Public Relations

[Gavin Andresen]

So with the recent avalanche of press interest in bitcoin, I thought I'd share my thoughts on how I'd like to see bitcoin positioned.  I'm not writing this as "This is the Official Bitcoin Organization Position" -- as always, I expect everybody to have, and express, their own views.

I'll restate what I see as the goal of The Bitcoin Project:  To give us control over our finances by establishing a stable, secure, global, "democratic" currency.

I think positioning bitcoin as "revolutionizing the financial system" is the goal-- not more radical statement I've heard (like "destabilizing governments").  Most people either like or are indifferent to their governments (I know, I know, sheeple and all that... lets not go there).  I don't think most people get the warm fuzzies when thinking about bankers and Big Corporations; bitcoin as "The People's Money" is the right way to think about it.

Also, whenever I talk to the press, I try to be realistic.  Bitcoin is still an experiment that has never been tried before; there is still a good chance it will fail, and there is still a lot of work to do to make it stable and secure.  I'm excited because bitcoin is a big idea that might change the world for the better, but I also realize that our little project is just a baby compared to the decades-old financial systems that we all use every day.

I think it is important to set expectations; I still wouldn't recommend that my mom use bitcoin for anything just yet, because it is not easy enough to use securely.  And the road ahead is likely to be bumpy; there will be technical issues that need fixing, there will be legal questions, there will be price bubbles, and there will be scams.  I predict that some company using bitcoins to do something illegal will be caught and prosecuted, and that will be mis-reported as "Bitcoin is illegal."

I said a year ago that creating solid technology was just the first step in a long road for bitcoin.  I'm very pleasantly surprised at how far the bitcoin project has come in a year; the innovation and experimentation and level of interest and excitement is fantastic.


Here's an email exchange I had with a reporter yesterday:

Specifically, do you agree or disagree that this project is "dangerous"? If you disagree, how would you describe the potential significance of bitcoin in a future Internet economy?

New technologies are always at least a little bit dangerous-- they can usually be used for both good and bad (think of gunpowder or ChatRoulette), and are certainly dangerous to the status-quo that they replace (think of cars and buggy-whip-manufacturers).

Bitcoin is a really ambitious project; we're trying to let people take back control of their money instead of trusting bureaucrats or bankers or politicians to keep it stable and safe. It is international, decentralized, and completely open to innovation, very much like the Internet.  Like the Internet, I expect its early years to be full of amazing successes and spectacular failures, and I don't think anybody will be able to predict in advance what will succeed and what will fail.

I think the real question is whether or not bitcoin will appeal to the majority of people who are happy with our current financial system. If it doesn't, bitcoin may fade away or end up as a niche currency used for a tiny percentage of global financial transactions.

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[davout]

I think bitcoin's success also depends a lot on the collapse or partial collapse of the financial system as we know it.

[Dusty]

I agree with Gavin, very balanced view of the facts.

I think bitcoin's success also depends a lot on the collapse or partial collapse of the financial system as we know it.

Dollar and Euro are on the way to failing for a lot of reasons that who understands inner economics knows, anyway for that event to foster Bitcoin usage it's necessary that Bitcoin would be much, much more widespread.

[berlin]

Nice one Gav, precisely the right tone.

[rezin777]

I think the real question is whether or not bitcoin will appeal to the majority of people who are happy with our current financial system. If it doesn't, bitcoin may fade away or end up as a niche currency used for a tiny percentage of global financial transactions.

I think one of the problems with acceptance will be that people won't realize why Bitcoin is better. It's not that they are happy with the current system, but that they don't understand why they shouldn't be happy with it to begin with. An ignorance is bliss type of thing.

And then there are the people who defend the current system for whatever reason. I've seen a bunch of intelligent people put a whole lot of effort in pointing out Bitcoin's faults all while defending the system they are used to.

So it usually does tend to come down to politics. If you are a big fan of other people controlling things for you, and a surprisingly large number of people are, you won't see any benefit to using Bitcoin.

I agree with davout, the more damage the current financial system causes, the more people will value something like Bitcoin.

[Dusty]

I think one of the problems with acceptance will be that people won't realize why Bitcoin is better. It's not that they are happy with the current system, but that they don't understand why they shouldn't be happy with it to begin with. An ignorance is bliss type of thing.

What you say is right, but if bitcoin gains acceptance even the dumbest guy is able to understand that BTCs value continuosly gain value over traditional currencies.
That is unavoidable since after a few years bitcoin inflation is minimal compared to inflation of, e.g., dollar: in just a couple of years QE and QE2 more than doubled the monetary base of dollar...

[Mike Hearn]

Fully agree! I think it's definitely worth playing the "banking is broken so why not try something new" angle.

If you read the Economist, newspapers and so on it's pretty clear that policy makers don't really know how to fix the banking system we have today. Moral hazards abound with no way to remove them. Capital requirements are essentially arbitrary, even the most ambitious levels being proposed now wouldn't have saved Irelands banks for instance. So I think people will be quite sympathetic to the idea that it's time to experiment with new ideas in finance.

I was thinking a lot lately about different end games for Bitcoin, and how it can avoid ending up trapped in an irrelevant niche. I agree with Gavin that it's the most likely failure mode. I don't want to start an OS flamewar (pleeaase not that), but some years ago I (along with a lot of others) put in a lot of effort to desktop Linux, a project that suffered this fate. It grew rapidly until it reached about 1% usage and never managed to go further. It's worth thinking about why that might have been and how Bitcoin can end up more like Wikipedia, a project that had similar a ideological background but managed to go mainstream and touch the lives of hundreds of millions of people.

I have a bunch of ideas on that topic but limited energy. One nice thing about Bitcoin is that it's in everybodies interest to spend coins, so bounties and generally paying people to do work can achieve great results. For instance the weusecoins site was the result of a bounty though Stefan is now working more on infrastructure type projects.

