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just in case someone misunderstands your post: in Russia, passport for international travel is called "foreign" passport to disambiguate it from the internal ID, which is also called "passport".

There was a law recently passed in Russia that criminalizes development, production and distribution of skimming devices. So the Russian guy selling those is probably trying to make it less likely that authorities will go after him.

Doesn't seem obvious to me at all. As a result of bankruptcy proceedings we know that Mtgox has lost primarily BTC deposits, not fiat (on mobile now, but IIRC only $27 million USD was lost which is peanuts compared to the value of lost BTC)

In other words, the situation at Mtgox was the opposite of what you describe: it had a lot of FakeBTC, bit its USD reserves were mostly real.

None

It's definitely not a problem right now. With the current block size limit (and blocks are currently filled less than 50%), it will take at least 20 years to surpass 1 terabyte.

Bitcoin has to become much, much more successful (think hundreds of millions of users) for the blockchain size to ever become a problem.

Huh? 1tb hdd was released in 2007, 2tb in 2009 and 4tb in 2011. Looks exactly like Moore's law to me though we've been set back by Thai floods of 2011.

You are correct! I was confused about this

In order to make a successful attack against a merchant accepting zero-confirmation transactions, the attacker has to:

1. Submit transaction A to miners

2. Submit another transaction B (spending the same coins as A) to the vulnerable merchant

3. This is the really hard part: make sure that the merchant doesn't know about transaction A until you got your purchase and ran away.

If the merchant has good network connectivity, it is very, very hard to perform this attack successfully, certainly not something that would be done to get a free newspaper or coffee.

Average time between blocks is 10 minutes. Your transaction will be in the middle between two blocks which results in a 5 minute average wait.

Let's say you accept bitcoin but immediately convert it to USD. In future one of your suppliers also decides to accept bitcoin. Now you can pay your supplier directly without the USD conversion step. This wouldn't have happened without you actually deciding to accept bitcoin in the first place.

I don't see any other way to bootstrap a new currency.

The parent comment said direct transfer. Bank wire involves intermediate parties, is subject to various capital limits, account closures, funds freeze etc.

To see how absurd this logic is, start with buying bitcoins first:

1. Buy 1% of bitcoins

2. Price increases

3. Sell your bitcoins for more than you bought them

4. Goto 1

If you accept a 0-confirmation transaction and listen the network for a few seconds to ensure no double-spending transactions are broadcast, this is a reasonably secure way to accept those small transactions where 10-minute delay between blocks (resulting in a 5-minute average wait) would be a problem. Of course, you'd still better wait for 6 confirmations if selling a car.

Much of Bitcoin criticism (the chicagofed paper included) is very western centric and fails to take into account how utterly dysfunctional most countries' money systems are.

In most countries in the world local currencies are unstable and subject to the whim of politicans (would you keep your life savings in argentinian pesos? Neither would Argentinians!), there are no easy ways to accept online payments, there are no easy ways to transfer money to/from abroad etcetera. I would argue that adopting Bitcoin is an immediate quality of life improvement for a big portion of the world population, moreso when/if it value stabilizes.

> Also, Bitcoin can be confiscated by the government

Not if you specifically want to prevent this. A bitcoin private key is 256-bit ECDSA, which provides 128 bits of security. If you can remember a 10 word randomly generated diceware phrase[1], you can securely store bitcoins in your brain.

[1] calculating the private key as a SHA256(phrase) for example

In theory, each coin (called transaction output in bitcoin lingo) can be traced through a chain of transactions to its originating block. In practice, this is useless because there is no correspondence between bitcoin addresses and individuals (except in certain points like exchanges that require your ID)

In other words, each time a coin changes addresses there is a plausible deniability for the owner of the receiving address that s/he received the coin as a result of a legitimate transaction (sale of goods/services, donation, whatever)

Have you tried nano?

I think this is just as unlikely as the idea that Facebook is a law enforcement honeypot to track terrorists' social graphs. Your arguments sound somewhat plausible now, but back in 2009 bitcoin was just a cypherpunk's toy and no one had any idea how big it was going to become.

