Topic: Bitcoins are not, in practice, fungible - page 2. (Read 9555 times)

I'm sure everyone here is in favor of trying to find out who stole bitcoins and trying to hinder thieves from stealing again. The question is how to best do that without screwing up the system?

Tracking and tainting are two entirely different things. There will always be people who are careless with their security because they chose comfort and handability over security. They need to protect themselves better from thieves, which will get a whole lot easier when we have multi-signatures very soon.

Blacklisting coins and addresses is a futile task and will use up the already scarce resources (time, programming effort, knowledge, money) that is needed to make bitcoin more user-friendly and understandable to outsiders in order to reach widespread adoption. For a currency that is already highly volatile like BTC, without such acceptance, itself including the reliability that one bitcoin is worth one bitcoin everywhere, BTC will always remain a marginalised hacker currency.

Personally, I don't want bitcoin to be a toy for a few nerds. If I see that the community splits up and people will invent a complicated system of tracking, tainting and laundering you can go and play around with that shit yourselves.

I'm afraid if I was the Federal Reserve Bank, I would have wished for exactly (!) such an event as this theft to cause confusion, insecurity and a split-up of the community into two divisions. With a little 'luck', bitcoin will be destroyed in the process or massively hindered to grow to become a mainstream currency.

When I read about some of the self-proclaimed knights for justice on this forum I can only say please have a little more foresight and think through the midterm- and longterm consequences. We should use the time to work on some more useful applications for BTC instead.

The blockchain doesn't tell you much of anything as far as the "moral" history of a bitcoin.  I'll give you the benefit of the doubt and just assume you really haven't thought your position through very well.

Not every theft will be reported, and if "stolen" coins are treated differently, then many coins not stolen will be branded as such (remember allinvain? Did anyone ever even prove they were stolen for sure?  That was one widely publicized theft of the hundreds of thousands that have no doubt occurred).  

Who is the governing authority that makes the declaration of which coins are "dirty" or not?  What about all the other "immoral" transactions in a bitcoins history?  Who will be recording all that down so that you can devalue those coins too?  The whole thing is an exercise in futility.  At best it will be meaningless with the exception of giving you an excuse to feel morally superior.  A coin is a coin, sorry.

This is because bitcoin is not really a currency like any other. It's a cryptocurrency. All efforts to make it less like a normal currency will make the system harder to understand to new adopters, who would then be wise not to enter something they don't understand.


You do come across like a self-righteous twat.
Haven't seen anyone encouraging theft or a culture of theft.

What we don't want is an arms race between people who want their BTC anonymous and those who want to be able to pinpoint the origin of all transactions down to every person. We also don't want to have to deal with a purity measure in BTC and I don't want the risk of having BTC confiscated because of actually buying and selling in BTC.


You don't seem to understand that this comes at the total expense of centralisation and debunking yet another one of bitcoin's main tenets: anonymous money and transactions.

The obvious alternative looks a lot better to me: don't get your BTC stolen. This was perfectly feasible in the Linode case, you just keep your private keys private. I can have sympathy for Slush since he had tight margins and no capability to run operations in a different way. So let's say he had a significant pressure to run things the way he did. But Zhoutong? he was just reckless. Hope they both learnt their lesson and we can move on.


This is all about "feelings" and nothing about logic.

Again, nobody is promoting theft and "corruption" (whatever you mean with that).

If something is going to thwart growth, that is destroying anonymity of transactions and fungibility. Bitcoin has the word "coin" in it because it strives to be anonymous. You may want to rename it to bitcredit if you intend to stamp people's real names in transactions or have them give their ID on request, as if it was a credit card.

You are exactly talking like the authoritarian politicians who are in charge in my country. They use all kind of excuses trying to approve remakably unconstitutional laws. Terrorism, black market, sexual aggressions. All are excuses in order to make laws to gain control over the citizens.

Of course you are free to accept one coin or another as you are free too to chose who you are selling things to. But bear in mind that I am free to fight to whoever claim that fungibility of money is over. And I will with all the forms this awesome money offers me.

Sorry if I'm not clear because english is not my native language.

Unlike any other currency in all of human experience, a bitcoin's entire history from the time it was minted (mined) all the way until it reaches my hand, is available. Dealing in stolen property rewards the thieves who stole it, and not only hurts the person it was stolen from, but the community as a whole. Unlike others, I actually have a conscience and choose not to help promote a culture where we encourage theft of others' property.

As a community, we actually have the ability to de-incentivize theft. For the first time in history we can actually identify every piece of currency in a theft and render them valueless. Granted people will still steal for the lulz, but most steal for profit. But as a community we will not, because of greed. The hope that some of those ill gotten gains will flow through our hands, that the thieves involved in those heists will grace our businesses or buy our goods, when in reality they usually just try to cash out.

