Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
You may want to read The End of Money, David Wolman, 240 pp, Da Capo Press, 14 February 2012 insofar as it suggests that turning your smartphone into a branch bank makes all other forms of money irrelevant. Perhaps especially digital cash. --dan ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
1. No offline transactions, which makes Bitcoin useless for a large class of transactions. On Mon, 27 Feb 2012, James A. Donald wrote: Smartphones. The implicit assumptions here, namely that * everyone who wants to make financial transactions carries a smartphone * smartphones never break down * smartphone batteries never run down * smartphones always have network connectivity don't always hold. I feel obliged to note that anyone carring an up-to-date wallet file can permit and validate transactions. If his/her wallet file is out of date double spending might occur, even then one might apply trust to still do transactions. [Another key bitcoin flaw is that it's not particularly anonymous in the face of NSA-level network surveillance. Cash *is* (remains) under these conditions.] Working on this. And the network problem. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
[Another key bitcoin flaw is that it's not particularly anonymous in the face of NSA-level network surveillance. Cash *is* (remains) under these conditions.] On 2012-02-27 10:26 PM, lodewijk andré de la porte wrote: Working on this. And the network problem. What is the plan? Seems to me that what bitcoin needs is banking layer on top of the bitcoin layer to issue chaumian coins, with bitcoins acting as gold for the banks as in free banking (with the potential for ponzis and bank failure. Of course bitcoin banks are unavoidably capable of doing a ponzi, thus one should not keep bitcoins in them for very long periods. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
Hmm... Where have I heard of that idea before... http://disattention.com/78/digital-currencies-crypto-finance-and-open-source/#ot https://github.com/FellowTraveler/Open-Transactions https://github.com/FellowTraveler/Open-Transactions/wiki/FAQ UNTRACEABLE DIGITAL CASH? … FOR REAL? Is this the real stuff? With blinded tokens? As in, invented by David Chaum? Yes, Open Transactions provides a full and working implementation of Chaumian blinded tokens. Specifically, the Wagner variant as implemented by Ben Laurie in his Lucre Project It works just fine with Bitcoins. On Mon, Feb 27, 2012 at 21:53, James A. Donald jam...@echeque.com wrote: [Another key bitcoin flaw is that it's not particularly anonymous in the face of NSA-level network surveillance. Cash *is* (remains) under these conditions.] On 2012-02-27 10:26 PM, lodewijk andré de la porte wrote: Working on this. And the network problem. What is the plan? Seems to me that what bitcoin needs is banking layer on top of the bitcoin layer to issue chaumian coins, with bitcoins acting as gold for the banks as in free banking (with the potential for ponzis and bank failure. Of course bitcoin banks are unavoidably capable of doing a ponzi, thus one should not keep bitcoins in them for very long periods. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On Sun, 26 Feb 2012 08:48:05 -0500 d...@geer.org wrote: Well put, James. Warren Buffet's arguments are, to my eye, aligned with yours. He argues that gold has no intrinsic value, unlike farmland or a company like Coca Cola. In that way, his evaluation is as instrumentalist as is yours, to the extent that I understand the both of you. His discussion of gold, per se, is getting some press. See 2011 shareholder letter www.berkshirehathaway.com/letters/2011ltr.pdf What I would add to your analysis of fiat currency is to agree that nails, moonshine liquor, and antibiotics are replacements for fiat currency, but I must also note that the modern economy is all but totally dependent on large enterprises which, because of their largeness alone, simply cannot engage in barter. It is not just about big business, it is also about maintaining a functioning government. There is too much specialization in society for courts to assign damages in terms of nails, whiskey, cattle, rice, or whatever else. How does the government assess a fine in terms of barter? Money and government go hand in hand. Governments need money in order to manage taxes, fees, fines, and so forth; yet money becomes valuable because of the legal structure that surrounds it, which is as true for gold as it is for fiat currency. Even if you could become completely self sufficient, to the point of not have to trade with anyone, you would still need to pay taxes and fees (property taxes, hunting license fees, etc.), and you will need to make those payments in a manner that is accepted by the government (i.e. the money issued by the government). Barter systems, de facto currencies and so forth only work on small scales. -- Ben -- Benjamin R Kreuter UVA Computer Science brk...