Why the Only Real Way to Buy Bitcoins Is on the Streets
wired.com
wired.com
Sounds like a great way to spend money...
What exactly do you mean by "verifiable" here? What is being verified?
http://en.wikipedia.org/wiki/Protocol_of_Bitcoin#Payment_ver...
We've had lengthy discussions of this before. Where we last left off, you asked me to explain why bitcoin doesn't need "security assumptions" of the kind listed in a sample crypto paper that you provided. That's a fair question I guess, although I suspect it's ultimately based on some mistaken premise [1], but I haven't had time to read the paper.
[1] Bitcoin is a new mechanism that approximates Byzantine consensus, though AFAIK nobody has written a formal paper explaining and proving that. That is why it works. You can formalize the properties it gives you in a similar way to the original Byzantine Generals work, except that each general's votes are proportional to his rate of sha-256 hashing, rather than being one vote each. Another thing that suggests you have a mistaken premise in your dismissals of Bitcoin is that Bitcoin has been working for years now, has received massive investment, and as far as we known has never been compromised in any way.
Bitcoin suffered a successful double-spend attack [+] during a fork of the blockchain during this March, which necessitated a drop-everything-and-downgrade-your-software response from a cartel of miners to prevent us from having Bitcoin and Bitcoin Prime.
+ It was by a security researcher, not by an adversary, so the community has mostly forgotten it and those that remember would like to pretend it never happened.
But it's like getting a tour of the Tesla factory and saying, "It can't even run under water? Well gosh, this sucks!"
Blockchain forks are _going_ to happen, because software isn't perfect. That has long been known. It's always been a question of when, not if.
But they do not matter, because it's easy to heal them in precisely the way that this one was healed. Which is part of the beauty of bitcoin.
They also don't matter much because they don't have much of an impact on users unless you're doing something you shouldn't do.
> so the community has mostly forgotten it and those that remember would like to pretend it never happened.
That's pretty cynical. I'd say the community has mostly forgotten it because it wasn't a surprise to anyone in the community that it could happen, it was just a matter of when.
That the whole incident was pretty forgettable is a testament to how easy it is to heal a blockchain fork and how little impact one actually has.
This is money we're talking about. If someone finds a way to make millions of euro by "doing something you shouldn't do", by god, someone'll do it. So then what happens?
That is NOT how real business is done.
When you are engaging in trade with someone, someone has to trust the other party, or you have to use escrow. Expecially if a ton of money is involved.
Bitcoin Wallet[3] for Android and Multibit[4] do this, which is probably why they are now the recommended clients and Electrum is not.
Edit: apparently Electrum also double-checks what the server is saying with SPV. I'm a bit fuzzy on why it still needs a server.
[1] http://bitcoin.org/bitcoin.pdf
[2] https://en.bitcoin.it/wiki/Thin_Client_Security#Header-Only_...
[3] https://play.google.com/store/apps/details?id=de.schildbach....
The seller funds the transaction in the escrow service before meeting the buyer. The buyer sees it's funded and can write down a confirmation code that the seller doesn't know. Then when they meet the seller counts the cash and sends a SMS to LocalBitcoins to release the funds. LocalBitcoins responds with the confirmation code which the buyer can check then hand over the cash. No one needs any computers, only the seller needs a phone.
I tried it once and I felt like an arms dealer or something.
[1] edit: IIRC there's some proposal to be able to override unconfirmed transactions to recover coins in limbo due to no transaction fees being included, or something.
There's something about "the future" that brings us closer to film-like situations in real life. Not only the obvious sci-fi ones. Maybe it is the speed at which things are done, don't know...
The article even points out that Litecoin clients need several hours to catch up with that currency's version of a blockchain.
Is someone ever going to build a true P2P cryptocurrency, or are all of the current contenders doomed to collapse under their own mathematical weight?
But haters gonna hate.
It seems much better to send cash via mail, much more anonymously (watch out for cameras near post boxes and use gloves).
Furthermore, I think that people who would immediately conceive of Bitcoin enthusiasts as "anti-government hippie-hacker drugdealers," as well as those people who would similarly conceive of any of those things as inherently pejorative, already have their minds made up and don't need help from the supremely subtle implications of a photo.