Man says he lost $500,000 in virtual currency heist Leaders of the open-source virtual currency project known as Bitcoin say they have no way to verify one user's claim that hundreds of thousands of dollars worth of digital coins were plucked from his computer earlier this week. Rumors of the heist have been swirling since Monday, when a Bitcoin user named Allinvain claimed 25, …
So in your P2P utopia, speculators don't exist? Speculation doesn't exist?
This magic nerd currency has abolished all acquisitive desires?
That's brilliant, absolutely brilliant.
Please leave your number in the reply Charles, I'll see if there's a open mic spot at my pub's next Comedy Night.
And it's totally not a scheme for early adopters to hoard coins and cash out at the expense of later users... totally, yet this guy somehow has a hoard of 25,000 of them.... And if the market couldn't handle about 0.25% of the coin supply being put up for sale then the bitcoin 'economy' is clearly mostly made up of these hoarders.
Also if there's no way to show or pursue theft then somebody also f*cked up the system design.
And here, the guy can have his computer forensically examined to see if a theft took place.
If I walked into my local police station and said I'd just had £300,000 in pound coins stolen from my backpack, what do you think their response would be. I suspect the *best* I could hope for is having my statement taken.
That you might store extra cash in a separate location, such as another room, or a bank, or maybe another computer that isn't externally connected when it doesn't need to be? It's his fault he had it on a PC that became compromised, it's probably his fault he was compromised, and it's his fault for storing capital in a currency he knew couldn't be traced if stolen. If he's got any brains he should be putting his efforts into working out how the cash left his PC.
"On the other hand, carrying away $300,000 in gold, even at today's prices, will require a fair bit of work."
Not so fast...
Today's quote of gold is: $1526 (and some change)
So, $300,000 is 196.5 troy ounces.
Troy ounces are 31.1 grams (plus a bit)
A little math and this comes to 6,111g (or 6.111 kg). A bit more math and one gets 13.5 lb.
In my book, this is a bit heaver than a laptop (probably an old one) in a backpack. In my book, not much "work"!!
Of course if this were back in the 60's, when gold was $35/oz it would be a bit heaver! (40 stone heaver!!)
(paper) Cash has serial numbers. When it's stored in banks, those serial numbers are noted. If one notes the serial numbers on their own (paper) cash, then that becomes an element that could be used to trace the stolen product. Bitcoins are not like cash. They're more like your own private little language ... fascinating to build, fun to use with your friends, and absolutely ridiculous to anyone not included in the exercise.
This is a bit like gold-farming in MMORPGs, and Second Life has a virtual currency which you can convert back into US Dollars. Though Linden Lab do say that all transactions can be traced and individual Linden Dollars have serial numbers--possible, but who knows? Linden Labs are also recruiting fraud specialists.
Other virtual world operations seem to just price everything in US dollars
So what? All kinds of things, tangible or intangible, increase or decrease in value over time. Loss is typically reckoned on the value at the time, not the value at some time in the past.
Otherwise insurers would be able to get away with "Well, your coin collection might have been worth thousands at the time it was stolen, but when minted it was only worth one pound, 16 shillings and a groat."
I hold no brief for the bankers who created the current mess, but this smacks of the folks behind bitcoin wanting to have things both ways.
If I had money disapear from my account I wouldn't expect the Bank of England to be able to trace it - but the online wallet company he used should have been able to.
Probably not very smart to have kept it all in one bank - but tell that to a few local councils who thought Iceland was safe.
So what if he speculated? The money was worth what it could be exchanged for. Arguing it's worth only what he paid for it is like the BSA claims that software piracy costs billions - because every kid that pirated Photoshop would have otherwise paid retail for it.
I don't think much of Bitcoin the system but in this case it's more likely Bitcoin the client's issue.
If the Bitcoin client's wallet is just sitting there on disk with no password protection then its a serious fault of the software. If the path of the wallet is predictable e.g. %APPDATA%/Bitcoin/wallet.dat then its a serious fault of the software. APPDATA could change depending on user id but if you know the guy you're targetting you could throw in some guesses based on first / lastname combinations.
And both these things are true. Someone could use a web exploit to lift the file and initiate a transfer from from their own PC. It doesn't even need a trojan although that is possible too.
