Research what happened to American presidents who tried to end the fed.
Read about Andrew Jackson, Kennedy, etc.
Look into the Liberty Dollar fiasco.
Eventually, when bitcoin gets large enough the government is going to try to shut it down. So it's transnational. So what?
1) They have the media. Disinformation to the average mom and pop will sway them. Heck my parents don't get it now with me explaining it to them.
2) If that doesn't work they can pass laws to tax it or even make markets illegal or even running the client illegal. If they could seize liberty dollars (http://www.youtube.com/watch?v=qmNIdbl8cyk
) they will try to seize bitcoins.
3) They can launch a network attack on the system
4) Because the fed has an unlimited supply of US Dollars they can play havoc with the bitcoin exchanges. What about always owning at least half of the bitcoin supply so that they could easily manipulate the market 10 years from now if they need to. They plan long term.
What can we do to protect ourselves? We need to upgrade the bitcoin client immediately. I don't know which user on the forums is responsible for http://www.bitcoin.org/
and the official client but we need to do the following and more.
I am very new to bitcoins so these are just my observations and possibly naive suggestions after 4 days on the system. Please contribute your ideas and tell me where I might be wrong or missing something altogether.To protect against 1
Well for starters how about a nice video with pretty graphics showing how the entire bitcoin system works and why it's so wonderful. We really need a beautiful and simple video that explains the process for users who don't care about encryption and who are tired of fiat currencies and fractional reserve lending. Look at WingCash (https://wingcash.com/
). That's beautiful. I get it. We need that on the bitcoin site and the sooner the better.To protect against 2
We need to integrate tor functionality into the main bitcoin client ASAP. Why should opening port 8333 make any difference to the client. It's so easy as an ISP to block that. We can't rely on unencrypted traffic either. That is to say, bitcoin traffic should look like any other traffic on the network so that even deep packet sniffer hardware and software at the ISPs cannot tell the difference between it and average internet traffic. Can we camouflage bitcoin client traffic somehow? We need a way to do this so that ISPs can't easily shut us down. We need anonymity so that if it is made retroactively illegal or even illegal overnight, users are protected from prosecution.To protect against 3
Well I'm no expert but here I think we are SoL. Our network is small. Any estimate on the total number of bitcoin users? We will never have half of the nodes on the internet unless even webservers are running the bitcoin client.
That would be nice. Could we get bitcoin into Apache? If every linux server in the world dedicated up to 1% of network bandwidth and cpu cycles to running a bitcoin service it would help our cause tremendously. I have sites hosted and server time/space. I'd love to run it on my web servers if it wasn't a resource hog. Right now there aren't enough transaction fees to collect so there isn't much motivation for servers, however another urgent update that is needed is making use of those 8 decimal places. The bitcoin client should allow fees of 0.00000001 out of the box. It should also show balances that way. Secondly it would be great if the client started displaying balances and transactions in mBTC or milli BTC. Considering there will only ever be 28 MBTC, we should start thinking and transacting in milli BTC ASAP. It makes a lot more sense and will remove the psychological parity barrier because it will pave the way for 1 USD to 1 mBTC parity when we use mBTC as our mental currency unit. It will still give us 5 decimal places of accuracy which is more than enough for this decade. Eventually I'd like to see us move to micro BTC or uBTC so that we will have only two decimal places just like every other currency in the world.To protect against 4
First we need so many people mining that difficulty be damned, our network should be doing on the order of 10 Th/s. That way if we get another mystery miner with 600 Gh/s of processing power come online overnight they won't be able to tilt the balance of power. Basically our network should have 10 times the processing power of the world's fastest declassified supercomputer. Then it will take national security resources to really tilt the balance of power by generating coins.
How can we grow our network by 10x quickly but without media attention? Word of mouth and news on geek sites. We really don't need mainstream press right now and we also don't want single users at supercomputing facilities to be able to generate half the coins at any given time.
As for the ability for the Fed to just buy everyone out... well I have no immediate solution to that problem. Thought experiement. You are the Fed. You have a bank account with unlimited USD. Your task: Destroy bitcoin with your unlimited supply of dollars and no other tool.
I'd do it this way. Create hundreds of accounts on MtGox and other markets. Buy up all the asks driving the price up to 1.65 as of right now if I bought out the entire order book. Then sell those coins at a loss to all of the bids wiping that part of the order book out the next day. Then trade with myself at around 0.65 to establish a new "normal". Accumulate more coins from sheep and then heavy sell the market when I have 10x the number of bitcoins as the market depth for bids selling into the entire order book of bids again creating a new low. Again trade with myself to establish a new normal low. Anytime there is severe bidding activity pushing the market up, I would use my huge store of bitcoins to push it down. If I run out of bitcoins, since I can't short, I'd just buy out the entire market again and then sell sell sell. Oh what fun it would be
How could we protect against this?
P.s. Please tip if you feel I'm contributing to bitcoin's development if only in ideas. Even 0.01 BTC to me is precious.