Topic: scenarios if US Govt tried to take down bitcoin? - page 6. (Read 11904 times)

Remember that the us government (or any large government for that matter) is made up of individuals acting in their own interests, often within huge beauracracies, which then operate in their own best interests and often compete with each other for power, money, etc. 99% of these people have probably never heard of Bitcoin and don't care about much beyond a nice paycheck and getting home to watch Homeland. Even Federal Reserve employees are like this, yes I know a few.

I say this because I keep reading about "they". "They" will outlaw Bitcoin. Who is they? There is no smoke filled room with old men deciding the fate of Bitcoin. The system is huge, complex, and has grown ever dependent on itself. It is a house of cards, a lumbering dinosaur, and not nearly as nefarious as some of you think.

One thing for sure is that without the dollar they are powerless: a silent coup. That is the beauty of Bitcoin.

What would be there motivation?

You guys have realised that manopolies are impossible, inless violece is used. The government is good at that though.

They surely can take down bitcoin but that will be much like taking down Fulltilt/Pokerstars or Silkroad, public attention rises and new ones sprout.

If they really wants to take it down, it would have been done already.

My guess is they are going to regulate it now.

US Federal Judge already stated Bitcoin is a form of currency.   

Bitcoin exist in China, England and other EU countries, started to spread in the USA, Japan with each government approval one form or the other already.  Each government may have different version of regulations but so far, none of those big countries are try to shut it down.

Some example of supression but now more they are educated what it is, it will open up the door for everyone to be accepted.

Just remember when Paypal came out, everyone was saying that was bad, geek's money, you must be doing something bad if you have to use Paypal to pay someone.  Now, Paypal is another form of payment.

In addition to this, the US gov. and banksters has to take into account that this currency will continue to flourish in China, Russia, South America etc.
Trying to destroy it with external measures, like fear mongering and laws, may not be on their block at all. At this point they would probably have to ruin it technically.

it is stupid to think that governments will buy Bitcoins but just for the fun of it lets imagine that they will do, so you pay Taxes to your goverments then they proceed and buy your Bitcoins with your taxes and tax you again for the money that money that you've got from selling Bitcoin and all over again.... what a funny loop right ?

Goverment can not buy or hoard it. This will drive up the price which would be at this early stage a good commercial for bitcoin. But later the gov could dump them all which would tear down the price. This would be bad. In my opinion the goverment would(will) try first to put the name bitcoin in mud. Make it illegal to trade. Yeah, you can't forbide Bitcoin, but Bitcoin would be small for all time.

If I was the goverment I would buy or produce 51% of the mining power and try to take a few double spending which gets public. Or they hack important bitcoin providers like coinbase. Don't make it illegal! Then I would have the people against me. Put in a flaw so the people will hate it.

Another strategy would be that the gov bribe people that they say they put money into a cold storage and now the money is gone. Who would take Bitcoin still serious?

My God we are all in agreement.  Shall I ask a moderator to lock and delete the thread before the thing gets contagious???

I think this answers it:

Yeah you forgot a detail : take down Bitcoin, you have 10 others Altcoins coming. It's is infinite. Bitcoin is not just a digital currency : it is an idea. You can't stop an idea.

Well I agree with your conclusion.  The government would have made us all rich and we would be repeating the process with an altcoin so the government would be making us all rich again.  So Bitcoin is safe - no government will bother doing that. 

But if they did want to destroy Bitcoin it seems they can do so just by investing in mining kit.

yes it seems that I've been a bit ignorant, you remind me about the stupidity of some politicians, I forgot about the billions spent for endless and meaningless war, I guess you are right.

Think about that for a second.  All new Bitcoin would be produced and hoarded by the government.  The government is buying all Bitcoin so everyone does as you will do and hoards forever.  Users will move to an altcoin for gambling or drugs or remittances and Bitcoin will be a footnote in history.

Isn't that it - game over - Bitcoin dead?