I'd be willing to contribute to a fund for further development of the website, to make it look less like an open source project page and more like what you'd expect from a professionally driven project. Consider the difference between dwolla.com and bitcoin.org to see what I mean .... the weusecoins site is much closer to what the official site should look like, and I think it's not a co-incidence that the latter was funded by a bounty.

With respect to the rather negative things some bloggers, etc have been putting out, I think that's a natural pushback against people over-enthusiastically marketing Bitcoin as The Next Big Thing GET IN NOW AND GET RICH QUICK. It just pisses people off and makes the whole effort look like a scam. If the official website struck a tone more like Gavins, stating that this is an experiment with potential, it'd probably moderate some of the criticism. Not blowing off peoples concerns with a set of one-liners under a section titled "Myths" would help too

[goatpig]

I think the real question is whether or not bitcoin will appeal to the majority of people who are happy with our current financial system. If it doesn't, bitcoin may fade away or end up as a niche currency used for a tiny percentage of global financial transactions.

2 points towards that:

1) Even though people are culturally attached to strong governments, they are also culturally repulsed by the financial world in general, particularly by banks and bankers. I think one of the strongest sales pitch of Bitcoins to the masses is that it allows them to completely bypass banks. It doesn't matter how hard people are attached to the government and the currency it issues, this aspect of Bitcoin will sway them, because the populace instinctively knows their hero, the government, will never do a thing about the banks.

2) Tax evasion. Countries with high taxes also know a high level of tax haters and wannabe evaders. I am thinking about Western European countries. A tax inspector in France is akin to a rapist in people's heart. A more critical example is Greece, where tax evasion is almost a national sport. It is estimated over 60% of the Greeks evade taxes, and the government, under the pressure of the IMF and the EU, is starting a witch hunt. I think these people, even though they might not understand the full set of Bitcoin advantages, have a strong incentive to join it too.

[cypherdoc]

why is it that everyone who is ignorant about btc has to ask you "is it dangerous"?  b/c thats always so front and center in your interviews, i think u need to take the opposite angle and say NO, its not dangerous.  its the way for the majority of citizens across the world to gain back their independence from the financial manipulators.  its not the USD per say that we're against; its the banksters who twist the system to their advantage.

i think the way u have to approach your interviews is to ask the fundamental question, why is this happening?  what is the problem?  the answer is simple and is clearly represented by the graph of the value of the USD declining almost 100% in the last century since the advent of the Federal Reserve.  i like to explain it to ppl by drawing a graph of the US monetary supply; essentially an upward parabola and contrast it with a graph of btc generation which is a leveling off.  the stark contrast immediately registers with the avg persons understanding.

[N12]

I fully agree with Gavin. Most people are not anarchists.

It’s way too valuable to remain in the claws of a tiny, extremist community (no offense, guys).

Bitcoin is just like the Internet, like Email, like Bittorrent. Bitcoin = People.

[ribuck]

The Bitcoin project couldn't have a better spokesman than Gavin, in my opinion.

Bitcoin works unbelievably smoothly and efficiently for geeks. All that needs to be done to achieve widespread success is to make it work smoothly, efficiently and safely for non-geeks.

The other things that people worry about (exchange rate fluctuations, lack or merchants, etc) will all sort themselves out in the end.

There's no hurry for Bitcoin to grow quickly. Provided it keeps growing slowly, it will get there. Much worse would be quick growth followed by a massive setback due to (e.g.) a wallet-stealing virus.

[ribuck]

Bitcoin is just like the Internet, like Email, like Bittorrent.

Well which is it? In developed countries, most people have used the internet, and most people have used email, but Bittorrent is a niche. A huge niche, for sure, but most people haven't used Bittorrent.

In my family (7 people over 3 generations), I'm the only one who has used Bittorrent. And only for downloading Linux ISOs, not movies or music. My kids use YouTube and iTunes for music and movies. My parents and parents-in-law use CDs and DVDs, even though they use email and the web.

Bitcoin will be like Bittorrent at best. I would still count that as hugely successful. At worst, Bitcoin will be like Esperanto: useful to its adherents, but not taking the world by storm.

[RodeoX]

Thanks Gavin. I do find this informative. Especially as we try to coordinate our efforts in communicating with the press. I especially thought the part about being moderate and realistic was important. Another example of where words are important is the idea of anonymity. I often use "private" instead.  Anonymity sound like you are hiding something. Private sounds like you have the right to hide something.

[N12]

Well which is it? In developed countries, most people have used the internet, and most people have used email, but Bittorrent is a niche. A huge niche, for sure, but most people haven't used Bittorrent.

My point was that it could be marketed as a universal standard. Bitcoin can become the Internet’s standard currency just as Email is a standard for communication via the Internet.

Bitcoin will be like Bittorrent at best. I would still count that as hugely successful. At worst, Bitcoin will be like Esperanto: useful to its adherents, but not taking the world by storm.

I disagree. Bitcoin could be much bigger than that. Just imagine if it was widely used as a currency over the Internet … It’s a long way there, but I believe many people would feel good boycotting PayPal and supporting a truly free currency. Many already do.

[Giulio Prisco]

Right. Remember that many Internet users don't know how to copy/paste.

Bitcoin works unbelievably smoothly and efficiently for geeks. All that needs to be done to achieve widespread success is to make it work smoothly, efficiently and safely for non-geeks.

[davout]

Right. Remember that many Internet users don't know how to copy/paste.

Natural selection is here for a reason.

[Fleembit]

The whole "government is evil" and "fiat currencies are doomed to fail, hoard gold!" sentiments all over this forum are a real turn off. In America extreme-libertarian views seem to be in fashion, but for the rest of the world those sort of arguments just make you look paranoid and juvenile.

