posts, how refreshing

Yes, how odd.  I didn't like the trolls but now that they're absent I find myself missing them.

Exactly. Also, how would defending the existence/legality of a currency they've received a large number of donations in effect their nonprofit status? I honestly don't know but I could see how accepting this could be perceived as a big conflict of interest and weaken their ability to help Bitcoin in its inevitable hour of legal need. Any sort of donating the Bitcoins to something EFF believes in/backs/is ideologically related to could be perceived as the same thing as them accepting the Bitcoins I'd assume so they really need to either return them, which seems difficult, or let them trickle back into the network in such a way that doesn't benefit them or anything that's perceived to be related to them.

So I think the EFF's totally right in doing this. However they probably should've thought of this before they decided to accept Bitcoin donations in the first place.

[wareen]

So I think the EFF's totally right in doing this. However they probably should've thought of this before they decided to accept Bitcoin donations in the first place.

From their announcement:

We helped inform our members about this unique project through our blog and we experimented with accepting Bitcoin donations for several months in an account that was started by others.

It seems it wasn't their own idea in the first place.

Returning all of the donations is clearly impossible - some of the original private keys might be deleted or in the wrong hands by now.

While the faucet was great back then, I agree that the risk of abuse is too high, especially if it were known that a large amount went into its funding.

I personally like the idea of a trust fund for Bitcoin held by some of the developers / elders with the purpose of legal defense for Bitcoin. We could probably work out some kind of trust instrument which ensures it would only be used for purposes in the spirit of the EFF's work. It may well be that the EFF qualifies for the money some day but it shall not be held explicitly for them (due to the reasons mentioned).

Of course, Gavin would have to take the trouble to set this up but I think such a fund might come in very handy for the Bitcoin community and would probably be the closest thing to the original intentions of the donors.

I'm sure such a fund held by reputable members would receive even further donations!

[gsan]

So I think the EFF's totally right in doing this. However they probably should've thought of this before they decided to accept Bitcoin donations in the first place.

From their announcement:

We helped inform our members about this unique project through our blog and we experimented with accepting Bitcoin donations for several months in an account that was started by others.

It seems it wasn't their own idea in the first place.

Well, since they have legal concerns, it's very convenient to state something like this, so that they can say it's unrelated to the organization if shit hits the fan.

I think they just realized that the enemies they can make with Bitcoin are much more serious than the ones they make with Bittorrent, TOR, etc. Besides, people are like abused children when it comes to core issues like money, there is a lot of people who are willing to act against Bitcoin out of their good will. It's hard to assume that the average EFF supporter likes the idea of Bitcoin.

[phelix]

did I miss something or is it still not known how much it is? Transparency rulez!

[teukon]

did I miss something or is it still not known how much it is? Transparency rulez!

I dug out the address I originally donated to and whacked it into blockexplorer.com
http://blockexplorer.com/address/1MCwBbhNGp5hRm5rC1Aims2YFRe2SXPYKt
This address has received about 3500 BTC in total.

I'd imagine this is everything but there could be other donation addresses out there too.