Topic: What could cause Bitcoin to fail? (Read 5724 times)

Yeah in another post I suggested making your gold into bullets for your personal carry. :p

Maybe bullets.

Bitcoin, bullion, and bullets sounds about right.

It's also possible (since we are talking hypotheticals now) that official currencies will all fail (or become unattractive) due to inflation and over-regulation. Black market trade will then fill the void. Don't overestimate government competence. In a world with no official currency, is there anything better than gold and Bitcoin?

The key word was IF.   I believe in the potential of Bitcoin.  I wouldn't be here if I didn't and I certainly wouldn't have started a company to explore ecommerce using bitcoins if I thought it had no potential.

Still potential =/= tangible utility.  Assuming it does and thus price is supported by current utility is a fallacy.  

BRACE YOURSELF:  Bitcoin "may" never live up to that potential.  Regulatory, technical, or social issues may prevent it.  

Once again keyword is "may".  The OP was about Bitcoin failing.  I think Bitcoin failing is very unlikely but Bitcoin stagnating and becoming a niche technology with a much smaller valuation is certainly a "possibility".  Bitcoin doesn't need to fail in order for the future valuation to be much much lower.

I have yet to read this thread, but the following image is in response to the title of this thread.

Messing up the blockchain would only work for so long. All that would have to be done is the blockchain becomes 'frozen' at some point in time and then ported to a new client that plugs up the vulnerabilities. Everyone gets their coins back (or whatever coins they had at the freeze point). As for the crypto being broken, that's a whole other issue.

Folks, I cannot stress this enough. The blockchain is not going to blow up. Even if the Satoshi client blew up at some point due to scalability issues or some other reason, the blockchain isn't going anywhere. There is now $100 million in that blockchain. Those who have Bitcoins have a significant vested interest in having the blockchain survive. It will survive anything short of the cryptography itself being broken.

1) Full disclosure,  I am a site pro at SealsWithClubs.eu - the only bitcoin poker site - and I am heavily invested on Bitcoin working long term.

2)  I tell everyone that I introduce to BTC that IMO there is a 25%+ chance of total technical fail.  A list of possible ways this can go down, and of course I cannot conceive even half the reasons:

-- massive cracking of the "uncrackable" public / private key cryptography - "It's cryptography that can't be hacked!"  scares the shit out of me.  Possible solution:  massive team of dedicated, super-smart programmers on this shit 24/7 and working for good.  Need Linus Torvolds and shit.

-- massive technical fail of the blockchain - real world weed-induced 1-of-a-possible-100000 scenarios:  China starts to hate BTC b/c it frees their citizens and lets them gamble and get drugs and shit.  China likely controls a super-duper headshot botnet - likely more valuable than nukes at this point in human history - and they decide to take out Bitcoin.  They can likely get that shit done by 3pm the next week.  uber-botnet, brute force 3x the current nodes and start to corrupt the blockchain.  without much technical know-how on how the blockchain works i'll just bet theoretically china could fuck up our awesome distributed DB if they tried hard enough.  So could USA, and so could Isreal & a handful of other countries.  N. Korea has even been getting in the game recently, and seem to be good enough to fuck up a S. Korea bank recently.

-- I hope the above ramblings at least illustrate the point that there are such numerous ways this can all go boom instantly. 

I just hope those dedicated neckbeards are working for good, and working 'round the clock.  I just read somewhere this was the largest distributed software something - either largest network or largest software project.  I hope some bill gates types or warren buffets or Soros or someone comes in and tries to help legitimize us before they kill us - we need those nerds and beards and scientists and software engineers on that client and defending against the constant shots ppl are taking at it and developing the solutions for shit like "satoshi dice just made the blockchain 20% bigger" and other scalability issues we must face quickly.   Anyone got metric for how many programmers on the sourceforge project?  is it well taken care of?

Difficulty used to be 1 and there was no 51% attack.

If a drop in price makes miners drop out it will also reduce the incentive to preform the attack.

I don't think that would work for longer than a few hours as all those miners would spread out to far more pools or even move to p2p fairly quickly.