The way I would describe Bitcoin to people is sort of like a Paypal replacement, but one where your account cannot be frozen based on the whims of a computer algorithm, and 'undesirable' customers like Wikileaks cannot be dropped from the system by government pressure. Basically, a secure and fast way to send money between two endpoints on the internet, without needing to have it approved by a third-party. I love that the scarcity (and hence value) of the currency is derived from the laws of mathematics (cryptography in particular), but 99% of people have never heard of Public/Private key cryptography, we probably need a good metaphor to explain that part.

I would say the #1 priority is making Bitcoin easy to set-up and use by merchants, maybe a new YouTube video with that as its major theme. The #2 priority is to make it easy for people to transform dollars into Bitcoins, there needs to be a Dwolla-like method set up in every country in the world, at the moment only Americans can easily get a hold of Bitcoins without mining. The #3 priority is making the client more user-friendly for non-technical people, in particular backing up and securing the Wallet.dat file is essential.

Just my 2 cents.

[unk]

as a suggestion against short-term self-interest (and against the interests of enough other early adopters that it won't be popular), i am convinced that the absolute best thing for the bitcoin technology at this moment would be for gavin to release a version of the client that restarts the block chain.

a controlled popping of the speculative bubble now would be better for the technology's perception than the uncontrolled one that is more likely, and it would help put to rest (or at least delay) the 'get rich quick' mentality that mike rightly criticises. better that a few early speculators lose a bit of money (which they knew they could lose) than that the broader public be functionally defrauded and walk away with the sense that bitcoin is necessarily a scam. high risk, high reward, as we always say.

restarting the block chain would also, incidentally, allay the mounting public concerns i see about the initial distribution of bitcoin wealth. in interviews, gavin has often said things like 'we'd choose a fairer distribution if we could, but what else is there?' this is one such alternative.

bitcoin will face challenges, rightly, when it appears to be a ponzi scheme (in its classical definition, which is just a scheme that pays early investors with proceeds from later investors, not one that requires outright promissory fraud) that rewards a mysterious anonymous founder, people who proclaim in other discussions how they dealt sharply with business partners in order to acquire in excess of 300,000 btc, and so forth.

that will always happen to some degree, but on balance, in terms of public reception, we are off to a bad start. journalists' complaints, however, aren't fundamentally about bitcoin. they are more about the presently popular block chain. the problems in perception associated with nature of that chain are probably insurmountable if bitcoin is ever to be more than a niche technology.

everyone would still be free to continue to use the existing block chain as they see fit, of course, so this isn't an infrigement on 'liberty'.

[davout]

#1 priority is making Bitcoin easy to set-up and use by merchants

working on this one

[xf2_org]

What I tell people:  bitcoin is a startup currency, with any numbers of possibilities for failure.

But it is totally different from anything else out there; it is literally a new kind of money in many different ways, and a very exciting and fun experiment.

[Anonymous]

If Bitcoin is going to fail, it's not going to be because of a software bug or security issues but something inherently wrong with the design of the system itself and the social science that goes along with it.

[jed]

I agree with Fleembit.

This is what I said in another thread. But is more appropriate here:

The problem is the way bitcoin is presented. You guys all like it because you are libertarian types. But keep in mind that the vast majority of people in the world aren't. But bitcoin doesn't just appeal to libertarian types. All you need to say to promote it is:

Bitcoin is a free paypal that anyone can use.

Please leave the libertarian, going to replace all other currencies, take over the world stuff out of it. That just turns people off.
The only important thing for people to know is that it is better than what people use now for online payments.

People had other ideas but you get the point. Something short and simple that people can understand. Something that let's them clearly see why they should use it regardless of their ideology.

Gavin: I think your portrayal of it above is definitely better than the forums. I still think it should be toned down.  I feel like "revolutionizing the financial system" is still too up in people's mix.

I understand most people want that to happen but a) it isn't realistic b) it scares people c) it antagonizes people that are powerful
My point is if you want bitcoin to be as big as it can be and have the biggest chance of "replacing banks" you should downplay this hope. Let them come to you. There is no point in yelling this is a revolution. Just let the revolution quietly happen.

Also bitcoin can definitely succeed without doing all this revolution.  It is already useful and used.

[jaromil]

This post is worrying as it follows the arbitrary removal of Genjix from the list of developers, right after the /. interview you made with him.

Now you ask to normalize the public views which, on top of this events, implies you are fencing the bitcoin project from the people who don't have your same view. I understand your arguments, yet I believe that no matters how much one pushes him or herself to the fringes, everyone should be aloud to speak their point of view and share it, in primis people who have contributed to Bitcoin in the first place.

I just hope this doesn't go unnoticed, as it marks the passage of bitcoin from the *community* stage to the *project* lead.
To those whose attention on the topic will survive long enough the sentence whether it was really necessary or not for Bitcoin.

FWIW and if you are wondering I'm not genjix thug nor he ask me to write this 1st stupid post in what might soon become "your forum", this is my open agenda in all this http://DYNDY.net and not particularly interested in such turf wars, but feeling the need to highlight what is really happening in this thread.

ciao

[mewantsbitcoins]

I agree with Fleembit.

This is what I said in another thread. But is more appropriate here:

The problem is the way bitcoin is presented. You guys all like it because you are libertarian types. But keep in mind that the vast majority of people in the world aren't. But bitcoin doesn't just appeal to libertarian types. All you need to say to promote it is:

Bitcoin is a free paypal that anyone can use.

Please leave the libertarian, going to replace all other currencies, take over the world stuff out of it. That just turns people off.
The only important thing for people to know is that it is better than what people use now for online payments.

People had other ideas but you get the point. Something short and simple that people can understand. Something that let's them clearly see why they should use it regardless of their ideology.