I would argue that a conventional internet currency (like egold or liberty reserve) would make a far better honeypot (easier to track, shutdown at any time, cybercriminals were used to currencies like that)

It's absolutely huge. If 2/7 of the world population owned bitcoins, there would be at most 0.01 BTC per person.

Why lunacy? You need a huge amount of computing power to make a distributed currency resilient against attacks by the likes of NSA, hostile foreign states, etc.

And to answer your question, no, the chips cannot be repurposed for anything else.

> it can thrive more quickly in other parts of the world

I live in a 3rd world country and it is obvious to me that bitcoin can thrive here more quickly. Let's say I'm a freelance programmer. There is no practical way for me to receive money from clients abroad. Even if I get money somehow, there is no practical way to "legitimize" them and use for large purchases. Want to found a startup and sell stuff online? Good luck trying to get a merchant account. Want to save for retirement? Either keep money (in USD of course, not the local currency) under the mattress or trust it to the corrupt banking system that goes pop every 10-15 years.

Bitcoin is already making life so much easier.

Some nitpicking: the passphrase is not as good as it seems. It consists of two parts ("horse in a box" and "riding a fish") both of which can be found in e.g. Google's n-gram corpus [1]. The Google's corpus has on the order of 2^32 n-grams so even assuming you chose these two at random, you get only 64 bits of entropy. There is also some punctuation (let's be generous and say it gives 10 bits), so the entire passphrase is about 74 bits of entropy. While very good, this is probably not enough to protect your bitcoin life savings or a truecrypt container that can implicate you in a serious crime (the reason being that Moore's law may well make 74-bit passwords easily crackable in 10 years or so)

For comparison, the first password you provided (16 random alphanumeric characters) has 95 bits of entropy.

[1] http://books.google.com/ngrams/graph?content=horse+in+a+box%...

> Take the first 16 characters of bcrypt(username,site domain)

Hey, that's the very definition of security through obscurity ;)

Here's a thought experiment I use when estimating security of similar password schemes: imagine you asked someone to come up with 1000 different mechanisms of generating passwords based on username and domain. Is your scheme is likely to be among them? If yes, this means it provides less than 10 bits of security.

I just checked and it's not there, I think the leak predates the comic.

> You've got to draw the line somewhere

This is the heuristics I use:

1) You can generally trust network equipment because there are many types of it, produced by many companies all over the world.

2) This means any backdoor in your computer that transmits information over the network would be trivial to detect and therefore useless for NSA et al.

With that in mind, the most dangerous backdoor that could feasibly exist is probably the one that subverts the RNG. Here is a discussion about a hypothetical backdoor in the hardware RNG built into new Intel CPUs: http://crypto.stackexchange.com/questions/9210/technical-fea...

My first thought when reading the article was to prohibit RIAA and MPAA from visiting torrent trackers etc. You can even preemptively send them a C&D letter in pretty legalese.

I agree with Steko that being case insensitive is not a big deal. If you force users to use randomly generated passwords, 12+ characters is safe whether case sensitive or not.

On the other hand, if users choose their passwords themselves... Well I made a quick script to analyze the RockYou leak of 32 million plaintext passwords:

91% of passwords are lowercase

5% are uppercase

3% are lowercase but begin with a capital letter

In other words, you can crack 99% of case sensitive passwords just by trying these 3 possibilities!

They didn't use an Android exploit specifically, they simply scanned the blockchain for vulnerable private keys. They probably didn't even know that Android was the culprit - it could be hardware wallet, a buggy homebrew client or whatever.

Even if it was technically possible[1], I don't think it's any more feasible than forcing citizens to publicly declare the serial numbers of dollar bills that they hold.

[1] By design, Bitcoin addresses are supposed to be single-use. Reusing them is a security risk and not recommended (recent android vulnerability is a good example - it only affected reused addresses). Every transaction done with the standard client usually creates a new address (to send the change), which is not even visible in the interface. Merchants accepting Bitcoin usually create a new address for each invoice, etc. etc.

In other words, the way Bitcoin is used is fundamentally incompatible with the public declaration of addresses. If the government has the power to change this, it might as well make Bitcoin completely illegal and not bother.

This is exactly what the standard bitcoin client does - it creates 100 addresses when installed.