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Author Topic: business and bitcoin transparency  (Read 1450 times)
kwukduck
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May 05, 2012, 06:56:56 PM
 #1

So, continuing from a critical video...

How can a company accept bitcoin without completely opening their financial  status to the qorld.
Are there any guides to keep this somewhat private?
How do you guys see this?

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Gabi
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May 05, 2012, 07:33:00 PM
 #2

Use different addresses for every transaction?
Stephen Gornick
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May 05, 2012, 07:56:10 PM
 #3

Use different addresses for every transaction?

Related:
 - https://github.com/bitcoin/bitcoin/pull/1017

kangasbros
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May 05, 2012, 08:08:46 PM
 #4

Use different address for each transaction. This is trivial and should be done anyhow, makes processes & tracking easier.

When spending bitcoins, they can be mixed using external service.

kwukduck
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May 05, 2012, 08:47:23 PM
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Naturaly you would use different addresses.for each transaction, but following where those transactions all come together is very easy. Using an external mixer service is tricky too, need a lot of trust to do that and it will probably be very expensive at high values and volumes, making bitcoin not so interesting for busines ... I was hoping somebody had a better idea then mixer Services.

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Stephen Gornick
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May 05, 2012, 08:53:01 PM
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I was hoping somebody had a better idea then mixer Services.

Assuming you don't want to use an EWallet or third party service (e.g., Bit-Pay.com or Mt. Gox merchant services) which breaks the link between the address used and the merchant the payment was sent, then the manual coin selection from pull #1017 might be what you are looking for:

Related:
 - https://github.com/bitcoin/bitcoin/pull/1017

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May 05, 2012, 08:55:17 PM
 #7

Naturaly you would use different addresses.for each transaction, but following where those transactions all come together is very easy. Using an external mixer service is tricky too, need a lot of trust to do that and it will probably be very expensive at high values and volumes, making bitcoin not so interesting for busines ... I was hoping somebody had a better idea then mixer Services.

So 4 random customers send you money then you pay hosting. If one of those 4 cares they'll see that... you spent the coin... maybe... or maybe you moved it to another wallet you control.

Play Bitcoin Poker at sealswithclubs.eu. We're active and open to everyone.
kwukduck
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May 06, 2012, 01:54:52 PM
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Naturaly you would use different addresses.for each transaction, but following where those transactions all come together is very easy. Using an external mixer service is tricky too, need a lot of trust to do that and it will probably be very expensive at high values and volumes, making bitcoin not so interesting for busines ... I was hoping somebody had a better idea then mixer Services.

So 4 random customers send you money then you pay hosting. If one of those 4 cares they'll see that... you spent the coin... maybe... or maybe you moved it to another wallet you control.

I'm not talking about small /home/ business, i'm talking about big business, like amazon.com or other big boys. I agree that even for them bitcoin will only get them a few transactions. But if it becomes more mainstream, so will their finances. Ofcourse normal customers won't go thru the trouble of figuring out the blockchain, but spying on competition is a big business on it's own.

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kangasbros
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May 06, 2012, 01:57:25 PM
 #9

I'm not talking about small /home/ business, i'm talking about big business, like amazon.com or other big boys. I agree that even for them bitcoin will only get them a few transactions. But if it becomes more mainstream, so will their finances. Ofcourse normal customers won't go thru the trouble of figuring out the blockchain, but spying on competition is a big business on it's own.

I don't understand why you see problems with mixing services. Usually big businesses need trustable business partners in every cases (like banks, suppliers, etc). Using mixing services you don't need that much trust to the service.

And yeah

hazek
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May 06, 2012, 02:23:47 PM
 #10

I don't understand why a business needs to hide their finances. Can someone explain this to me?

<- business noob.

My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right)

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kangasbros
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May 06, 2012, 03:08:38 PM
 #11

I don't understand why a business needs to hide their finances. Can someone explain this to me?

<- business noob.

From competitors. If all other competitors can see your revenues, expenses, etc., it is probably not very good.

There might be other reasons as well.

hazek
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May 06, 2012, 03:12:47 PM
 #12

I don't understand why a business needs to hide their finances. Can someone explain this to me?

<- business noob.

From competitors. If all other competitors can see your revenues, expenses, etc., it is probably not very good.

There might be other reasons as well.

I'm sorry if I don't take your word for it but could you please back this statement up with some evidence. How can I be hurt by my competitors if I make my finances public?

My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right)

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hazek
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May 06, 2012, 03:29:56 PM
 #13

And you don't think they should be able to undercut me with my suppliers if they can afford it? I mean if my production costs are higher than theirs isn't it better I get undercut and go out of business? And on the other hand if they undercut me just to deny me my supplier don't think they'll go out of business sooner or later because of higher costs of their production?

Your example also suggests to me that secrecy is a tool for defending my complacency and perhaps even laziness. If I work hard enough while knowing my finances are public and knowing my suppliers might be denied to me by getting undercut by my competitor I can preemptively make a deal with my supplier to ensure he wont accept someone else's business.

I don't know, but your example is far from real evidence that I was hoping someone would show to me. Perhaps a real world example would be nice.

My personality type: INTJ - please forgive my weaknesses (Not naturally in tune with others feelings; may be insensitive at times, tend to respond to conflict with logic and reason, tend to believe I'm always right)

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Stephen Gornick
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May 06, 2012, 03:58:57 PM
 #14

Ofcourse normal customers won't go thru the trouble of figuring out the blockchain, but spying on competition is a big business on it's own.