Gavin: I think your portrayal of it above is definitely better than the forums. I still think it should be toned down.  I feel like "revolutionizing the financial system" is still too up in people's mix.

I understand most people want that to happen but a) it isn't realistic b) it scares people c) it antagonizes people that are powerful
My point is if you want bitcoin to be as big as it can be and have the biggest chance of "replacing banks" you should downplay this hope. Let them come to you. There is no point in yelling this is a revolution. Just let the revolution quietly happen.

Also bitcoin can definitely succeed without doing all this revolution.  It is already useful and used.

I have a slightly different take on it. If you don't believe in changes that Bitcoin is going to bring - that's fine, but just consider that possibility.
If we downplay the implications of Bitcoin, when things actually happen it won't be pretty. I know that for the majority it's easier to just look the other way and ignore problems, like they do with current financial system, but in my opinion people who start using Bitcoin should be fully aware what may be the consequences - good and bad. It will help to build a stable user base.
I do, however, agree that some views expressed on this forum(including my own) can be extreme and unnecessary.

[Timo Y]

as a suggestion against short-term self-interest (and against the interests of enough other early adopters that it won't be popular), i am convinced that the absolute best thing for the bitcoin technology at this moment would be for gavin to release a version of the client that restarts the block chain.

Great, then we would have two competing currencies, Bitcoin v1 and Bitcoin v2. Until somebody comes along and thinks that Bitcoin v2 is unfair too, and starts a Bitcoin v3.  The community would be split into three tribes, The Pioneers, the The Restarters, and The Laggards.   The majority of users (who don't care about our politics and just want Bitcoin to work) would end up purchasing all three of them anyhow, to make sure their cash is accepted everywhere.

As if Bitcoin wasn't confusing enough for newbies already.   KISS.

[genjix]

@Jaromil - I think there was a misunderstanding. Sirius has taken me off bitcoin.org because I am not considered a core developer. I think there are simply so many things happening now and since our projects are more long term, it is easy for people not to see the extent at which I am involved. I will send him a message and clear it up.

no worries

[unk]

@forever-d, multiple competing chains could be quite robust without ever getting in the way of e-commerce, but we can cross that bridge when we come to it. for now, we could think of a restart as what happens when we move out of 'beta' toward real production. this is a particularly good moment in time to consider it.

(another way to say it: you can't prevent other people from starting new block chains. what's hard is getting new chains to benefit from the network effects of a community. better gavin, now, than paypal, citibank or facebook in six months.)

many bloggers and journalists are specifically recommending against adoption because of the history of the current block chain. they don't say it that way, but it's what their arguments boil down to. that block chain comes with a get-rich-quick mentality and has been overpromoted in speculative terms. and what's the reason to keep it, really, except to reward people like us in ways the public won't particularly want and at best will be neutral to?

with a new chain, gavin's promises in interviews that 'everyone can be an early adopter' would be more nearly true. and bitcoin would more clearly stand or fall as a payments system, not as a quirky speculative store of value subject to manipulation that's scaring people away. restarting the chain, at this particular moment in time, emphasizes payments and deemphasizes speculative bubbles. the more people use it to make transfers, and the fewer who use it as a retirement-planning vehicle that appeared one day from heaven, the more likely the technology will be important and help people.

[wumpus]

as a suggestion against short-term self-interest (and against the interests of enough other early adopters that it won't be popular), i am convinced that the absolute best thing for the bitcoin technology at this moment would be for gavin to release a version of the client that restarts the block chain.

I think you see this wrong. The whole idea that the currency can be 'rebooted' at any moment and people will lose everything they have is a reason people will stay away from it. If you do it once, they will think you'll do it every time something happened that you don't like. The idea of a completely digital distributed currency is already scary enough for most without such crazy ideas.

[goatpig]

@forever-d, multiple competing chains could be quite robust without ever getting in the way of e-commerce, but we can cross that bridge when we come to it. for now, we could think of a restart as what happens when we move out of 'beta' toward real production. this is a particularly good moment in time to consider it.

(another way to say it: you can't prevent other people from starting new block chains. what's hard is getting new chains to benefit from the network effects of a community. better gavin, now, than paypal, citibank or facebook in six months.)

many bloggers and journalists are specifically recommending against adoption because of the history of the current block chain. they don't say it that way, but it's what their arguments boil down to. that block chain comes with a get-rich-quick mentality and has been overpromoted in speculative terms. and what's the reason to keep it, really, except to reward people like us in ways the public won't particularly want and at best will be neutral to?

with a new chain, gavin's promises in interviews that 'everyone can be an early adopter' would be more nearly true. and bitcoin would more clearly stand or fall as a payments system, not as a quirky speculative store of value subject to manipulation that's scaring people away. restarting the chain, at this particular moment in time, emphasizes payments and deemphasizes speculative bubbles. the more people use it to make transfers, and the fewer who use it as a retirement-planning vehicle that appeared one day from heaven, the more likely the technology will be important and help people.

You are saying people will be reluctant to join Bitcoin because early adopters return on high risk investments makes the outsiders so jealous they'd rather give up on the economical advancement of Bitcoin altogether, and your proposed solution is to smite those early adopters that got Bitcoin where it is now to allow newcomers to get that profit for themselves instead?

[jed]

unk: I don't think it is a bubble. There are just more users now than when it only cost .06 but basically the same number of coins. Don't you expect the price to roughly correlate with the number of users?
The exact same thing would happen if you somehow managed to start a new chain.

[tomcollins]

I'm always relieved to see how realistic Gavin is about the project.

[tomcollins]

@forever-d, multiple competing chains could be quite robust without ever getting in the way of e-commerce, but we can cross that bridge when we come to it. for now, we could think of a restart as what happens when we move out of 'beta' toward real production. this is a particularly good moment in time to consider it.

