Fuck the crash, lets just keep moving forward

[markm]

Are there any existing businesses already heavily invested in doing background checks that would be willing to permit the results of their check, verifiably being the results of their check (they sign it digitally, for example) to be made public? Maybe even made a matter of "public record" ?

-MarkM- (Why start up a whole competing background check company if one can already buy background checks?)

[Eli]

(Why start up a whole competing background check company if one can already buy background checks?)

I don't if there is an existing one, but at this point I feel like Mathew's UABB is somehow trustworthy (just by looking at his photo and reading his posts on the forum). Other firms? hell, we'll need to verify them before we can trust them, and who's going to do that if not Mathew?

[BitcoinBug]

(Why start up a whole competing background check company if one can already buy background checks?)

I don't if there is an existing one, but at this point I feel like Mathew's UABB is somehow trustworthy (just by looking at his photo and reading his posts on the forum). Other firms? hell, we'll need to verify them before we can trust them, and who's going to do that if not Mathew?

I too believe in his good intentions, but his pushy approach was a bit off to some of us. If we are to create "trust authority", this authority needs support by the community.

[Trader Steve]

It's cash. You can't regulate cash. That's what makes bitcoin useful.

But if I pay cash in real world, I expect the seller to hand me goods right away - my left hand gives him cash and my right hand takes goods from him.
If he refuses to hand me the goods, I can beat him up at the spot. Technology of inflicting severe physical damage over the internet does not (yet) exist, therefore cash can't be used online.

Cash can and is being used on the internet (that's what bitcoin is and thousands of transactions have already been successfully concluded) - you just need to know who you are dealing with and be willing to deal with the consequences of a seller not delivering.

[BusmasterDMA]

In developing a rating system, I think we should distinguish between merchants and banking services.   

A Yelp-like service could work well for merchants.  After a successful transaction (received goods) a rating/review could be written.  We would however have to invent a way to deter fraud in the rating system itself.  A determined fraudster would attempt to spam the rating system with good reviews for his fraudulent shop bad reviews for competitors.

Banking systems however would not lend themselves so well to such a rating system.  There is no way to conclude that the service provider is not a thief.  The best you could do would be to leave a review that says, "I haven't had my bitcoins stolen. Yet."  Insurance seems more appropriate than ratings for banking services.

[ErgoOne]

What BusMasterDMA said.  For merchants that accept Bitcoin, a consumer rating web site like Yelp would be an excellent idea.  For banks, a trusted independent insurance agency that has the same sorts of standards and testing regimen that non-Bitcoin banks and financial institutions must meet would be needed.  Very few consumers are in a position to rate the security and trustworthiness of a bank, any more than they are the qualifications of their doctor or the engineers that designed and built their automobiles or the bridges that they drive over on those automobiles.

That's one area where the decentralized approach to running an economy does not work so well -- at least, not yet.  Anarcho-capitalists and libertarians haven't built appropriate non-government institutions that an average person can rely upon to assess the safety and trustworthiness of work done by certain highly technical, complex professionals such as doctors, engineers and (yes) bankers or stockbrokers.  I don't believe that people will give up modern medicine, modern buildings and roads, or modern monetary systems, so there *must* be some means to support people in deciding which medical service providers, builders/engineers, and banks to trust.

[westkybitcoins]

Restrict mining and any trading to people who have verified their identity and credentials with a central authority.

We all love the idea of decentralized this, anonymous that... and you know what?  we've seen just how flawed the idea of that is.  You have hackers and scammers coming out of the woodwork because of the open, anonymous, accountability free nature of bitcoin.

That is the downfall of bitcoin.  By leaving it wide open, you encourage criminals and little kids to swarm to it and try to steal and cheat any way they can imagine with no repercussions.

OH, you're not 18?  bitcoin isn't for you.  Oh, you can't verify your identity... bitcoin isn't for you.

There you go.

But that's not going to happen. At this point, making such changes would be like trying to centralize torrents, and restrict access to the 18+ crowd.

Bitcoin is what it is folks, the protocol is not going to go through any radical changes... it's just too late.

If you think something drastically different is needed instead, your only option is to build that new, better Bitcoin 2.0 and let the "inferior" one wither away due to all its supposed flaws.

And you might not want to delay in getting the competing blockchain to market....

[nhodges]

ok so,

what can we do to restore some confidence in bitcoin??

my idea.

we should build a "web of trust"

a place where everyone can place reviews for all the bitcoin stores and services, in an attempt to weed out the good from the bad

your ideas are welcome

We are currently working on something that fills this hole. I am going to be starting a thread outlining the services we will provide at the Bitcoin Business Bureau to gather input from the Bitcoin community tomorrow evening as to how we can improve upon our ideas before launching.