There are so many options for this.

Example, simply forwarding each incoming payment individually (using pull #1017) to an EWallet or other payment intermediary (e.g.,) Mt. Gox

To force there to be no connection between the spending party and the recipient, a redeemable voucher can be use to move BTC funds from one exchange to another (e.g., Bitconiica).   Then bitcoins can be withdrawn to a local wallet.

Problem solved.  The funds in the local wallet will have no trace of the coins where funds were originally received.

None of these transactions incurred fees (other than the regular trivial bitcoin transaction fees), the only drawback was a little administrative overhead.

Portnoy
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May 06, 2012, 04:56:30 PM
 #15

And you don't think they should be able to undercut me with my suppliers if they can afford it? I mean if my production costs are higher than theirs isn't it better I get undercut and go out of business?

 Shocked
An important part of doing business is to stay in business. 
To make a profit and do it better than your competition. 
Think of it as a kind of game.   Grin

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I don't know, but your example is far from real evidence that I was hoping someone would show to me. Perhaps a real world example would be nice.

Try this: go into any business and ask to have a look at their books.  While you are being escorted to the exit you may have a chance
to ask them some more questions...  then again they may just look at you as if you were from another planet and phone the authorities.   LOL

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Shawshank
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May 06, 2012, 07:34:55 PM
 #16

By not disclosing your thousands of Bitcoin addresses you would be trading virtually anonymously.

It is well known that big corporations usually hide profits in tax heavens. So transparency in revenues can also be a great marketing strategy for any company. On the other hand, transparency should be mandatory for governments and city halls. Bitcoin is also ideal for that purpose.

Once Bitcoin is understood, the consequences of a bank-only system are evident: your wallet is your national identity card and all private keys are handed to the government
marcus_of_augustus
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May 06, 2012, 11:49:26 PM
 #17

And you don't think they should be able to undercut me with my suppliers if they can afford it? I mean if my production costs are higher than theirs isn't it better I get undercut and go out of business? And on the other hand if they undercut me just to deny me my supplier don't think they'll go out of business sooner or later because of higher costs of their production?

Your example also suggests to me that secrecy is a tool for defending my complacency and perhaps even laziness. If I work hard enough while knowing my finances are public and knowing my suppliers might be denied to me by getting undercut by my competitor I can preemptively make a deal with my supplier to ensure he wont accept someone else's business.

I don't know, but your example is far from real evidence that I was hoping someone would show to me. Perhaps a real world example would be nice.

I'd suggest go into business and find out for yourself.

There are thousands of reasons why businesses (and individuals) need financial privacy, too many to think of and list here. Basically it is a big source of information leakage to have your finances known by the competition, think of your financial information as Intellectual Property.

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May 07, 2012, 12:26:28 AM
 #18

https://docs.google.com/spreadsheet/pub?key=0Ao892S4MOoDZdGZSbjJVd1ZTbFVLZE5aRE95bE91NVE&output=html

There are pros and cons. You want investors & buyers to feel safe with you, which is difficult to do without opening books. Just look at what a total clusterfuck the BBB (Better Bring Bucks if you want them to overturn bad reviews) has become. Outside of that, people pay for Amazon reviews, now -- they pay bloggers, too. There's a large host of tricks to boost your credit score, and I've seen it advertised on this board where you can effectively buy new credit scores. On the forum, we all know about the sockpuppets people create to "fix" their bad reputation. OTOH, maybe you don't want buyers to know the markup you're charging because you don't think you'll be able to convince them your cut is justified, or perhaps you don't want people to know who you're doing business with, maybe you have a cheap supplier you think others will try to jump on, or maybe you're trying to hide income from a gov't - or maybe you want to protect the identity of people you do business with.


It's a business decision, but I don't see why both options can't be considered, or why people wanting to know what a company's doing with their money should be looked at like they're proposing something utterly absurd, and I don't think anyone's asking for people to list every individual or company they've done business with. With BTC lending, we're all in a group and we work together. We all have our own niches, we collaborate, and we all have a good idea of what everyone else holds. We generally do "splitsies" on larger loans if we don't have enough to cover it or if we just want less exposure to the risks associated with the loan - and I can't complain about how it works out for us.

Don't mix your coins someone said isn't legal
ArticMine
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May 07, 2012, 12:47:54 AM
 #19

Is this not a huge opportunity for the traditional fiat banks? They can take the Bitcoin deposit under the bank's address and then credit the business's bank account. The only public information on the blockchain are the bank's reserves which should be public in any case. The larger the bank the better the mixing.

Concerned that blockchain bloat will lead to centralization? Storing less than 4 GB of data once required the budget of a superpower and a warehouse full of punched cards. https://upload.wikimedia.org/wikipedia/commons/8/87/IBM_card_storage.NARA.jpg https://en.wikipedia.org/wiki/Punched_card
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May 07, 2012, 01:44:15 PM
 #20

While I don't share the OP's concerns I could imagine a bitcoin-world where the tax authorities demand business to report any receiving address to them immediately. If test-buys don't result in a reporting message, the company gets trouble for not paying taxes. Today's anonymity is all nice but bitcoin has the potential for total control and we should definitely put some thoughts on how to avoid such a future.

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