(another way to say it: you can't prevent other people from starting new block chains. what's hard is getting new chains to benefit from the network effects of a community. better gavin, now, than paypal, citibank or facebook in six months.)

many bloggers and journalists are specifically recommending against adoption because of the history of the current block chain. they don't say it that way, but it's what their arguments boil down to. that block chain comes with a get-rich-quick mentality and has been overpromoted in speculative terms. and what's the reason to keep it, really, except to reward people like us in ways the public won't particularly want and at best will be neutral to?

with a new chain, gavin's promises in interviews that 'everyone can be an early adopter' would be more nearly true. and bitcoin would more clearly stand or fall as a payments system, not as a quirky speculative store of value subject to manipulation that's scaring people away. restarting the chain, at this particular moment in time, emphasizes payments and deemphasizes speculative bubbles. the more people use it to make transfers, and the fewer who use it as a retirement-planning vehicle that appeared one day from heaven, the more likely the technology will be important and help people.

You are saying people will be reluctant to join Bitcoin because early adopters return on high risk investments makes the outsiders so jealous they'd rather give up on the economical advancement of Bitcoin altogether, and your proposed solution is to smite those early adopters that got Bitcoin where it is now to allow newcomers to get that profit for themselves instead?

People ARE jealous.  Human nature and all.  Except he'd raise a fit if the next generation wants to wipe out his coins.

[unk]

@jed: by no plausibly conceivable measure is there enough new money in the system to justify the current price increases fundamentally. the price is only an expectation of future 'value'. that doesn't logically entail that it's a bubble, but almost everyone who's looked closely at it thinks it is. mike is trusted more around here than i am, for good reason given his longstanding contributions, and he agreed with me and wrote in another discussion:

there is a bubble, and when it pops it will unfortunately tarnish the name of Bitcoin for a long time. I don't think it's avoidable, better to just hope it happens soon and we get it over/done with.

i'm suggesting that we have a good opportunity, at this particular moment in press coverage and in the growth of the user base, to prevent this. it won't last forever, nor will the press coverage. the press moves on very quickly, as will most users at present. i want to see the technology succeed far more than i care about the wealth that inheres in the current block chain. it's mostly random 'wealth' anyway, and it's most probably not going to last to begin with.

@goatpig: that's not at all what i'm saying. i don't care much about the original distribution, and i'm agnostic as to whether the public will either. as i said, it's just an incidental observation of a potential benefit to a restart.

[ribuck]

... an incidental observation of a potential benefit to a restart.

But don't you see that, a couple of years down the track, the next wave of new users will complain about the early adopters of the restarted chain, and the block chain will need to be restarted again ... and again ...

[cloud9]

Only ease of use, especially now that non-tech savvy people want to join - will prevent Bitcoin from being a niche.  Ease of use in exchanges, Bitcoin-otc is not for non-tech savvy people, Liberty Reserve is for people who are willing to jump through a lot of loops.  If Bitcoin-otc can have a simple username, password system with a catchy web url and drop down menus of what the user have and wants and then the site gives the match and the transaction is automatically handled through clearcoin - then we are talking mainstream.

[Garrett Burgwardt]

Only ease of use, especially now that non-tech savvy people want to join - will prevent Bitcoin from being a niche.  Ease of use in exchanges, Bitcoin-otc is not for non-tech savvy people, Liberty Reserve is for people who are willing to jump through a lot of loops.  If Bitcoin-otc can have a simple username, password system with a catchy web url and drop down menus of what the user have and wants and then the site gives the match and the transaction is automatically handled through clearcoin - then we are talking mainstream.

I've been bugging nanotube to implement a simple password system forever.

As for the other transaction system you hint at, there was someone working on one at my behest, yet he dropped the project, unfortunately. More info here: http://forum.bitcoin.org/index.php?topic=7417.msg108906#msg108906

[unk]

@ribuck:  the simple answer is: yes, exactly. and bitcoin would be a huge success, technologically and economically, if we had that problem.

the longer answer is: such a repeated mechanism for restarts, if it serves the interests of the majority of users (or more strictly hashing power, since at that point it couldn't be prevented regardless of what we say or what gavin does) at the time, turns individual deflationary bitcoin block chains into a meta-chain of moderately inflationary currencies. thus, it's perhaps an overcomplicated way of doing what the 'inflacoin' people are suggesting, and i'd be inclined to support their efforts too.

but the more important point is that it doesn't matter. the current block chain is (conceptually) doing to gold or dollars what future block chains can do to the current block chains. none of them is going to last forever; 'this too shall pass'. satoshi knew that early on, if you read his early writings.

nothing prevents the newbies from starting up their own block chain anyway. i'm arguing that at this moment, it would be better for the bitcoin technology if gavin and the core dev team does it, while the press is still hot. it's a context-full argument; it's not amenable to political or economic generalisations, and i assure you that i understand both the bitcoin technology and the surrounding economics. (you can read my contributions to other discussions in order to convince yourself of that.)

[xf2_org]

This post is worrying as it follows the arbitrary removal of Genjix from the list of developers, right after the /. interview you made with him.

For the record, that edit was mine, not Gavin's or sirius'.  The edit was made in last 12h.

The list on bitcoin.org reflects satoshi + the people with git push access + Sirius (webmaster).

It's not intended as an exhaustive list of contributors to the overall bitcoin ecosystem.

[AtlasONo]

Keep doing what you're doing Gavin! You have exactly the correct outlook in my opinion.

[xf2_org]

Yeah, +1 to Gavin's pragmatism and realism.  That kind of thinking is the only way bitcoin will be a success.

[goatpig]

@goatpig: that's not at all what i'm saying. i don't care much about the original distribution, and i'm agnostic as to whether the public will either. as i said, it's just an incidental observation of a potential benefit to a restart.