This sort of thing was fairly predictable. The Bitcoin source code has some very pretty shoddy code in it and this is one serious example. The software could be hardened in a number of transparent ways, the most obvious being to randomize the path to the wallet, e.g. %APPDATA%/bitcoin/iuoiruw128z/wallet.dat. That immediately prevents browser upload attacks.
Secondly Bitcoin should implement something akin to receivables and savings wallets. Incoming transactions go into a plaintext receivables until the user enters their savings password. At which point they move from the plaintext file into the encrypted file. The wallet closes after a timeout period, e.g. 5 minutes. So if someone lifts a wallet it'll be encrypted and therefore worthless.
I'm sure it could be improved further than that, e.g. multiple savings wallets. But the basics are simply broken at the moment. Given all the brouhaha about how secure the system is you have to wonder what other problems are lurking within it.
Digital money without the confirmation of a bank authorized payment trail will be forever vulnerable. All possible protections can be beaten by patient trojans. The gains for a thief, who has the comfort and security of working from home, are immense.
At the turn of the century there was a hype over the coming digital wallet. It crashed. The encryption cannot be kept secret. The coded transfer can be synthesized. And with a hot soldering iron a kid in his bedroom can become a multimillionaire.
The problem is its digital. Just as we can indefinitely make exact copies of our images so we, or others, can with money. Cash in a safe is analogue, it can never be exactly copied. Certainly cash can be adequately forged, so its total design and production is a race to stay ahead.
I don't understand why the banks who have their billions as magnetic orientations cannot create money. The proof of this is the failure of BCCI, an international bank that was totally crooked.
"Money" is a liability on a bank's balance sheet, so for that reason it is not in their interest to create it. The asset is the loans they hand out to people, and they are only assets to the extent they can have it paid back to them.
The likes of Maddof and Stanford created money in the way you describe, and look what happened to them.
""Money" is a liability on a bank's balance sheet, so for that reason it is not in their interest to create it."
sorry, but a basic tenant, though sometimes not easily understood .. is:
Assets + Liabilities = Capital
In the case of loans, typically today, the bank borrows from a larger bank and this is a liability that is capital, and it is then loaned as a security note that is indeed an asset .. whether it gets paid or not, or whether that security's value raises or lowers determines profit-capital gain or loss, but it is still an asset
any not "money" the bank holds is a (capital ) asset, not a liability
"I don't understand why the banks who have their billions as magnetic orientations cannot create money. "
More than 97% or so of money comes into existence based upon a believable contract by a borrower to pay it back to a lender, e.g. when you go out and buy something using a cheque overdraft or credit card, or buy a house with a mortgage. 3% or so is notes and coins, and even notes have a promise to pay in coins written on them.
Given that it is the borrowers promise which is the transferrable IOU I think it's clearer to think of the borrower as the issuer. A proportion of bank charges and interest exist to cover bank losses when the promise to repay isn't kept. Various monetary reformers insist it is the banks which create the money out of nothing in this deal, but where they are wrong is that what they call "nothing" is in fact a commitment to repay by other parties (which makes the indebted parties the monetary issuers not the banks). The concept of commitment backed money drives the conventional economy for the most part, and also works in LETS.
"the conversion rate of power consumed to bitcoin worth is still pretty terrible"
True, the Bitcoin "mining" value/power ratio is pretty lousy, in relation to many other activities.
However, from a purely economic perspective, that ratio is even worse for a lot of other computer-based activities, such as playing games, watching video, ranting in online forums [1], Everyone's Favorite Example [2], and so on.
We justify those activities, economically, by recognizing intangible (or at least difficult to calculate) benefits, typically psychological and social ones. That is, we assume that people need to be entertained, to participate in their culture, and so forth; and so expending some resources to those ends are justified.
What can someone do with Bitcoins they've mined? They can hoard them for speculative purposes - that's basically gambling, a form of entertainment. They may be able to spend them, typically on other entertainment products [3].
So ultimately the resources spent on Bitcoin mining are mostly an entertainment expense, and probably on the whole similar to other such expenses. Yes, generating hashes keeps that CPU pegged, but many of those machines would probably be running other non-productive software if they weren't trying to find Bitcoin blocks.