I won't sell my very last bitcoin for anything less than a billion and assuming enough others are willing to do the same as myself then no government will ever be able to buy all the bitcoins.

A government will spend a few billion dollars on paperclips or prison overtime or endless wasteful projects.  The easiest way for any government to take down Bitcoin is to invest a few billion in mining kit and hoard all they produce.  They would force up the difficulty while having the ability to flood the market so other miners would be pushed out.

Or they could just buy all Bitcoin.  Again, a few billion is peanuts to a government.

at this point I cant imagine Bitcoin taking over the Fiat system, I might change my point of view when larger adoption appears or when governments make an official statement about the hole thing, but you have no idea of how governments are struggling to change their Falling fiat systems, they know the size of the mess they are dealing with but change is not that simple as we think.

many will disagree about what I will say, but I truly think that regulation is a really important thing here, which bring us back to "technical part" of an attack.

the theory of a 51% attack is possible, the motive is the question again. so lets say, to get a 51% of the network you need around $500 million  worth of equipment add to that electricity AC,internet..... that money will be worth of using only once because when you take Bitcoin down you just achieved something and you lost $500M, but again this doesnt mean the death of Bitcoin.

if you both have $50 billion, would you invest $500 million to "try" to kill a supposed threat, or wouldn't be easier to take the ride and invest and double/triple/... your money.

I understand you input here, I just want to convince my self why anyone will try to kill Bitcoin. because you know if they wanted to do it, they could do it long ago when people used to mine with CPU then GPU. which again bring another question, if governments and banks hate bitcoin, why didn't they compromise the network when it was smaller and weaker ?


 

Thanks for the answers, to diverge again as to why:  If bitcoin continues unchecked it will likely displace fiat currency to a large degree.  Fiat currency is the main power source for the entire banking industry and to a lesser degree the US Govt.  The US / European Establishment are very unlikely to stand by as a large portion of their power structure is dismantled and handed over to diffuse individuals.  You can see already with the Mt Gox account seizure, bank account closures, etc. what the govt/banks think of bitcoin - they want to destroy it.  They have already done the same with EGold, Liberty Dollar, and many others.  However, bitcoin is so widely held, popular, apparently difficult to attack, and clearly a moral good that a traceable attack, at this point, is going to be a last resort.  I'd expect to first see a continued propaganda effort and further attacks on the fiat-bitcoin interface.  This will drive bitcoin further underground and give impetus to the propaganda that it is the currency of illegal activities.  Eventually this can attempt to build public support for destroying bitcoin.  So, back to the most important questions...

mining these days is mostly centralized, you have few pools that have the most of the network hash power, p2pool is not that popular which really bothers me, so an attacker (could be US government or any one else) in has to achieve that 51% in order to start his own fork and do a big mess.

the easiest way and most efficient is to heavily DDOS the biggest pools, they say that they are DDOS protected but 100 DDOS protection is a myth, so lets say the attacker can take the biggest 3 pools (BTCguild, GHash.IO, Eligius) this is equal to 66% of the network hash rate.

so the technical aspect of the scenario is possible, but the question that popup is why ? if I have that kind of power I would just mine and make money, because such operation will cost millions of dollars, who wants to invest (lose) millions of dollars to do such thing ?

the million dollar question is what the government and big organizations think of Bitcoin ? in which position Bitcoin stands ? is bitcoin a threat for them ? will they ever regulate bitcoin ?

it is a serious matter that should be discussed but when you have the answers to these questions it will be easier to imagine the 51% attack.

I suspect that it would take the form of:

 - bio-metric based positive identification for network access.

 - real-time network utilization analysis.

 - filtering and blocking unauthorized protocols and traffic.

 - multinational carrier level embargoes against non-aligned jurisdictions.

Most people would be mainly not seriously impacted by implementation of most of these things, and all of them could be justified after the promised 'cyber 9/11' which we are assured is coming.