And I think that potential affluence of newcomers will be mitigated by the effective departure of early adopters who would lose anywhere between thousands to millions of dollars in the process.

[Mike Hearn]

I understand unks argument, but given that currencies need a lot of trust in their stability I think resetting it for PR purposes would probably be counterproductive.

It's still early on in the systems lifetime and a reset now would just lead to another generation of early adopters being resented, if it were to take off. Of course if BTC pops and never again goes beyond $1 then early adopters won't be envied so much

There'll probably be a series of bubbles over time. I don't think there's much that can be done about it beyond moderating expectations, ensuring Bitcoin is not marketed by enthusiastic users as guaranteed to increase in value (it's not), and promoting real trade in goods and services.

Gavins moderate and reasonable approach to PR is exactly what's needed right now.

[ribuck]

... potential benefit to a restart.

And I think that potential affluence of newcomers will be mitigated by the effective departure of early adopters who would lose anywhere between thousands to millions of dollars in the process.

It's not even about the money. For me, the appeal of Bitcoin is that it is based on sound principles. As others have pointed out, newcomers are free to start up their own block chain if it suits their needs. Those who like the idea of restarts might find happiness if they mine the testnet.

[davout]

It's not even about the money. For me, the appeal of Bitcoin is that it is based on sound principles. As others have pointed out, newcomers are free to start up their own block chain if it suits their needs. Those who like the idea of restarts might find happiness if they mine the testnet.

Not sure about that, testnet can be reset.

[cloud9]

1 year / 2 years from now on the exponential BTC price graph today will look like the start with no visible difference between today's price and last years price.  As with anything growing on an exponential scale (long term DOW, Gold, Facebook, Google, etc) the time factor of compounding growth is always benefitting the early adopters.  The first humans who collected gold lying around in streams must have looked upon it as fairly useless... And to this day, even if you ate it, it will not fill your hunger; and is used subsequently only as a communication of value as it is valued universally (well, almost).

[niklas_a]

+1 to Gavin and to Fleembit.

The whole "destabilizing governments"-notion just puts people off. The truth is that nobody here knows how successful BitCoin will be. Instead, position it as the "open" alternative to PayPal that also is more secure and cheaper.

[marcus_of_augustus]

I think positioning bitcoin as "revolutionizing the financial system" is the goal-- not more radical statement I've heard (like "destabilizing governments").  Most people either like or are indifferent to their governments (I know, I know, sheeple and all that... lets not go there).  I don't think most people get the warm fuzzies when thinking about bankers and Big Corporations; bitcoin as "The People's Money" is the right way to think about it.

The accelerating interconnectedness of recent governments with their banking systems is what is creating the increasing possibility for bitcoin to destabilise governments, not bitcoin itself. It is just a technological tool, we don't do politics here.   I'm undecided about how up-front you should be with the mainstream for these possibilities as the odds are unclear and changing rapidly with social behaviour, i.e. unpredictably. However, it is probably a fair assumption that the entrenched financial interests currently in power will not be so friendly in how they portray bitcoin. It is after all, a threat to the monopoly that they need on money issuance, to keep current buy-in on the fiat inflation scheme widespread.

At some point, probably if bitcoin becomes adopted wider, the fact that bitcoin establishes a mechanism for citizens to enforce their right to financial privacy is going to have to be made clear, in a PR-friendly manner or otherwise. Intrusive governments violating their citizens right to financial and communication privacy are prone to destabilisation, from past history, so I think this is the most "destablising" aspect of the technology. It would be good if Jon Matonis could weigh in somewhere about a good approach of how this news should be broken to the establishment so they don't freak out too much. It saddens me when I see some half-wit reporter in Slate denigrating bitcoin potential users as "privacy freaks".

[nanotube]

+1 gavin
-1 unk
-1 on using the word 'paypal' in bitcoin marketing.

[JohnDoe]

I'm not very confident that liberals will buy the "people's money" angle. Eventually they'll figure out that welfare would become hard to provide if bitcoin took over.

[Anonymous]

I'm not very confident that liberals will buy the "people's money" angle. Eventually they'll figure out that welfare would become hard to provide if bitcoin took over.

I am willing to argue that better welfare will be provided if Bitcoin took over. People naturally love to give and will have more to give if they have more money in their pockets.

[JohnDoe]

I am willing to argue that better welfare will be provided if Bitcoin took over. People naturally love to give and will have more to give if they have more money in their pockets.

Perhaps, but then you'd have to convince them first that the free market can take care of them better than government, which is an even harder sell (bordering impossible).

[jed]

unk: Here is my response to the "is it in a bubble?" http://forum.bitcoin.org/index.php?topic=9021.msg130618#msg130618

[dissipate]

I'll restate what I see as the goal of The Bitcoin Project:  To give us control over our finances by establishing a stable, secure, global, "democratic" currency.

Gavin, no matter how you try to dress things up to paint Bitcoin in a mainstream light, this goal is completely and utterly counter to the goals of political and financial elites. Bitcoin is undoubtedly inimical to governments as we know them. Could governments exist in a world where Bitcoin was the world's dominate currency? Sure, but certainly not in the form that we know them now.

A worldwide widespread adoption of Bitcoin would raze entire multi-trillion dollar institutions run by a relatively tiny minority of bankers and politicians. This fact alone makes Bitcoin patently radical for the average 'citizen'. To sum up, there is no getting around the radical nature of Bitcoin, period.

I think the real question is whether or not bitcoin will appeal to the majority of people who are happy with our current financial system.

