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Bitcoin Users Reveal More Private Information Than They Realize

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Re: Bitcoin Users Reveal More Private Information Than They Realize

#61

Post by mbmott »

sievebrain wrote: post #57
kristofferR wrote: post #43

I'm weirdly ambivalent about Bitcoin privacy/anonymity. On the one hand I deeply value my privacy, and would personally love it if Bitcoin were fully anonymous. Yet - I also deeply felt intuitively that the Panama Papers exposed bad behavior. The bad behavior it exposed were people aiming to archive financial privacy. I can't really reconcile the two beliefs.

It's easy to reconcile your beliefs: "Privacy is good when it's for me, and bad when it's for other people". Privacy and anonymity in all forms can both benefit and be abused, which is why there's usually some sort of balance. Bitcoin doesn't attempt to find any balance, which is too bad.

It doesn't currently approach that balance, but there are plenty of initiatives that are in the concept stage that would go a long way.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#62

Post by ultramancool »

jackgavigan wrote: post #54
ultramancool wrote: post #3

What's next? Well, true anonymity via zero knowledge proofs of course. https://z.cash/

To anyone denouncing Zcash as "pre-mined crap" (and anyone who gives any credence to such denunciations), I recommend reading the founder's blog post on Funding, Incentives and Governance: https://z.cash/blog/funding.html

What's your point? that post basically just says yes, it's a pre-mined shitcoin but slightly disguised by being distributed over time using an algorithm.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#63

Post by ultramancool »

repomies69 wrote: post #35
aminorex wrote: post #14

Earlier quoted context omitted.

Yes. z.cash centralizes control under a corporation, which makes it vulnerable to legal process and political risk, and it is what is known in the crypto world as a "pre-mine scam".

How is it a scam if the founders are honest about it? Everyone knows the name of the game.

It's a scam in the sense that it's basically a pump and dump game for the founders. Sure, many people will know it, but those who do will probably avoid it, it's those who don't who will buy it on markets and lose out when the founders dump.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#64

Post by castis »

d0lph wrote: post #60
kristofferR wrote: post #43

I'm weirdly ambivalent about Bitcoin privacy/anonymity. On the one hand I deeply value my privacy, and would personally love it if Bitcoin were fully anonymous. Yet - I also deeply felt intuitively that the Panama Papers exposed bad behavior. The bad behavior it exposed were people aiming to archive financial privacy. I can't really reconcile the two beliefs.

Weren't they seeking to achieve tax evasion, not privacy? Physical currencies are anonymous, and they are not widely seen as unethical.

Yes, physical currencies are anonymous. However, it doesn't seem very practical to hold onto the physical currency in the amount that these guys are hiding.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#65

Post by jackgavigan »

ultramancool wrote: post #62
jackgavigan wrote: post #54

Earlier quoted context omitted.

To anyone denouncing Zcash as "pre-mined crap" (and anyone who gives any credence to such denunciations), I recommend reading the founder's blog post on Funding, Incentives and Governance: https://z.cash/blog/funding.html

What's your point? that post basically just says yes, it's a pre-mined shitcoin but slightly disguised by being distributed over time using an algorithm.

To quote Zooko himself[1]: "I don't agree that what we're doing with the Zcash Founders Reward is a premine. It's not pre! (Also it isn't mining.) But the part about it not being pre seems really important to me, because it means that anybody who can run a Zcash miner (which, I hope, will be almost anybody on the Internet) can have access to Zcash currency no later than the founders do.

"As I described on my blog post about "the Zcash Founders Reward", this seems to align incentives in everyone's best interest."

1: https://forum.bitcoin.com/ama-ask-me-anything/i-m-zooko-wilc...

Re: Bitcoin Users Reveal More Private Information Than They Realize

#66

Post by loourr »

"This also means whenever a transaction has multiple input addresses, we can safely assume those addresses belong to the same wallet."

This is not true.

You can sign partial parts of a transaction and have M of N signatures. This is what mixing services are designed to do.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#67

Post by throwaway2016a »

loourr wrote: post #66

"This also means whenever a transaction has multiple input addresses, we can safely assume those addresses belong to the same wallet." This is not true. You can sign partial parts of a transaction and have M of N signatures. This is what mixing services are designed to do.

Not to mention a great many transactions come from cloud wallets / exchanges with shared pools of addresses.

However, if you are using a QT wallet it is probably generally true.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#68

Post by gnaritas »

j15t wrote: post #47
gnaritas wrote: post #40

Earlier quoted context omitted.

Anonymous financial transactions are themselves crimes, they violate KYC laws.

KYC = Know Your Customer As the name implies, this law only applies to (financial) businesses and their customers. Most Bitcoin transactions are P2P and hence there is no business/customer relationship and hence there is no KYC law applicable.

> Most Bitcoin transactions are P2P and hence there is no business/customer relationship and hence there is no KYC law applicable.

That's a bit of a nonsense statement. It's a P2P payment network so you have no way of knowing if most of the transactions going across it are between businesses and customers or person to person. Quite simply that's a claim you can't back up.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#69

Post by gnaritas »

Karunamon wrote: post #42
gnaritas wrote: post #40

Earlier quoted context omitted.

Anonymous financial transactions are themselves crimes, they violate KYC laws.

What KYC laws? If I'm running some random business selling widgets, I'm under no obligation to do any such thing.

KYC laws apply to financial businesses, like those whose sole servers is the transfer of money, i.e. bitcoins. Exchanges for example must comply with KYC laws. Money laundering, aka mixing, is itself a purely financial service. There are no mixing services that are on steady legal ground; they are proving a service that expressly allows one to launder money as such they will always be a target for authorities.

Re: Bitcoin Users Reveal More Private Information Than They Realize

#70

Post by zooko-zcash »

ultramancool wrote: post #63
repomies69 wrote: post #35

Earlier quoted context omitted.

How is it a scam if the founders are honest about it? Everyone knows the name of the game.

It's a scam in the sense that it's basically a pump and dump game for the founders. Sure, many people will know it, but those who do will probably avoid it, it's those who don't who will buy it on markets and lose out when the founders dump.

Pump-and-dump is a major threat. Almost every cryptocurrency or related asset, including Bitcoin and Ethereum, has been vulnerable to pump-and-dump, and it is impossible to prevent.

One way to try to deter pump-and-dump is to make it so that the founders don't have any sort of privileged position, but then how could you afford to do all of the work to create a solid, usable protocol? The Zcash team (https://z.cash/team.html) is a world-class team of experts, and we all have mouths to feed during the years of our lives that we're devoting to this project.

Our solution is to trickle the Founders Reward out to the founders incrementally over the first four years, integrated with the rhythm of mining.

This militates against pump-and-dump in two ways:

1. Neither the Founders nor anybody else has a giant stash of Zcash at the beginning with which they can manipulate the market price.

2. The Founders are locked into receiving more and more Zcash over the first four years, so their incentive is for the price of Zcash to go up during that time.

In my opinion, this hack is awesome.

It affords us the opportunity to focus several years our lives on solving this important problem, which otherwise would probably go unsolved, and it offers a transparent and simple financial setup that users can evaluate for themselves if they think it is a good deal.

So I categorically reject the word "scam". There is no reasonable interpretation of the word "scam" which applies to the Zcash Founders Reward.

https://z.cash/blog/funding.html

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