@virginia.edu KK4FJZ -- If large numbers of people are interested in freedom of speech, there will be freedom of speech, even if the law forbids it; if public opinion is sluggish, inconvenient minorities will be persecuted, even if laws exist to protect them. - George Orwell signature.asc Description: PGP signature ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On Sun, 26 Feb 2012 17:57:14 +1000 James A. Donald jam...@echeque.com wrote: On 2012-02-26 1:18 AM, Benjamin Kreuter wrote: The demand for Bitcoin as a currency is driven by its properties as a digital cash system; people still need to get their nation's currency at some point Frau Eisenmenger writes in her 1919 diary: I am not denying that when governments mismanage currencies, crises and failures ensue. This is true of all things governments manage: when mistakes are made, large numbers of people wind up suffering. However, the failure of some countries' currencies does not mean that people are going to switch from their nation's currency to Bitcoin. If the US Dollar were to fail, Bitcoin would be the last thing on anyone's mind; we would probably wind up switching to some other government's currency while we sorted out the mess (Yuan perhaps), or we would just spend our time killing each other and not worrying too much about money. Perhaps you just need a short list of reasons why Bitcoin is not going to replace government issued currencies: 1. No offline transactions, which makes Bitcoin useless for a large class of transactions. 2. Fixed upper bound on the number of currency units, which creates deflationary trends as economies and populations grow. 3. No governments allow tax payments made using Bitcoin, and there is no incentive for them to do so. Even if everyone used Bitcoin for day-to-day trades, they would still have to pay property taxes or face arrests, property seizures, etc. When the government becomes too ineffective to enforce its own laws, then Bitcoin might have a chance, but only as a way to manage trade in some foreign nations' currencies (who will still want to trade with people in the region where the government failed), and that is assuming that online transactions can even happen in such a situation. Now, I will grant you this: there is a very, very, very remote possibility that every fiat currency in the entire world will fail simultaneously, and that instead of shooting each other people will continue to engage in trade (and that the Internet survives the mess). Even in that case, there will need to be some currency for offline transactions, and so even then Bitcoin will be relegated to second place. -- Ben -- Benjamin R Kreuter UVA Computer Science brk...@virginia.edu KK4FJZ -- If large numbers of people are interested in freedom of speech, there will be freedom of speech, even if the law forbids it; if public opinion is sluggish, inconvenient minorities will be persecuted, even if laws exist to protect them. - George Orwell signature.asc Description: PGP signature ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On Sun, 26 Feb 2012 11:00:15 -0500 Bill St. Clair billstcl...@gmail.com wrote: On Sun, Feb 26, 2012 at 10:08 AM, Benjamin Kreuter brk...@virginia.edu wrote: On Sun, 26 Feb 2012 08:48:05 -0500 d...@geer.org wrote: Money and government go hand in hand. Governments need money in order to manage taxes, fees, fines, and so forth; yet money becomes valuable because of the legal structure that surrounds it, which is as true for gold as it is for fiat currency. Even if you could become completely self sufficient, to the point of not have to trade with anyone, you would still need to pay taxes and fees (property taxes, hunting license fees, etc.), and you will need to make those payments in a manner that is accepted by the government (i.e. the money issued by the government). Barter systems, de facto currencies and so forth only work on small scales. You've just made a very good argument for eliminating money, at least government issued money. Yes, governments just love to assess taxes, fees, and fines. No, I have no need of any of that. I do not follow your argument -- how does eliminating government issued money stop governments from collecting taxes and fees? Governments whose currencies fail sometimes switch to the currencies issued by other governments; there are quite a few nations that use US Dollars instead of issuing their own money. You may not like the idea of fines or fees, but how would you propose courts manage disputes between people? Suppose I