[1] OK, that one sometimes produces some value, in terms of education, etc.
[2] Porn.
[3] Notably illegal drugs, if media reports are to be believed.
Possibly because this kind of system is beloved of those who consider all taxation as iniquitous, something that infringes on their "liberty". These freedom-lovers frequently do not understand the difference between "liberty" and "taking liberties". I have zero sympathy for tax-evaders.
I've read the article and I cant see anywhere where it says he is anything other than a law abiding, tax paying, citizen who has been robbed (allegedly).
But wait a minute, he has some money in "bitcoins" that must make him an evil tax-evader because everybody who has money in "bitcoins" or any other virtual currency is an evil tax-evader.
you pay your bank fees, your visa card rates etc not just because they want to turn a buck (and employ people, too)* but also for insurance. you pay your 8-25% interest so that when some nobjocket honks off with your card and buys a bunch of rolexs in harrods and flogs em on ebay you can hop on the phone and not have to pay for it. likewise your bank covers you for bank robberies and things like the FDIC cover you for bank failure.
so sure, stick all your money in bitcoins**, just take out insurance on that investment, otherwise, like this dude, its just digital money under the mattress as opposed to the papery stuff, and you've nobody to blame but yourself when it goes for a walk.
*yeah, yeah. big evil credit giants, holding the little man down. I get it. money under your mattress employs zero people and doesnt work in the marketplace.
**if its decentralized, how does that even work? one big hard drive failure could have wiped out his "stash" too, right? If there's a system for transfers, then there's a transfer log. this makes my head ache.
It would be quite a pile of cash they'd have to carry, and they would have to physically come to your house.
No, this is more like having your wallet stolen by a pickpocket (Hell, it's even called a Wallet!) - it's just that no sane person would carry half a million around in their trousers.
Bitcoin is a micropayment system, it's not safe to have huge amounts of money in your virtual wallet.
you are keeping it in small bills which will be easy to carry.
And yes, I know EXACTLY how big a pile of $300,000 in cash (mostly $20 bills) is, because I'm the poor sod who once had to walk into a bank carrying a box with half that amount in it to make a deposit. Not something I planned to do, and not something I plan on ever doing again, but it isn't as large as you think it is. Although I will grant the looks on their faces was almost worth it. And I was told it would take them the whole day to count it, even though we'd done so in less than 3 hours.
I posted my views about Bitcoin in November: http://lwn.net/Comments/415118/ . However, the fact that this bubble has taken a few months to get as big as it now is doesn't mean it won't burst, and as far as I'm concerned, the sooner it bursts the better, because that means less attention will be taken from ethically based and sustainable monetary alternatives.
People who earned credits on my local LETS 18 years ago can still spend these with the 60 active participants today if they want what is on offer.
Ripple http://ripple-project.org/ is another very interesting concept, equally suited to transacting LETS credits and supermarket points as it is for paying in Pounds, Dollars and Euros, if the routing, concurrency and privacy problems are solvable. At the moment these technical problems appear difficult and intriguing, but I'm not aware of any fundamental reason why they should not be sufficiently solvable. Ripple also has the natural advantage of the IOU basis and all of the credit clearing being based upon existing trust and business relationships, and all transactions being traceable (at a pinch e.g. in the event of alleged fraud) through referral handovers within existing relationship chains, so the whole concept seems inherently reliable.
A highly publicised, non-verifiable jab at the embryonic bitcoin system on the back of a climate of recent hacking? You can't help but feel it would be in the interest of a lot of banks/governments. Even a hedge against the value of bitcoins would profit off the back of this.
Also. 4 cents now worth $20 a pop for something that has no intrinsic value? Why don't they just use virtual tulip bulbs and drop the pretense?
There has to be SOME trace ability other wise it's too dodgy to get upset about.
Honestly if it has none then this is a system used purely to break the law...otherwise why would you use it considering the risks to your money? The only thing I could think of is that you want to hide what you are buying online....Like drugs or REALLY dodgy porn...
I bet 50p this guy turns out to have illicit pictures of young children on his machine.