If you look at this:

https://blockchain.info/nodes-globe?series=topBlockRelay  --> nodes which fund the most blocks in the past 24 Hours

you see (with a very nice graphic :-) ) that there only about 6 servers  that need to be shut down to nearly "kill" bitcoin.

So as long solo mining or services lice p2pool are not getting a significant amount of hashpower, Bitcoin is very vulnerable.

It's interesting that when the banks fail the government steps in to prop them up.

But when Bitcoin fails it's the users that step in to prop it up.

Which has more merit?

Bitcoin already failed once and is now on it's way to renewed success. They say in life there is no such thing as failure. You just get up and keep going. I think Bitcoin now is stronger and more resilient than it has ever been. The slower it grows the more solid it's foundation.

Seems to me that the answer depends a great deal on the definitions of 'success' and 'failure', though it sounds like success to you means that you won't lose your savings.

To me the most likely cause of failure (in my definition of it) would be, paradoxically, 'success'.  I say that because I can see no other way to cope with the load but to significantly change the nature of the solution to one with has some ugly parallels to today's system of banking.  That is to say, the 'peers' are by necessity powerful and well situated entities who have the ability to exploit the users...and thus they probably will.

My fallback hope for Bitcoin is simply that I get unbelievably rich from them.  The most like 'failure' here is that Bitcoin is ignored by 'the powers that be'.  If Bitcoin is molested by said then I suspect it will both limit the solution's availability and drive the solution into hiding and hardening.  That would (I theorize) extend it's lifetime in something like the current form and the increase the value to those who find such a solution useful...and I believe there are many entities who fall into that category.

In another respect I believe that success of Bitcoin will be in demonstrating proof of concept and providing inspiration to a variety of similar solutions and I think that Bitcoin has probably already achieved this goal.  Time will tell.

if the exchanges go down... https://localbitcoins.com/

What?!?

Utility never materializes?

I refer you first to this thread:

Why we need Bitcoins for international transactions

tl;dr:


I then refer you here:

Banks to Make Customers Pay Fee for Using Debit Cards

Yes, that's right, banks were actually going to make people pay to use their own money. Money on deposit BTW which benefits the bank by fulfilling its reserve requirements. That article is old. Consumer backlash made banks back down from that ludicrous scheme. But the mere fact it was soon to be a reality reflects how broke and anti-user/pro-bank the current banking system is.

This doesn't even get into bitcoins being a guaranteed non-inflationary currency similar to gold - a fact magnified at a time now where central banks are printing cash like crazy:

ECB saves Greece from bankruptcy by securing emergency loans-paper
Fed’s Rosengren: Let’s Buy More Bonds
China's Surprise Rate Cut

It also doesn't get into the ability to use bitcoins anonymously, the ability to use them for micropayments (even fractions of pennies), the ability to store any amount of them non-physically (relevance), etc.

Utility and demand never materializes? I think not. (I say that with as little sarcasm as possible; you're probably my favorite forum poster d&t   )

It depends entirely on your own personal definition of "fail"

To most people having $5000 stolen from your computer via a hacker just once would destroy all confidence. Even though its not bitcoin itself failing, you sure wont be using it anymore.

Also what is commonly misunderstood in those articles is they researchers DIDN'T teleport a photon.  They teleported the quantum information about a photon.  It has theoretical applications in the use of cryptography.   


In theory if this somehow this could be done at great distances and the quantum information could be recorded it would provide for faster than light communication but so far that has been found to be impossible.  However despite the name quantum teleportation has absolutely nothing to do with transporting objects having mass.

Maybe someday you could use it to make an Ansible Ansible but not to have your friend Scotty "beam you up".

Well, if the exchanges want to let Bitcoin die, then they die too.

And the difference between a photon and a gold atom is probably something like the difference between throwing a baseball and throwing the Titanic... 

Actually it will mean bitcoin won't go anywhere as the internet will add quantum communications to its network, ensuring any kind of censorship will be rendered utterly useless. (Even more so than now with current technology.)

Bitcoin will go the way of the dodo bird once we can teleport gold atoms back and forth.

http://www.redorbit.com/news/science/1112534053/photons-teleported-60-miles-by-chinese-researchers/