fail to maintain my house, and a piece of it falls off and damages your house -- should you have to pay for my negligence? If I raise cattle and you write software, what should I give you -- a cow perhaps? Perhaps I should pay for a repairman to come and fix things -- but what if you do not like the person I choose? We have judges and courts to help us resolve these sorts of disputes, and money is a great way to ease these sorts of disputes. You may disagree with the taxes you pay, the fines that are issued, and so forth -- but would you really want to have a tax collector come and rate the quality of your work, and then take the products of that work as a form of tax payment? Do you want to see people imprisoned, enslaved, tortured, etc. instead of paying fines? I also disagree with the laws in this country, but the solution is not do away with money or switch to Bitcoin. -- Ben -- Benjamin R Kreuter UVA Computer Science brk...@virginia.edu KK4FJZ -- If large numbers of people are interested in freedom of speech, there will be freedom of speech, even if the law forbids it; if public opinion is sluggish, inconvenient minorities will be persecuted, even if laws exist to protect them. - George Orwell signature.asc Description: PGP signature ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On 27/02/12 03:00 AM, Bill St. Clair wrote: You've just made a very good argument for eliminating money, at least government issued money. Yes, governments just love to assess taxes, fees, and fines. No, I have no need of any of that. Maybe, maybe not. The princes, bandits argument is not only theoretical: https://bitcointalk.org/index.php?topic=16457.0 http://ulf-m.blogspot.com.au/ iang ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
d...@geer.org wrote: Warren Buffet's arguments are, to my eye, aligned with yours. He argues that gold has no intrinsic value, unlike farmland or a company like Coca Cola. In that way, his evaluation is as instrumentalist as is yours, to the extent that I understand the both of you. His discussion of gold, per se, is getting some press. See 2011 shareholder letter www.berkshirehathaway.com/letters/2011ltr.pdf Warren Buffet writes: What motivates most gold purchasers is their belief that the ranks of the fearful will grow. Rather, what motivates most gold purchasers (and thus most bitcoin purchasers) is their belief that their fears might well prove correct, that without gold, they might find themselves penniless refugees, or, worse, without even the ability to become penniless refugees, because they lack the funding to leave a collapsing society. Gold is an end of the world investment, insurance against total institutional collapse. We tend to underestimate fat tail risks such as total collapse, since the English speaking world has never had a total institutional collapse since the battle of Hastings in 1068. This however, is survivorship bias. In the rest of the world, total institutional collapse has been rather common. Warren Buffet correctly argues that gold will, on average, lose value. However there is a significant risk that everything except gold will lose value. Warren Buffet continues: A century from now the 400 million acres of farmland will have produced staggering amounts of corn, wheat, cotton, and other crops – and will continue to produce that valuable bounty, whatever the currency may be. Exxon Mobil will probably have delivered trillions of dollars in dividends to its owners and will also hold assets worth many more trillions (and, remember, you get 16 Exxons) Now let us apply this reasoning to Russian croplands in 1903. A situation is all too easily imaginable where investing in American cropland will not get you corn, but a one way ticket to the gulag. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
See 2011 shareholder letter www.berkshirehathaway.com/letters/2011ltr.pdf Warren Buffet's argument leads to the conclusion that had Roman in the time of Caesar invested a talent in land, or deposited some money with the money lenders to earn interest, his descendents would now be worth 10^67 talents, or about one trillion trillion trillion trillion trillion trillion dollars, whereas had he buried a talent of gold in the ground, that Roman's descendents would now be worth about one talent, which is a few hundred dollars. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On 2012-02-27 1:28 AM, Benjamin Kreuter wrote: If the US Dollar were to fail, Bitcoin would be the last thing on anyone's mind; we would probably wind up switching to some other government's currency while we sorted out the mess (Yuan perhaps), or we would just spend our time killing each other and not worrying too much about money. There has never been a time when we were too busy killing each other to worry about money. Even before the bronze age there were a curiously large number of carefully made stone axe heads that were never used for chopping anything. Perhaps you just need a short list of reasons why Bitcoin is not going to replace government issued currencies: 1. No offline transactions, which makes Bitcoin useless for a large class of transactions. Smartphones. 