In Bitcoin world, as in the world of the Roman Governer of Palestine who asked that question of an alleged usurper, truth is what the powers that be claim it to be. In Bitcoin world the powers that be are those who can vote what truth is considered by the network to be, because they have more processing power than all the other players combined. Validating the next transaction block in Bitcoin is a matter of consensus, where a given number of CPU cycles == 1 vote. So it follows that in Bitcoin consensus is what BOFHs who can run programs through corporate clouds at the cost of their employers electricity bills, and Botnet herders who have more computers under their control than anyone else all at other people's expense, get to decide what the valid next block is going to be.
The whole basis of Bitcoin is that it is virtual, untraceable and unattributable. There is deliberately no trace. Its not a flaw, its a design axiom.
It not like cash, or credit cards or PayPal. Its more like barer bonds - the person with the bond has tottal title to it. If you had a bond that you bought for 10,000 and it became worth 500,000, would you keep it in full view on the table next to your open front door? Probably not. You might pt it in a safe deposit box, because that way you can keep it but still not declare it for tax. Thieves can still break in, but its harder to do.
The point here is that no-one can prove he did have the money in the first place, and no-one can show who has it now (assuming it has been stolen). That is what untraceable means.
For anyone else who does not understand this, as has been said previously, go read Cryptonomicon.
Mines the one with the barer bonds in the pocket.
This post has been deleted by its author
"Allinvain speculated the thieves made off with the windfall after using malware to compromise his Windows-based computer."
Technically savvy enough to get involved with BitCoin, but not savvy enough to run a secure OS, or apply all the sticky-plasters that are required to make Windows less sieve-like.
Speculator or enthusiastic miner, I don't really care. Blaming BitCoin (or anyone) for one's own negligence and ineptitude is a bit rich.
Miners need to run mining software to mine coins (since the CPU bitcoin client is very slow at mining) and they also need to throw their bitcoin client open as an RPC server so the miner can get work to do.
The security issue here is obvious. Miners are motivated to seek out the fastest mining software to maximize their take. It wouldn't be hard to convince some users to download and run a trojan based upon its claims of speed.
The trojan could even legitimately mine for a while to ensure good word of mouth but then go into robbery mode and transfer the lot somewhere else. This isn't hard for it to do since It has full access to the bitcoin app via RPC (and as can be seen here the commands it can call is extensive. https://en.bitcoin.it/wiki/Original_Bitcoin_client/API_Calls_list). It doesn't even need to bother with RPC if the wallet is local and could just lift it, but the RPC probably guarantees it the best chance of escaping firewalls and so on.
I am not sure that I agree with your suggestion that there is some kind of contradiction between his involvement in BitCoin and his falling for some kind of social engineering scam that led to his computer being infected. Very many soc-eng scams try to persuade that you are going to get "rich, rich, rich!" and schemes like BitCoin try to persuade you that you are going to get......."rich etc". In other words, falling for a social engineering scam directed against your pc and falling for a (ponzi, or do I mean poncy? )scheme like BitCoin has certain similarities. IE. "A fool and his pc and/or money are soon parted".
He's got himself to blame for his actual loss, but Bitcoin is undermining the trust into their system with comments like "He really just lost the amount he spent in Bitcoins, he just lost 1000$"
If you change Euros into Dollars, the Dollar rises like mad (Well, this IS hypothetical), and you end up with 10 times the original amount of money - but it gets stolen before you convert it back, you'd be a bit pissed off if the police said "You only lost the money you originally exchanged into Dollars, no worries", wouldn't you?
If Bitcoin is money, it ALWAYS has its current worth (hence the name "Currency"), not the worth it had when you got it in exchange for something else.
I am not against paying taxes, I'm proud to pay tax because I realise that tax isn't me giving my money away, but everyone pooling our money to spend on things we all need.
I use Bitcoin because I'm a saver and I don't appreciate every central bank devaluing my savings by printing money. I don't want the value of my hard earned cash to be at the mercy of the broken system where stability depends on continuous exponential economic growth.
The purpose being to keep money flowing. If money never devalues then people hoard it.
And so you get what we had here (before the theft), people hoarding masses and masses of bitcoins, but the actual volume of the bitcoin economy being so low and so unstable that this one guy could have caused the value to plummet by selling up. And he didn't even have that huge a treasure trove.
