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Comment by wladimir | Hacker News Reader

One thing with Bitcoin that still needs to be decentralized is the exchanges. This shows again that mtgox is the achilles heel. Sure, there are many other exchanges and ways to sell/buy, but it's telling (and sad) that DDoSing mtgox is an effective price manipulation method.

As the stakes grow higher Bitcoin is turning into an interesting endeavor in building resilent systems and preventing Single Points of Failure.

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It is already decentralised in the sense that there are plenty of alternatives, and there are "over-the-counter" places like Bitcoin's #bitcoin-otc.

I know that. But for some reason there is an extreme reliance on mtgox for price information. Even trades in -otc are usually based on the mtgox price. So maybe I worded it wrong, it's not so much trade that is centralized but the trade/price broadcasting.

Ah, I see. Well, there are some sources that aggregate data, like Bitcoin Charts:

http://bitcoincharts.com/markets/

Agreed. Still, bitcoincharts is a centralized site too, and could be DDoSed, overloaded, blocked, etc.

Maybe ticker/trade data could be spread over a gossip network as well. That's not as trivial as it sounds, though, for example how to check that trades are real and not just spam/manipulation. Maybe some way of authenticating exchanges by signing the packets (but then -otc would be left out... maybe their reputation system could be integrated somehow).

The reason for a lack of easy to use exchanges is the artificial cost of entry. You cannot simply set up a website to trade coins for money with some friends because of licensing, regulations, capital requirements etc. If you were free to move your money how you want on the internet without questions asked, we would have many exchanges (and probably wouldn't need Bitcoin in the first place).

If the banks ever start adopting it, then trading Bitcoins should become pretty decentralized.

In what sense are banks decentralized? Aren't those too-big-to-fail giants what we're trying to get away from in the first place? :-)

This is one of promises of Ripple. It will be interesting to see how it plays out.

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