Trust No One

[Ridi]

Thank you Kilgore!

[guci22]

Thank you so much for saying this!

[nomadwfs]

I don't get it. How can people be so trusting with bitcoins?

Treat BTC like you would real money. Hell, you probably bought them with real money anyway; if you didn't, you mined them with computer equipment you paid real money for. You wouldn't play fast and loose with your bank account balance or credit cards, would you?

Then again, people would, and people do. A fool and his money are soon parted, and that applies to ALL stores of value. Just because it's digital doesn't mean someone doesn't want to steal it.

[Ten98]

I don't get it. How can people be so trusting with bitcoins?

Treat BTC like you would real money. Hell, you probably bought them with real money anyway; if you didn't, you mined them with computer equipment you paid real money for. You wouldn't play fast and loose with your bank account balance or credit cards, would you?

I get you, but if anything, my bitcoins are far far more secure than my real money is.

My real money sits in a brown piece of leather in my pocket, or more often than not just lying on a table somewhere. Anyone could take it and run off with it and I'd have no hope of getting it back.

The money in my bank is somewhat more secure, although it doesn't take a genius to watch me type in my PIN and steal my ATM card.

I guess I'm a little fast and loose with my coins, storing them here there and everywhere across maybe a dozen or so exchange websites rather than on my own wallet, but I don't really have that many at the moment, probably less than 30 coins all told.

If I were to rack up several hundred I'd probably make a handful of encrypted wallet.dat files and back them up a few times like the OP says. I'm not sure about mailing copies here there and everywhere, that seems a little over the top. It would certainly suck to forget the password to them though!

[typhoon]

People need to be more aware of IT security in general, not just with bitcoins.

[Satama]

From systemic point of view, this advice is pure lunacy. Bitcoin, just like fiat currencies that it may replace totally, are purely symbolic numbers that don't have any intrinsic value. The only value of a bitcoin is the commonly shared confidence in the bitcoin community. Have confidence! 

[leeloulee]

I trust no one but the people I trust,,,,

[Crypt_Current]

The fact that one cannot trust anyone else with holding their bitcoins (at least, in my mind, to the extent that anyone would entrust another individual to hold his/her cash) is used all the time by the opposition to BTC.

This (like most [if not all] arguments against BTC) posed by the haters is used as supposed ammunition to the detriment of BTC's legitimacy.

This is incorrect logic; it is a fallacy, and this is why:  The very fact that one cannot trust another to hold his/her BTC, proves that BTC has at least the same demand among those who would use it for goods / services as does cash.

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[Crypt_Current]

My real money sits in a brown piece of leather in my pocket, or more often than not just lying on a table somewhere. Anyone could take it and run off with it and I'd have no hope of getting it back.

Not quite -- Police take reports of lost cash seriously.  Police do not take reports of lost BTC seriously.

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[Crypt_Current]

Bitcoin, just like fiat currencies that it may replace totally, are purely symbolic numbers that don't have any intrinsic value. The only value of a bitcoin is the commonly shared confidence in the bitcoin community.

This is a common misconception of Bitcoin.  Bitcoin is based on value (rather than based on debt, like our present [and arguably, any conceivable] fiat currencies).  The exact intrinsic value that Bitcoin has is the value represented by the proof-of-work algorithm that is solved when nodes on the network process transactions.  Without this intrinsic value of Bitcoin, no extrinsic value (such as the ability to trade it for goods / services) would be possible.

One argument often employed by the haters of Bitcoin is that it is virtual and therefore not tangible, but this is wrong because the tangibility of something has nothing to do with whether that thing is physical or not.  Tangibility requires the object in question to have the ability to be treated as fact, and the intrinsic value of Bitcoin is a (hard coded) fact.  Alternatively, there is literally no tangibility in fiat currencies (such as dollars or euros) because the only "fact" giving them any "intrinsic value" is that some individual or group of individuals deemed or decreed it so.

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[fatbitcoinfan]

I definitely agree that trusting people is to be avoided. The whole concept of bitcoin was to replace trust with cryptographic proof.