I hope you haven't sunk too much 'IRL' cash into the scheme, but if you have then... well good luck I guess. You're going to need it.
Don't you get it? Bitcoin is inherently unsafe and unregulated. It could collapse tomorrow and you could be left with nothing.
It's only an investment in the way that pyramid schemes are investments - early adopters hype the scheme to the heavens, promising untold wealth and then cash out before the scheme collapses. It's the majority who are stuck in the scheme at the end who discover the reality that it was a scam all along.
If you're so paranoid about deflation go buy some land, gold or something tangible.
Congrats... Bitcoin just devalued your money.
With his Statement Mr. Schneider made clear that whatever money you put into Bitcoin should be considered lost - if you can convert it back to real currency, lucky for you, but you're not supposed to expect anything from Bitcoin.
Your hard-earned cash is at the mercy of Bitcoin and whatever exchanges will be left by the time you want to get your money back. If Bitcoin just comes out and says "Hey, it was a nice test, but we'll just shut down everything now" you'll end up having lost all your money with nobody to appeal to.
It's money being extracted from you by force. I'm glad you're happy about paying. I'm sure if you didn't have to pay it, you'd be just as happy to pay it, too. They have places to do that. They're called charities. And they don't ask you to pay at the point of a gun.
> Only the state is big enough to guarantee a currency,
There are so many currencies that have failed over the years it would take to long to list them.
Perhaps you mean the dollar, pound and euro? Well there are no guarantees with any of them. National borrowing in all 3 currencies is way out of control and at some point the price (inflation, lots of it) will have to be paid. Or in the euro's case it might devolve back into national currencies for some of the countries involved.
Those who use a virtual currency are perhaps hoping that because it is independent of the dollar/pound/euro it will not be affected by any one currencies inflation.
Now, if I had the money to do it, I would spread it out over multiple currencies and perhaps even keep some (but not a lot) in virtual currencies.
"Only the state is big enough to guarantee a currency".
That depends upon your value of guarantee. My IOUs currently circulate within my local LETSystem , acceptable currently within a group of about 60 active participants. They are worth my help giving people lifts, the odd few hours carrying out various tasks or providing advice, second hand goods, home made jam etc. I've purchased and earned a few thousand pounds worth of similar goods and services over the last 10 years or so. It was never setup with the intention of anyone considering it a means of savings, (as opposed to exchange) but the fact remains that LETS credits earned when we started 18 years ago are still spendable with those actively participating today.
The state does have an advantage which we don't in the sense the state guarantees to accept it's own issued money as payment of taxes.
Bitcoin will be a pseudocurrency (like Air Miles, Tesco Clubcard Points and Green Shield Stamps) when it's redeemable against something useful, and people who use it have a reasonable guarantee against devaluation and theft.
You don't need the state to do that. Unfortunately, the numpties who think Bitcoin can bring down the fractional reserve banking system (cont'd p94) can't see how to get from Here to There.
I thought that, due to the requirement that all transactions must be logged to prevent someone spending the same bitcoins twice, that bitcoins were inherently traceable? And if the thief hasn't spent them yet he could transfer them first thus saving some or all of his hoard...
This post has been deleted by its author
My lad (was) into "Runescape" in a big way. He eventually decided to use a (to me) dodgy 3rd party (runescape-gold.com) where you *pay* then in £s, and they transfer so much "gold" to your characters inventory.
Because he has to learn for himself, I let him buy £30 worth. Went through with Paypal. All seemed well. He got the "gold" was happy as Larry ... next day - all his inventory had gone. I have no idea exactly how, but did note that Jagex T&Cs forbid buying gold this way, so you could hardly complain to them.
Wasn't there a court case recently where somebody sued for something in 2nd Life ?
"Don't you get it? Bitcoin is inherently unsafe and unregulated. It could collapse tomorrow and you could be left with nothing. "
No regulation is better than bad regulation. The fiat monetary system is possibly the greatest failing of the human race, and the bungled attempts at regulation would be laughable if they weren't so harrowing.
There is nothing inherently unsafe about Bitcoin, like any type of cash, its important to store it securely.
As for collapse, my analysis is that in the long run, Bitcoin is probably less likely to collapse than any other currency. For now though I have not spent what I cannot afford to lose.