I don't think it is a matter of them being 'happy' with the current financial system. I think it comes down to whether or not they are more happy using Bitcoin. People's personal self interest can trump their outward 'public interest', and it does all the time, even with politicians. People who claim to be environmentalists still drive cars. People who are outward complete socialists pay the minimum they legally can on their taxes and even engage in tax avoidance. The list of things people do which violate their public ideologies in day to day private decisions just goes on and on. If Bitcoin appeals to someone's private interests in a significant way, their beliefs about the current financial system won't matter at all. All they will care about at the end of the day is whether nor not Bitcoin gives them significant 'value' over state sanctioned currencies.

To me the biggest hurdles of Bitcoin are:

1. State meddling (e.g. going after Bitcoin exchanges)

2. Network effects of existing currencies (it is not clear whether Bitcoin can ever uproot state sanctioned currencies within our lifetimes).

Bitcoin wins on the technological front, hands down. And it is only a matter of time for its infrastructure to mature and blow away all legacy banking systems on just about every feature. The viability of overcoming the network effect of existing currencies is the big unknown. If it proves too strong, Bitcoin will remain a niche currency for decades at least. If it is a lot weaker than we expected, Bitcoin will flourish.

[benjamindees]

I think "grass-roots" is a better word than "democratic".

[runcible2011]

A well written piece, Gavin.

And the road ahead is likely to be bumpy; there will be technical issues that need fixing, there will be legal questions, there will be price bubbles, and there will be scams. 

There will also be growing resistance as bitcoin takes hold. Just looking at the recent  Annie Lowrey piece in State Slate Magazine shows which way the wind might blow out of Babylon should this beautiful experiment begin to thrive. The condescending, minimizing tone of the article actually gives me hope in the viability of bitcoin. I recall the same tone being leveled at http when the web first began to take hold. People with an emotional attachment to centralized authority become personally threatened when elegant methods of routing around that authority are freely given away.

[runcible2011]

I think you should read Mises Regression Theorem to understand better the argument...

Watching the rise of bitcoin is the regression theorem writ large.

Oddly, this forum is one of the first google hits for 'regression theorem'.

http://forum.bitcoin.org/?topic=583.0

[wumpus]

I think "grass-roots" is a better word than "democratic".

+1 that's the word

[Pieter Wuille]

To me, Bitcoin is an interesting experiment. It may fail for various reasons, grow obsolete, or - who knows - change the world. Whatever happens, we'll learn a lot about independent online currencies and their feasibility, and I would sure love to see one succeed, even in just a niche market.

Also, in its current form, I don't see it as a competitor to paypal or other transaction processor. It's just this:

  The free currency of the internet.

(free as in freedom, obviously). The services built upon - including paypal-like infrastructures - grow every day, but there's a long way to go, and I hope I can contribute a bit to get there.

[matt.collier]

I think it is important to set expectations; I still wouldn't recommend that my mom use bitcoin for anything just yet, because it is not easy enough to use securely.  And the road ahead is likely to be bumpy; there will be technical issues that need fixing, there will be legal questions, there will be price bubbles, and there will be scams.  I predict that some company using bitcoins to do something illegal will be caught and prosecuted, and that will be mis-reported as "Bitcoin is illegal."

Thank you for making this point!  I look forward to the day when all of our mothers are exchanging bitcoin.

[Gabriel Beal]

I'd like to thank Gavin for being a clear-thinking and level-headed spokesperson for Bitcoin. If the technical lead were someone promoting anarchy or emphasizing the illegal activities made possible by Bitcoin, I think it would be attracting a lot fewer people.

If the block chain were restarted because of unequal distribution I would go back to paypal's cold arms in a second. That is a problem that will sort itself out over time naturally.

[Longmarch]

Something that just occurred to me that might provide clarity in the public discussion of bitcoin... and hopefully hasn't been said already:

Bitcoin "miners" aren't really mining, of course.  What they are doing is actually acting as the bankers.  Instead of a central bank, Bitcoin has a distributed bank comprised of people who have taken it upon themselves to participate in processing and maintaining the records of the bank.  The power to create money in this system is semi-randomly distributed among these "bankers" with favor given to those who contribute more processing power.

... because after all, this whole concept of "mining" bitcoins is confusing a lot of people who seem to be looking for a reason to dismiss Bitcoin.  

And I'm still surprised at the tone of anger and aggressive condescension in all these criticisms of Bitcoin that I read on the web.    

[evoorhees]

 

And I'm still surprised at the tone of anger and aggressive condescension in all these criticisms of Bitcoin that I read on the web.    

Haterz gonna hate.

[Mike Hearn]

I tried to sum up some of these points in a wiki page, see here:

http://forum.bitcoin.org/index.php?topic=9546.0

[xf2_org]

BTW, bitcoin'ers, start expecting a more probing press.

I got a bit of it on the BBC World News radio interview just finished.

The only two things they want to talk about are (a) Silk Road and (b) LulzSec hack of Sony soliciting bitcoins: http://www.cbsnews.com/8301-504943_162-20068460-10391715.html

I've been pushing back a bit on "totally anonymous and untraceable!!!" with all the Silk Road, and now LulzSec, stories, for a few reasons:

1) Bitcoins will best succeed if it is ideology-neutral.  If bitcoins are associated with nothing but criminality, it will remain in that niche.  IMO, bitcoin is far more revolutionary and empowering, and a fantastic new concept in currency.  Marginalization by the press is one way bitcoin could fall into that criminality niche and never escape.  The world deserves more

2) To be truly anonymous and untraceable, you have to take many additional steps, within and external to bitcoin.  Most new bitcoin users, using the default download in the default configuration, will not have such protections, so that's setting expections too high.  I really wouldn't want a human rights dissident thinking they are anonymous, simply by downloading and running bitcoin.  I've been pointing reporters to https://en.bitcoin.it/wiki/Anonymity with regularity.

3) IMHO, the bitcoin story is more about the attributes of the currency: highly efficient, highly secure, instant, nearly free, with a predictable and stable currency supply.