Now there are other difficulties with trust. The most obvious is: How can you trust that somebody will send you what you asked for when you pay them in bitcoins?

There are escrow services, but then you're trusting the person running the escrow service. Sure, it might have been running for a long time with no complaints, but it's an important point of principle that you shouldn't need to trust anybody at all.

How could that requirement to trust be removed?

I think it might be possible with something like a peer-to-peer automated escrow service. If you can't trust anybody, then you can't have human judgement involved, so it has to be fully automated. If you can't trust anybody to set up an automated service and not build in a backdoor for themselves, then it has to be open-source and peer-to-peer.

[Crypt_Current]

Now there are other difficulties with trust. The most obvious is: How can you trust that somebody will send you what you asked for when you pay them in bitcoins?

There are escrow services, but then you're trusting the person running the escrow service. Sure, it might have been running for a long time with no complaints, but it's an important point of principle that you shouldn't need to trust anybody at all.

How could that requirement to trust be removed?

I understand this concern, which is the original topic of this thread, but I also feel that it is just slightly over-the-top with paranoia.

To me, the whole Bitcoin situation is analogous to the Gold Rush in the 1800s and the subsequent settling down on a standardized form of cash that represented gold's value.  There were certainly a lot of robberies back then, and people who had trust placed in them who turned the other way because the temptation of greed was overpowering.

The Bitcoin system itself seems to do extremely well to prevent hacks from injecting malicious transactions.  The real trust issue is when an individual stores the Bitcoins or trades them for goods and services.  Personally, I am just entering into the BTC world so trust is not an issue for me -- yet.

Perhaps you are onto something with your idea of a P2P escrow service, though.

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[Xephan]

If you like my posts, consider donating:
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You could just put that into your sig instead of pasting it with every post...

Now, if you like that tip, consider donating:

[Crypt_Current]

You could just put that into your sig instead of pasting it with every post...

Now, if you like that tip, consider donating:

ha, thanks for the tip.  I discovered my ability to create a signature after the fact -- apologies for the double-asking.

I'll certainly tip you though -- when I actually get some BTC ;-)

[Crypt_Current]

BTW, can you tell it's been forever since I actually became involved with a discussion forum?  :-D  Been a looooong time and looooong journey...

[DownloadCoin.com]

The best solution is to simply hold on to your Bitcoins yourself. The only problem with that is that you can't access the wallet easily from multiple devices/locations.

[ngzhang]

I usually trust somebody first, until this guy betraied me.

[Ten98]

My real money sits in a brown piece of leather in my pocket, or more often than not just lying on a table somewhere. Anyone could take it and run off with it and I'd have no hope of getting it back.

Not quite -- Police take reports of lost cash seriously.  Police do not take reports of lost BTC seriously.

They can take it as seriously as they want, I still have no hope of ever getting it back. The police aren't magical wizards who can return stolen property to its owner...

[Crypt_Current]

Quote from: Crypt_Current on August 10, 2011, 12:30:44 am
Quote
My real money sits in a brown piece of leather in my pocket, or more often than not just lying on a table somewhere. Anyone could take it and run off with it and I'd have no hope of getting it back.

Not quite -- Police take reports of lost cash seriously.  Police do not take reports of lost BTC seriously.


They can take it as seriously as they want, I still have no hope of ever getting it back. The police aren't magical wizards who can return stolen property to its owner...

I understand.  There's not a lot of recourse for finding lost cash as compared with lost credit cards.  The difference between lost cash and lost BTC is, you can file a police report about lost cash whether or not they actually pursue the case.  They will understand it and allow you to file a report.  Lose your BTC, go try to file a police report, and you will likely be laughed at.

[Crypt_Current]

There's not a lot of recourse for finding lost cash as compared with lost credit cards.  The difference between lost cash and lost BTC is, you can file a police report about lost cash whether or not they actually pursue the case.  They will understand it and allow you to file a report.  Lose your BTC, go try to file a police report, and you will likely be laughed at.

Forgot to mention my main point, ha -- If police and governing agencies eventually DID take BTC seriously, recourse for recovering lost BTC would definitely exist.