[d'aniel]

Focus as much on building trust, as on making it unnecessary.  Help the developers get scripts enabled (https://en.bitcoin.it/wiki/Script) so we can use smart contracts (https://en.bitcoin.it/wiki/Contracts) to avoid needing it so much in the first place.

[doldgigger]

What crash? Someone with limited dedication to bitcoin got a share of the early huge supply of coins, and decided to dump them at the exchanges. Kind of stupid, though - he already managed to drive down the exchange rate so he gets less profit out of it. But something like this had to come sooner or later, and now he have to wait for the learning process to get started...

On the plus side, when this is over, we'll have a lot more curious people with some bitcoins as they are cheap to get now, which will make all the newly emerging bitcoin businesses prosper.

[Shinobi]

That's one area where the decentralized approach to running an economy does not work so well -- at least, not yet.  Anarcho-capitalists and libertarians haven't built appropriate non-government institutions that an average person can rely upon to assess the safety and trustworthiness of work done by certain highly technical, complex professionals such as doctors, engineers and (yes) bankers or stockbrokers.  I don't believe that people will give up modern medicine, modern buildings and roads, or modern monetary systems, so there *must* be some means to support people in deciding which medical service providers, builders/engineers, and banks to trust.

Exactly right. However, calling it "one area" implies that it is some small piece of the whole. Decentralization fails entirely because of this. Although everyone is so against "regulation" by a central authority, it is ultimately the only way to deal with this issue. The MBC fiasco should lay to rest any belief that a web of trust or other informal decentralized trust-based self-regulation system can work.

[error]

That's one area where the decentralized approach to running an economy does not work so well -- at least, not yet.  Anarcho-capitalists and libertarians haven't built appropriate non-government institutions that an average person can rely upon to assess the safety and trustworthiness of work done by certain highly technical, complex professionals such as doctors, engineers and (yes) bankers or stockbrokers.  I don't believe that people will give up modern medicine, modern buildings and roads, or modern monetary systems, so there *must* be some means to support people in deciding which medical service providers, builders/engineers, and banks to trust.

Exactly right. However, calling it "one area" implies that it is some small piece of the whole. Decentralization fails entirely because of this. Although everyone is so against "regulation" by a central authority, it is ultimately the only way to deal with this issue. The MBC fiasco should lay to rest any belief that a web of trust or other informal decentralized trust-based self-regulation system can work.

The MBC fiasco shows no such thing. And why are you so quick to run to your gunmen?

[ErgoOne]

Why the only way, Shinobi?  There is ultimately *no* difference between a privately-run bank rating and insurance company that enforces certain security and accountability standards on banks and financial institutions in return for certification and insurance coverage, and a government-run bank rating agency that does exactly the same thing.  In both cases, the agency is only as effective as the trust people put in it.  

Right now, we haven't built many private institutions that provide the same level of trustworthy information and ratings as some government agencies.  I think this is because it takes time, effort, and significant resources to build a regulatory agency, and in order to be trustworthy the agency must be completely independent of the companies it regulates.  A government can require its citizens to invest in such an agency through paying taxes, and thus obtain the money to pay for it relatively easily.  A private organization must appeal to private individuals either to invest in the agency or to pay for it as an act of charity -- for the public good.  If it appeals for investment, it must have a means of making money.  If it charges the companies that it regulates, it is at risk of regulatory capture by those companies, which can threaten to withold their money if it cracks down too hard.  If the agency appeals for donations, it is even more at risk of regulatory capture unless it specifically refuses donations from the industry that it regulates.  The only way such an agency is trusted is if it manages to overcome these pressures and both regulates fairly and is seen to regulate fairly.

A government agency theoretically answers not to the companies it regulates but to the citizens as a whole, and should (theoretically) be immune to this sort of pressure.  I often think that I'd like to move to Theory because there everything works. <wry grin>  We all know that regulatory capture of government agencies that are supposed to look out for the public interest is a HUGE problem in the United States and many other countries.  This happens because it takes people with credentials and expertise to regulate many industries, such as banks.  There is a limited supply of people qualified to understand these industries.  The industry itself provides the vast majority of jobs for these people.  Many regulators go back and forth between jobs at the regulatory agencies and jobs in the companies that they regulate.  If they regulate too aggressively, they are not welcomed back by the companies in question, not surprisingly.  The only way a government agency is trusted is if (surprise!) it manages to overcome these pressures and regulates fairly.

So, from where I sit, the big difference isn't that government agencies are (or are likely to be) more fair and impartial than private companies that do the same thing.  It's simply that funding an agency or company at a level that will let it exist and work at all is easier if you can use taxes than if you have to raise the money in other ways.

"Easier" is not the same as saying that privately run agencies are impossible.  If a large enough group of people is motivated sufficiently, there is no reason that I can see that they couldn't build a private institution that independently certifies banks and financial institutions, and provides insurance for those institutions.  They just have to think it's worth doing and be willing to put the time, effort, and resources into doing it.