And on an odd note, nobody is interested in mining.  Very few if any questions about that.  It's all Silk Road and lulzsec and "zomg untraceable!!!"

[marcus_of_augustus]

Good work Jeff.

It is so sad to see the lame-stream media fulfill their stereotype, and jump straight into the old "sex 'n drugs sells" sensationalism, and completely miss the point of what bitcoin means to a free world.

It maybe they are trapped in a moment of disbelief, like when wikileaks started dropping the bombshells.

What if they were titillated with bitcoin tips? And then we send them a link to the block explorer showing where their bitcoin tips came from and that their bitcoins are in fact more publicly traceable than their own bank accounts.

[matonis]

At some point, probably if bitcoin becomes adopted wider, the fact that bitcoin establishes a mechanism for citizens to enforce their right to financial privacy is going to have to be made clear, in a PR-friendly manner or otherwise. Intrusive governments violating their citizens right to financial and communication privacy are prone to destabilisation, from past history, so I think this is the most "destablising" aspect of the technology. It would be good if Jon Matonis could weigh in somewhere about a good approach of how this news should be broken to the establishment so they don't freak out too much.

I just noticed this thread so I thought I would post here as well to contribute to the overall discussion started by Gavin. Here is my post from the Press Hits thread:

Bitcoin is a nonpolitical decentralized cryptocurrency with user-determined anonymity and transaction irreversibility. Most people are happy transacting on the Internet with VISA/MC/AMEX when it comes to plane tickets, hotels, gifts, etc, so bitcoin is not really a breakthrough for spending on the Internet. Terrorists, pornographers, and drug dealers already use $100 bills but that is not the fault of the innocent anonymous $100 bill and they haven't banned the $100 bill (yet). Bad guys use the roads and phones, too.

Money going digital does not mean that we have to give up any of the features that already exist with the paper $100 bill. Yet, that is the way things are being positioned by the establishment --- "give up the privacy and untracability elements of the $100 bill and we will give you the nirvana of a digital, cashless society." This is such bullshit!  MOA, I'm not sure if this news about privacy can be broken to the establishment in a delicate way, but it can be based around the common theme of liberty (i mean, come on, who doesn't believe in liberty?):

Regarding the media, I believe that bitcoin needs to be positioned as a way to restore financial privacy to the individual:

1. Secrecy does not equal concealment, but rather secrecy equals privacy;
2. Large-scale private value transfer should not be impeded across national boundaries (money laundering is a pejorative term);
3. Individuals should have freedom from confiscation and immoral tax levies;
4. Individuals should have freedom from money being used to track identity;
5. Individuals should have protection from the depreciating nation-State political currencies.

Then, using general themes like PayPal freezing accounts and reversing legitimate transactions will be certain to resonate with Joe Q. Public. Then, if you really, really want to get everyone on your side, mention how the Jews under Hitler would be labelled as 'money launderers' today simply because they attempted to move their wealth to Austria in order to avoid confiscation. The Jews in Hitler's Germany certainly would be bitcoin advocates.

[MacFall]

I am willing to argue that better welfare will be provided if Bitcoin took over. People naturally love to give and will have more to give if they have more money in their pockets.

Perhaps, but then you'd have to convince them first that the free market can take care of them better than government, which is an even harder sell (bordering impossible).

Bitcoin won't be what does the convincing. In my experience the thing that brings liberals around to accepting the free market is when they reject the violence which is the state's only means of accomplishing anything.

[MacFall]

I think "grass-roots" is a better word than "democratic".

2nd'd

[RodeoX]

BTW, bitcoin'ers, start expecting a more probing press....

Good stuff. It's nice to know there are some grown ups here to shape the future of bitcoin. When I have finished my presentation notes I will post them here for others to use.

[Giulio Prisco]

I think "grass-roots" is a better word than "democratic".

2nd'd

3rd'd

[Nels]

I think the analogy is the Internet and pornography.  People try desperately to lower transaction costs.  The internet did that for porn and in the early years porn traffic dominated net usage. Anecdotally I've heard there is around a 20% haircut for black market transactions (drugs, money laundering, etc).  So we should expect the majority usage early on for bitcoins will be for black market transactions.  I don't think that's a bug, it's a feature.  It's hard to get people to change behavior.  There is big motivated market that like it or not is very incented to adopt new solutions. Bitcion is what it is.  What better beta testers than the black market. ; )

[billyjoeallen]

Has anyone noticed that the press has been almost universally bad for four days and bitcoin has barely dropped $0.50/BTC??  If that's the best the haterz can do (even using a sitting Senator!), the I think we are in pretty good shape.

[RodeoX]

I wonder how bad the "bad" press has been? As mentioned above, it has not dropped the market. Indeed there has been a rally. The people who show up here after hearing about silkroad may be moving beyond that once they realize the real power and utility of bitcoin.
Not all these people are haters. Some of them are just skeptical about the claims they have heard, and ignorant of the real facts. let's not treat them as outsiders. Let's adopt them and bring them into the fold. That is how we change minds. Save your fight for PayPal and the banks.

[Vladimir]

From where I sit, I see lots of quite smart and intelligent people coming in... lots of interest and excitement.

[billyjoeallen]

I think the real question is whether or not bitcoin will appeal to the majority of people who are happy with our current financial system. If it doesn't, bitcoin may fade away or end up as a niche currency used for a tiny percentage of global financial transactions.

Even if bitcoin ended up being used in only as 1% of financial transactions, at a global GDP of over 50 trillion, 1 bitcoin would be worth more than 2 million dollars. That's a market niche I can live with.

The impact of Bitcoin will still be much larger than it's actual use.   Bittorrent lowers the price of "legal" online music even though "legal" purchases are a larger market share. Tax havens keep the taxes of other countries lower. Sometimes just the credible threat of competition keeps the potential monopolists in line.