"No regulation is better than bad regulation. The fiat monetary system is possibly the greatest failing of the human race, and the bungled attempts at regulation would be laughable if they weren't so harrowing."
No it isn't. Regulation stops you from being fleeced, it gives you protections from dodgy banks and lenders who would exploit you, it is borne from painful financial collapses in the past.
And you still haven't addressed why bitcoin (which is also fiat btw) a safe investment as opposed to buying land or something else which is tangible.
"There is nothing inherently unsafe about Bitcoin, like any type of cash, its important to store it securely."
Yes there is. Maybe you haven't been paying attention but some guy just got hosed by a theft. If the thieves decided to cash-in that money then everyone else's investment will slump because sellers will outstrip buyers and the price will collapse. If there are no buyers and only sellers then bitcoins are virtually worthless. And that will be just a taster of what happens when the entire sysem collapses and EVERYONE wants out.
"As for collapse, my analysis is that in the long run, Bitcoin is probably less likely to collapse than any other currency. For now though I have not spent what I cannot afford to lose."
Well your analysis appears to be clouded by some peculiar libertarian notions. Even buying gold / silver in the current speculative bubble is probably a sounder bet. Or perhaps you should even invest in some tulip bulbs. I hear they are a surefire investment too.
I am quoting your post in full - it deserves it big time!
""No regulation is better than bad regulation. The fiat monetary system is possibly the greatest failing of the human race, and the bungled attempts at regulation would be laughable if they weren't so harrowing."
No it isn't. Regulation stops you from being fleeced, it gives you protections from dodgy banks and lenders who would exploit you, it is borne from painful financial collapses in the past.
And you still haven't addressed why bitcoin (which is also fiat btw) a safe investment as opposed to buying land or something else which is tangible.
"There is nothing inherently unsafe about Bitcoin, like any type of cash, its important to store it securely."
Yes there is. Maybe you haven't been paying attention but some guy just got hosed by a theft. If the thieves decided to cash-in that money then everyone else's investment will slump because sellers will outstrip buyers and the price will collapse. If there are no buyers and only sellers then bitcoins are virtually worthless. And that will be just a taster of what happens when the entire sysem collapses and EVERYONE wants out.
"As for collapse, my analysis is that in the long run, Bitcoin is probably less likely to collapse than any other currency. For now though I have not spent what I cannot afford to lose."
Well your analysis appears to be clouded by some peculiar libertarian notions. Even buying gold / silver in the current speculative bubble is probably a sounder bet. Or perhaps you should even invest in some tulip bulbs. I hear they are a surefire investment too."
I could not have expressed it better!
:)
AF
They are in Fear mode. People are buying both because they fear the coming collapse of the existing fiat currencies. Whether or not they eventually decline is dependent entirely on removing that fear. Even then it is arguable that they will be worth more than they are today. Only reason I'm not investing in them is that I'm maxed out on the debt front and working to pay that down.
I've read many a claim on this subject, some stating Bitcoin is a currency, others bonds, ponzi scheme, scam etc.
As my posting name suggests, I know a thing or two about how money works. Let me confirm that every true currency, traded electronically, will be manage by a centralised system, usually accessed through their RTGS, Real Time Gross Settlement system, usually run by the countries/currencies central bank (Bank of England for Sterling, ECB for Euro, Fed for US Dollars etc). This way, we know how much there is, and crucially, where it is.
Cash is different matter.
Bitcoin is not currency, banks are not going to buy it are they? Mugs game with a few lucky winners at the end, a punt at best.
And besides all this boring rubbish, the name "Allinvain" just seems a bit comically suspect eh?
For me, the value of a currency breaks down when there is no meaning to the phrase 'I promise to bear the bearer on demand...", and you contemplate the system of fractional reserve banking.
At that point, suddenly it doesn't matter whether there is a state behind a given currency or not... all currency seems to be a monstrous fraud by a bank of one kind or another.
I'm not a banker, but I know a thing or two about bankers. Like Icesave. Northern Rock. RBS. Lehman. Goldman Sachs. Barings...
How much of my money do you want me to give you to compensate for the failure of your entire industry to self regulate?
