1. It's good that Datacoin now doesn't go to 'strange' persons who want to hurt Datacoin with such 'attack'. When Datacoin big promotions start, its price should rise, and it will be really very stupid to waste money in such a way. But it is another side of 'uncensored' storage: can you offer any mechanism to avoid that and be sure that nobody from governments or corporations cannot censor information? I don't see such alternative just now.
2. We know. Cryptsy's last answer was 'we're considering about big blockchain', 2 weeks passed - still no info from them.
And btw, there is very good answer for CP on reddit
pigtrotsky:
The process of getting the data into the blockchain is effectively steganography, the hiding of one piece of data within another. The data is neither catalogued nor readily accessible - it goes through base64 encoding and needs to be addressed using a key, and is sandwiched inbetween a bunch of other blockchain data. The fact nobody really knows the full content of most blockchains in entirety owes to the complex and vast nature of the data, and this would be no different.
First question for me is why would someone bother. Not only would it cost them real money either in the mining of coin using resources and electricity or buying the coins, but now you have a picture/document/whatever embedded in a huge block chain with an effectively anonymous hash which needs to be converted back to its original format. People who currently distribute illegal material very probably already have a cheaper and more convenient mechanism available.
Arguably many people had illegal content on their hard drives when they downloaded the wikileaks insurance files for example. But without encryption keys it's just 0 and 1 data. Sure it might contain illegal content but authorities would not only have to prove it were there but that it were accessible to the user.
There has long been legal precedent in most countries that someone who handles data in a way that is "pass through" and not actual accessible content, and someone who does not make an effort to access or make that information available, is simply a carrier. People do WAY more risky stuff every day for no gain such as running tor exit nodes.
If you don't want to handle the blockchain you shouldn't have to. In terms of datacoin my interpretation of the concept of the blockchain is that those who work to compile the information in get rewarded. I know there's talk about future proof of stake but I believe that's irrelevant. Someone who wants to continue to hold the information will get rewards in the future just for adding to the blockchain through processing blocks, and given the self contained nature of the blockchain I can't see why the rest (transactions, etc) couldn't be done without holding it locally.
In fact it's an idea I am working on now - encrypt the wallet and put it into the blockchain protected by passphrase, no need for any central point of trust. I see the potential issue (one compromise and the address is forever compromised) but smarter people than I will surely find a way of beefing up the security even more, and it's still better than having my wallet sitting on someone else's server potentially unprotected as with current online wallet services.
Final final point on this - consider the motives of someone distributing illegal data. To encode illegal images for example would be incredibly stupid. Firstly, they're not anonymous - if the police were to get their private key / wallet they could absolutely and unequivocally tie that person to the distribution given the cryptographic mechanism - ie you would have just paid money to essentially have thousands of people worldwide spend CPU hours PROVING it was you who sent it. Secondly, it's now effectively immutable. You have now sent it in a way that you can't possibly delete the evidence, and therefore pretty much sealed your fate.
Anyone who does this on purpose would be incredibly stupid in my eyes.