And you wonder why many in the wider world view this place as a wretched hive of scum and villany. Bitcoin: the currency of choice for thieves, drug dealers, and gun runners. Bitcoin: a ponzi scheme, a scam. All these things are said about us on the wider 'net. These perceptions are what inhibits widespread adoption. Eventually, without new blood, the Bitcoin ecosystem will grow stagnant. It is apparent that many do not care. That is their decision, of course. My personal decision is not to promote theft and corruption.

Wish I had such an old gold coin  must surely be worth more than the gold alone.

+1

"It is not up to me to determine what level of taint is/is not acceptable. That is an indvidual's choice." Very true. It may become your problem when a major exchange doesn't accept your coins though. This is my only concern. Maybe ~40000 coins are not such a big number and it will all be dilluted and go away soon to be forgotten. Once I see more threads in the forum about "MtGox froze my account and took my coins" I'd get worried though. Not for my personal risk of ever being in that position but the long-term implications for Bitcoin's reputation. I believe for it to become more than a toy for nerds, it will have to grow slowly in popularity. I doubt it will if things get too complicated or there is even a risk to lose money for obtaining tainted coins.

Because following tainted coins thru the block chain to the same pool to get laundered is oh so hard. You get away with it for a brief amount of time and then it gets noticed, especially with them there hefty fees. I remember a lot of concern in the gpumax thread when people were concerned pirate was using it for nefarious ends, however he apparently cleared all that up satisfactorily. Miners tend to be decent folk, in general, and while you will always have mercenaries that only want to get paid, let a pool start intentionally laundering stolen coins and don't be surprised if a lot of people suddenly shun it.

At the end of the day, it does not matter what you or I think should or should not be accepted by individuals. It is up to them. Every person that uses Bitcoin should have the freedom to choose whether or not they want to deal with stolen property. They should also have the freedom to choose what value they would place on coins that have a questionable history. Or any other coins for that matter. It is not up to me to determine what level of taint is/is not acceptable. That is an indvidual's choice.

Bitcoins are amoral, like all technologies, and monetary instruments.

They do not know that they are stolen or not stolen .... it is a human problem not a technology problem.

1) Miners have no clue what their hashes are being used for
2) No reason you can't pay miner in "clean coins".

Offer a 105% PPS pool.
Include a transaction the pool OP wants cleaned w/ hefty fee in the transactions (fee will go right back to the pool op).
The "tainted coins" are slowly laundered into transaction fees.
Since pool owns the input address, output address, and coinbase address the funds go right back to the pool OP.
Pay miners in clean coins from totally unrelated addresses.

Got an answer for that?  Starting to see the futility of these stupid and increasingly complex schemes to track coins.

For all you know 105% PPS pools might be doing this right now. 

Note: Miners in pools aren't paid the transaction fee.*  The pool's wallet it.  Miners are paid by pool operator.  That is a subtle but real difference.  * The exceptions being p2pool and Eligus where miners are included in the coinbase directly.

Unless you ARE the miner.

1) Create a transaction involving tainted coins w/ a hefty transaction fee.
2) Don't submit it to the network
3) Include it in the next block you are mining.
4) Tada all transaction fees are now "taint-free".

Rinse and repeat until all principal is in the form of transaction fees.

You might as well say the miner willingly supports the (insert your favorite crime here) because the transaction included in the block was payment for (insert stuff you don't like here). 

Getting miners to look for money laundering attempts is like getting auto manufacturers to avoid making getaway cars. 

How about when the choice is that or the doom of bitcoin? because that's exactly the case.

Ones that willingly support attempts at laundering stolen money

LOL. Miners will go wherever they perceive they can make the slightest bit more, all the remaining considerations be damned.

Actually, caring about the future of bitcoin I would immediately support such a mining pool even at a cost.

Honest miners   is there such a thing as a dishonest miner?

Most likely almost any business that deals in cash has at one point or another accepted payment of cash that was stolen at some point in time.  I've never heard of anyone ever griping about a business due to these practices. 

The truth is there is a good chance that tons of coins that have been stolen and never reported.  You'll never know if the coins you are receiving were once stolen or not.

As time goes on it'll be increasingly likely that most coins you encounter will at least in part have been stolen at some point, who cares?

And honest miners who want their coins kept clean willl simply not mine there anymore. Businesses that purposefully deal in stolen property should not be surprised when they have customers that no longer want to do business with them.

A big mining pool could take tainted coins and pass them to all miners with a premium, and give the newly-mined coins to a third party.