the real problem with bitcoin

[JohnBlack]

The main weakness of Bitcoin and other cryptocurrencies at the moment is that they are distributed systems depending on centralized ones (I am looking at you, banking account) that will probably try to fight them, sooner or later, in order to keep their power.

The only solution would be something that has come up repeatedly from time to time on this very forum and on many others, a decentralized bitcoin exchange (if possible integrated into the client, you don't want a website that can go down for that) based on a web of trust (a la http://bitcoin-otc.com/) and including integrated escrow capabilities.

Such a system would allow people to convert fiat into btc by doing regular transactions between individuals, thus drastically reducing any possibility of regulation, or hack for that matter, that could have a negative impact on the price, less FUD, on the other hand, could probably mean a more stable price over the long run.

ps. I don't see Ripple as being a solution, there is no need to add another crypto to the mix in my view


What do you think? Is there anything like that on the roadmap? Is there any credible project out there as far as you know?

[Reece523]

If Bitcoin continues to gain in popularity, maybe even Local Bitcoins itself will allow for people to avoid having to deal with banks.

[JohnBlack]

If Bitcoin continues to gain in popularity, maybe even Local Bitcoins itself will allow for people to avoid having to deal with banks.

except that it is still a centralized website, that can go down or be hacked, such a capability should be built right into the client in my opinion

[betyourbits]

Great point.. I think a decentralized exchange should be possible, I just don't know how the originating fiat will transfer between users without a bank though.  We could mail it to each other using carrier pigeons

[Imahara]

http://LocalBitcoins.com

works for me...

[JohnBlack]

Great point.. I think a decentralized exchange should be possible, I just don't know how the originating fiat will transfer between users without a bank though.  We could mail it to each other using carrier pigeons

the idea is that the system would facilitate and increase standard transactions among individuals, so there would be no way to know that a bank transfer was made to buy bitcoins, something which is very easy to spot and regulate if the account holder is MtGox instead.

[taltamir]

Is there a way to receive bitcoin AS cash?

That is, mow the lawn for someone and get bitcoin. Sell a used video card on craiglist and get bitcoin. Taxi cap someone and earn bitcoin. etc?

[betyourbits]

Great point.. I think a decentralized exchange should be possible, I just don't know how the originating fiat will transfer between users without a bank though.  We could mail it to each other using carrier pigeons

the idea is that the system would facilitate and increase standard transactions among individuals, so there would be no way to know that a bank transfer was made to buy bitcoins, something which is very easy to spot and regulate if the account holder is MtGox instead.

Ah okay, that makes sense.  So we really just need a bittorrent like client application to facilitate p2p trading of bitcoin with wire transfers.

[taltamir]

Great point.. I think a decentralized exchange should be possible, I just don't know how the originating fiat will transfer between users without a bank though.  We could mail it to each other using carrier pigeons

the idea is that the system would facilitate and increase standard transactions among individuals, so there would be no way to know that a bank transfer was made to buy bitcoins, something which is very easy to spot and regulate if the account holder is MtGox instead.

Ah okay, that makes sense.  So we really just need a bittorrent like client application to facilitate p2p trading of bitcoin with wire transfers.

The "tone" of your post suggests you are being sarcastic and such a thing exists already.
Am I misunderstanding? If not, what is it called?

[Soros Shorts]

http://LocalBitcoins.com

works for me...

Works for me too. I sell a lot to people using methods like BofA instant transfer. The caveat is that you must trust the buyer and make sure he is not someone who is paying you with a stolen bank account.

[JohnBlack]

http://LocalBitcoins.com

works for me...

Works for me too. I sell a lot to people using methods like BofA instant transfer. The caveat is that you must trust the buyer and make sure he is not someone who is paying you with a stolen bank account.

you are right that is a problem you could run into when dealing directly with individuals, on the other hand nobody has still any idea about the real owners of btc-e, a very well known "standard" exchange as we speak.

my point is that capabilities like those of localbitcoins should be integrated with a trading engine like that of a standard exchange (bitstamp,..) and made part of the client itself, thus avoiding any need to rely on a website for the trading to happen.

If such a system would have been in place now we wouldn't have seen such a negative reaction from china, unless their government decided to ban bank transfers altogether, which is quite unlikely if you ask me.

[qiwoman]

I think personally we need to build infrastructures away from the mainstream gas and oil suburbia like small micro communities dedicated to cryptos and BTC. If we had small vibrant little village communities all using Bitcoin and mining and living off the grid and sustainable I think it would work for the true benefit of humankind As long as BTC is just in the hands of Ruthless Speculators and not adopted enough by the Mainstream folks it is intended for then yes I believe there will be more volatility and problems

[taltamir]

I think personally we need to build infrastructures away from the mainstream gas and oil suburbia like small micro communities dedicated to cryptos and BTC. If we had small vibrant little village communities all using Bitcoin and mining and living off the grid and sustainable I think it would work for the true benefit of humankind As long as BTC is just in the hands of Ruthless Speculators and not adopted enough by the Mainstream folks it is intended for then yes I believe there will be more volatility and problems

Historically this just lead to violence from the establishment as the reconquer such communities

[JohnBlack]

I think personally we need to build infrastructures away from the mainstream gas and oil suburbia like small micro communities dedicated to cryptos and BTC. If we had small vibrant little village communities all using Bitcoin and mining and living off the grid and sustainable I think it would work for the true benefit of humankind As long as BTC is just in the hands of Ruthless Speculators and not adopted enough by the Mainstream folks it is intended for then yes I believe there will be more volatility and problems

bitcoin should integrate its trading engine in order to go truly mainstream in my view, if people could be safe from uncertain regulation or disappearing/hackable exchanges I am sure they would buy lots more and eventually even switch to it.

[jbreher]

We might be able to eliminate the localbitcoins single point of failure by employing bitmessage. I don't know much about that system, but it seems to me that bids and asks, each with country and mail/zip codes, and public key could be published on a dedicated chan. Interested partied could contact the publishers of the bid-or-ask-price/zip/public-key at that public key, in order to meet or otherwise consummate the transaction. Just speculating, though.

[zagerfish]

you could have a decentralized exchange but it would have to use visa or mastercard or paypal or something.

I'm not really sure how you would do it without using a bank, unless it was a physical cash payment.

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[titulng]

yes, this is a problem, but I think mtgox & lakebtc  etc  is solving it.