2. Fixed upper bound on the number of currency units, which creates deflationary trends as economies and populations grow. Deflation, oh the horror, the horror. How did we ever survive during the several hundred years when deflation was normal? 3. No governments allow tax payments made using Bitcoin Oh the horror. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On 2012-02-27 1:28 AM, Benjamin Kreuter wrote: If the US Dollar were to fail, Bitcoin would be the last thing on anyone's mind; we would probably wind up switching to some other government's currency while we sorted out the mess (Yuan perhaps), or we would just spend our time killing each other and not worrying too much about money. There has never been a time when we were too busy killing each other to worry about money. Perhaps you just need a short list of reasons why Bitcoin is not going to replace government issued currencies: 1. No offline transactions, which makes Bitcoin useless for a large class of transactions. Smartphones. 2. Fixed upper bound on the number of currency units, which creates deflationary trends as economies and populations grow. Deflation! Oh the horror, the horror. How did we ever survive during the several hundred years when deflation was normal? 3. No governments allow tax payments made using Bitcoin Oh the horror. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
From: James A. Donald jam...@echeque.com Warren Buffet correctly argues that gold will, on average, lose value. However there is a significant risk that everything except gold will lose value. There is no risk that potable water or salt or (properly maintained) rifles with ammunition will lose value. Gold, however, you can't eat or drink and it's a real bitch to try to kill dinner with it. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On 2012-02-26 1:18 AM, Benjamin Kreuter wrote: The demand for Bitcoin as a currency is driven by its properties as a digital cash system; people still need to get their nation's currency at some point Frau Eisenmenger writes in her 1919 diary: http://www.wolf1168.us/misc/Articles%20of%20Interest/When%20Money%20Dies.pdf I survey my remaining 1,000-kronen notes mistrustfully, lying by the side of the pack of unredeemed food cards in the writing table drawer. Will they not perhaps share the fate of the food cards if the State fails to keep the promise made on the inscription on every note? The State still accepts its own money for the scanty provisions it offers us. The private tradesman already refuses to sell his precious wares for money and demands something of real value in exchange. The wife of a doctor whom I know recently exchanged her beautiful piano for a sack of wheat flour. I, too, have exchanged my husband's gold watch for four sacks of potatoes, ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
On 2012-02-25 12:53 PM, ianG wrote: It is also a singular lesson in the emotive power of cryptography to encourage large numbers of people to hash their intelligent thought processes. What we are seeing is otherwise rational people invest much time effort into what amounts to a ponzi or bubble or pyramid scheme. As Moldbug says, money is a bubble that never deflates. Fact is, you can buy stuff today with Bitcoin. Its value is not in that people hope that tomorrow they can exchange it for more, but that today they can exchange it for something. ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
Re: [cryptography] (off-topic) Bitcoin is a repeated lesson in cryptography applications - was endgame
Then you'll find out about Santayana's curse - those that don't study history are doomed to repeat it. For reference, start with read John MacKay, _Extraordinary Popular Delusions and the Madness of Crowds_. MacKay turns out not to be all that accurate. The definitive work on financial bubbles is Kindleberger's Manias, Panics, and Crashes: A History of Financial Crises. Get the 2005 5th edition, which was edited by Robert Solow after Kindleberger died. It's quite readable, and should help put Bitcoin in context. -- Regards, John Levine, jo...@iecc.com, Primary Perpetrator of The Internet for Dummies, Please consider the environment before reading this e-mail. http://jl.ly ___ cryptography mailing list cryptography@randombit.net http://lists.randombit.net/mailman/listinfo/cryptography