Bankers, pfft.
>>"The problem with 'real' money is that the banks wants 6% of each transaction (visa, cash withdraw, bank charges X 2 for both transaction sides)."
My bank doesn't charge me anything for withdrawing cash, paying in cash or cheques, or sending or receiving electronic transfers.
They might charge me for some of those things if I was a regular business, with business-style turnover, but since a regular business seems fairly unlikely to piss about with things like bitcoins, that's a pretty moot point.
A guy gets ripped off and all a bunch of you have to say is that he's an idiot for having Bitcoins. That's pretty pathetic. It is not the victim's fault. Nor is it Bitcoin's. The system does exactly what it is meant to. The merits and flaws of an untrackable currency are beside the point. Too many of you are playing the 'blame the victim' game. Do you blame the victims of identity theft when a trojan lifts enough personal details from their computer for someone to get a credit card? I would hope not. This is the same thing.
"Do you blame the victims of identity theft when a trojan lifts enough personal details from their computer for someone to get a credit card? I would hope not. This is the same thing."
The same thing, with a notable exception.
As has been mentioned, the attractiveness of the system is that there are no fees to pay, greedy bankers to finance and so on. However, that is also the flaw.
Recently I was unlucky enough to have my details stolen, £200 near enough went from my account without my say so. If this had been bitcoin, it looks like that would have been the last I saw of it. As it was, I phoned my bank who immediately cancelled my card and issued a new one, began an investigation in to the fraudulent transaction, and credited my account with £200 right there, pending the outcome. They found in my favour, so I kept the money.
As with everything, there is opportunity and there is risk. If you take the opportunity bitcon, sorry, bitcoin represents, you must accept the risk of dealing in untraceable money. I choose to not take that opportunity, however I have much lower risk. He chose to take the opportunity, unfortunately, he is now the victim of the inherent increased risk.
'Regulation stops you from being fleeced, it gives you protections from dodgy banks and lenders who would exploit you, it is borne from painful financial collapses in the past'
Sorry, but what faraway planet are you from? Surely you meant: 'Regulation that should stop you from being fleeced, to give you protection from dodgy banks and lenders who exploit you, this being learnt from the current painful financial collapses"
I don't recall losing my savings once during any financial crisis in my lifetime. Perhaps that is because I don't invest in ostrich eggs or some other harebrained get rich quick scheme. Perhaps it also has to do with the fact that banks are regulated which curbs their worst excesses and provides a measure of financial safety if they do come crashing down. When Northern Rock came crashing down, the government stepped in with a savings guarantee and nationalised the bank to stabilize it. Without regulation no such measures would have happened it might have had a domino effect on other banks. The fact of the matter is Bitcoin is a blackhole.
If and when it collapses or is legislated out of meaningful existence you know who will save your ass? Nobody. Your money will be toast. Or rather it will be in the pockets of speculators who got out before the pyramid collapsed.
And presumably you also live in a country with a nice stable government with a willingness and the borrowing ability to bail out banks.
If you had your money in Iranian Rials with the Shah's head on them, Rhodesian pounds, or Zimbabwean dollars you might not have been so lucky.
Even the Reichmark, backed by all the power of the National Socailist Government didn't do too well.
Whether or not the theft actually took place - and I am sceptical - this story is good news for the burgeoning currency, whose inherent strength is its ability to facilitate trade. Not really as a vehicle of asset speculation.
As a result of hearing this, more people may be reluctant to hold large quantities and may be apt to spend or trade the coin rather than holding out for appreciation. For a deflationary currency like Bitcoin, such behaviour could be just what the doctor ordered.
Personally if I found the contents of my coat pocket gaining hundreds of thousands of pounds in value I would start moving at least some of it into a safe but I guess Allinvain doesn't see things that way.
Still, if he knew someone who would've bought the things then I feel bad for him for losing them. I'm not a monster, unlike some people it seems.
There's a reason why *real* money exists... if we want to talk about the virtues of Bitcoin, let's then proceed to talk about the virtues of Monopoly game money. After all, it would seem infinitely more valuable in this case with so few people trying to steal it using malware.
The Register 
Biting the hand that feeds IT
Copyright. All rights reserved © 1998–2025
