The best analogy for cryptocurrency is combination locks.
Imagine an anonymous public box, locked by a combination lock. This is the "address". The owner just has exclusive knowledge of correct combination("security by obscurity") but he doesn't have anything else to prove ownership.
What do you legally “own” with Bitcoin? A short introduction to krypto-property
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Re: What do you legally “own” with Bitcoin? A short introduction to krypto-property
#32The best analogy for cryptocurrency is combination locks. Imagine an anonymous public box, locked by a combination lock. This is the "address". The owner just has exclusive knowledge of correct combination("security by obscurity") but he doesn't have anything else to prove ownership.
That's not "security by obscurity". Security by obscurity is relying on keeping the working of the combination lock secret. All cryptography depends on keeping some information secret, it's just that in good cryptography what is kept secret is relatively small and well-defined (and hard to guess).
Re: What do you legally “own” with Bitcoin? A short introduction to krypto-property
#33I had to do a lot of research to understand this in a technical sense. (I haven't read the article OP linked.) I found the answer really interesting: with bitcoin, what you actually own in a technical sense is the cryptographic signature of an output of a previous transaction on the blockchain. "Owning 10 bitcoin" is intrinsically identical to "owning the cryptographic keys to a previous transaction whose value was 1…
The system doesn't really considers ownership. All participants could, individually but all, simply follow the rule (R): "this 'address' (x) actually won't spend anything, ever". Since participants are actually free to move into that rule, that x "owner" (person X) never owned btc. Person X can't say he was "disowned"/"robbed"/"stolen". Each participants is free to do whatever they want with their computers (they cou…
This is potentially semantics, but arguably 'Bitcoin' (or at least the specific bitcoin you claim to 'own') is defined by the set of rules. Thus if someone adds another rule, they are not using the same 'Bitcoin' any more. In that sense you still control it, even if everyone moves to the 'new Bitcoin', though it will now be worthless.
This does happen in practise, it is what is known as a 'fork', and things can get complicated, because generally when the rules change most people will be able to control addresses on both sides of the fork, and more confusingly, it may be possible to 'transplant' transactions from one fork to another (i.e. if you start a transfer from address A to address B on one set of the rules, anyone can also initiate the same transfer on the other set).
Another point, more specific to the example you gave, is that within the rules of bitcoin, the 'miners' who verify the transactions with a proof of work are free to choose which transactions they include. If a sufficient percentage of them choose not to include transactions from a particular address, then it becomes much slower and/or more expensive to transfer anything out of them.
Re: What do you legally “own” with Bitcoin? A short introduction to krypto-property
#34Earlier quoted context omitted.
The entire point of such a transaction is that the courts _do not_ decide it. The construction was specifically designed such that the person who figures out the hash collision is the owner. The courts having rules to decide whom the coins belong is meaningless in that context. Who owns a Barbie doll? Is it Mummy, Daddy or the child? It's not a matter for courts to decide because the question is meaningless.
Ownership is a legal concept, and thus it's up to the legal system to decide if "the person who figures out the hash collision is the owner", or if in certain cases it's not. Yes, it may be hard to enforce a judgement, especially if the other party can't be identified or located. However, if the other party is reachable, then the courts can certainly force that person to, for example, reverse the transactions, or com…
The users of a cryptocurrency are able to ignore the 'legal ownership' rules, though - they implicitly opt-in by using the system.
This is the key distinction between actually using _Bitcoin_ (i.e. running a full node and creating transactions), and using custodial Bitcoin (outsourcing it all to a third party using legal constructs).
If you're saying that the users of the cryptocurrency can't opt-out of the legal system - sure, no-one can opt out against men with guns (in practice what ends up happening is everyone hiding under pseudonyms and introducing a whole bunch of friction in an attempt to do it anyway).
I suppose my comment is intended to illustrate that this is all a sort of shell game played by non-participants.
Essentially, lawyers trying to glue themselves onto and extract consulting fees or whatever from a system which does not require them.
Repeated again for the sake of clarity - if men with guns ultimately decide transactions on the blockchain, the entire system is pointless. We can just delete it. We don't need the horrendously expensive resolution mechanism of PoW in that case, because there's already a resolution mechanism, that of men with guns.
Re: What do you legally “own” with Bitcoin? A short introduction to krypto-property
#35The best analogy for cryptocurrency is combination locks. Imagine an anonymous public box, locked by a combination lock. This is the "address". The owner just has exclusive knowledge of correct combination("security by obscurity") but he doesn't have anything else to prove ownership.
That's not "security by obscurity". Security by obscurity is relying on keeping the working of the combination lock secret. All cryptography depends on keeping some information secret, it's just that in good cryptography what is kept secret is relatively small and well-defined (and hard to guess).
Its exactly this.
All the "ownership" information is behind a secret number.
If you know/guess/steal the number you have ownership.
If you have the entire blockchain you can bruteforce checking millions of hash inputs for any matching addresses in the blockchain and empty them all of coins.
There is nothing stopping this and it will become viable as devices will be built to bruteforce random wallets or use a variant of rainbow tables to speed it up.
Re: What do you legally “own” with Bitcoin? A short introduction to krypto-property
#36Earlier quoted context omitted.
That's not "security by obscurity". Security by obscurity is relying on keeping the working of the combination lock secret. All cryptography depends on keeping some information secret, it's just that in good cryptography what is kept secret is relatively small and well-defined (and hard to guess).
Its exactly this. All the "ownership" information is behind a secret number. If you know/guess/steal the number you have ownership. If you have the entire blockchain you can bruteforce checking millions of hash inputs for any matching addresses in the blockchain and empty them all of coins. There is nothing stopping this and it will become viable as devices will be built to bruteforce random wallets or use a variant…
I think you underestimate the resources needed to do this. There is literally not enough energy or matter in the universe to enumerate all the possible wallet private keys. 'rainbow tables' are not useful here (they save you from having to do this impossible task more than once...). You can attack private keys which have not been generated properly, such that there is a sufficiently small number of candidates (broken or malicious RNG usage or deriving the private key directly from a user-created password), but a general brute-force attack on even a random well-created wallet is utterly infeasible.
Now, securing the storage of the private key is a much more difficult problem, and the fact that it is so easy to lose access to your funds (by losing the storage medium it is stored on without having backups) or have them stolen (through phishing, viruses, etc) is a legitimate criticism of bitcoin, at least for the general user who is ill-equipped to deal with a piece of data which is worth so much but both must be secret and cannot be lost.