It's been said that bitcoin is "good enough".Don't you think a significantly better coin is needed to overtake bitcoin, not a coin that only is a bit more reliable and anonymous?
I really don't see the hype around monero but I might get me some just in case
By whom? When?
Bitcoin is
not good enough. That is the problem. As a public ledger, it is good enough. For cash or SOV purposes, it is falling shorter by the day. Privacy is an essential requirement.
Bitcoin is plenty good enough. There are practical ways to achieve anonymity with bitcoin if you want to. Tumbling, mixing and swapping mechanisms can be made as secure, easy and decentralised as bitcoin its self. These methods are particularly easy and effective for moderately small sums of money like only a few thousand dollars. But transparency is the beauty of bitcoin in that it becomes harder to move very large sums of money on the blockchain anonymously.
This is a good thing! you can watch HSBC laundering money on your own desktop. With bitcoin you can have a balance between anonymity and transparency that is ideal.
The problem with BTC transparency:
Basically it comes down to 2 possible scenario's: blacklisting and whitelisting
Government could on one hand through “
whitelisting” obligate bitcoin users to identify themselves when they purchase bitcoins (this is already happening) and ask them to whom they are transferring these bitcoins (the American website Coinbase is already asking this for some transactions). In the future this could lead to a situation in which only “identified” bitcoins would be spendable at regulated payment processors (bitpay?). As a result, your anonymous bitcoins would only be spendable if you match them to your identity through a regulated authority.
A more aggressive approach is “
blacklisting”. This is a system whereby the government obligates the big mining pools (which are verifying and recording transactions in the blockchain) to not sustain certain transactions. As a result, coinjoin-transactions and transactions coming from mixers could be blacklisted whereby it would be very difficult to still perform these kind of transactions. If only a few miners process these kind of transactions, they would at least be very slow. But if the regulated pools decide to not accept blocks with mixed transactions in them, you can’t even use anonymized bitcoins! Also, other (private) miners could be incentivized to enforce the regulation, even if they are not known to the government:
if it is illigal to build on a block with a "blacklisted transaction" and if some big pools would comply, it doesn't really make sense to built on this illigal chain... If you don't comply, this big pool will not build on your chain and you will loose your reward!
edit: I expect a lot of pools to comply, because the individual miners in a pool which does not comply with blacklisting, could be considered doing "money laundering" because part of the reward they receive comes from the transaction fees!
In essence this could lead to three kinds of bitcoins:
-White bitcoins: bitcoins that satisfy the obligation of identification.
-Grey bitcoins: bitcoins that are not yet identified, but which are not actively anonymized.
-Black bitcoins: bitcoins that are banned by miners.
The consequence? Bitcoin will not be fungible anymore: you can’t just use a grey or black bitcoin to buy something from a webshop. If the government is able to discover that you possess black bitcoins or process blacklisted type transactions, you could even be seen as a someone committing a criminal offence.
Yeah so which government? all the governments? will they share personal data of their citizens? and how will these governments stop extreme deflation of clean coins.... the 'clean coin currency' will be even less stable than bitcoin as the clean coins will all get put through the same tumble machine. There will be incentive to take clean coins in exchange for 'dirty' coins as a service at a premium because to enforce such a regulation over the whole world would be impossible to do and dirty coins will continue to have value. One government will take advantage over the other to collect their cheap dirty coins and then magically clean them. The world is so much bigger than that.
just to add to that..... If you imagine the sheer amount of data there is to process if every transaction, every micro transaction, had to be officially tied to an identity and that information be validated and proof checked, it would quickly get out of hand. Bad transactions would make it through and deflate the clean coins. Its still vulnerable to false information.
Mining pools can be decentralised, its already being done. I cant imagine a situation where any single government or even many in unison can block all transactions.