Recent Happenings in the Digital Coin World

bugs_'s picture




 

This past Monday the US Marshals auctioned off the "Silk Road" Bitcoin wallets at a higher than expected price to a single bidder.  The Bitcoin market strengthened coming into the auction and has held on to most of the price gains.

In the alternative coin market, on the other hand, we saw panic selling of an alternative coin (but only on one site!) and aggressive selling across the spectrum of "scrypt" based coins.  "scrypt" is one of the cryptographic algos that is used to validate transactions in some of the alternative coins such as Litecoin and Dogecoin.  Bitcoin uses a different algo called SHA256.

Zerohedgers know that algos are subject to attack by other algos and that the name of the game in the HFT space has been faster-faster-faster.  This is also true in the coin space.  Coins are produced by looking for rare sets of numbers that work out to be valid using the coin's algo.  This is called mining.  Initially people mined with their PC computer.  Then a faster level of mining was achieved using graphics cards.  A new level of speed arrived when special purpose ASIC integrated cicuit chips were designed to process the digital coin algos.  There are rumors of even higher speed mining using a different type of integrated circuit called an FPGA.

The faster miners are able to gain economic profits over the slower miners and dump coins on the market.  The depressed coin prices further damage the profitability of the smaller miners.

Of more concern is the pooling of this faster crypto algo power in the hands of a smaller group of high speed coin traders.  One of the vulnerabilities of a coin network is the so called "51% problem".  The coin networks operate by consensus - a transaction is valid if most of the network calculates it to be valid.  If a small group of high speed coin operators reach the 51% level they can tamper with the consensus.  This could break a coin - ruining the slower players that are holding it.

Fortunately Bitcoin seems to be actively working to prevent this.  The alternative coins, particularly the ones that use the "scrypt" algo, are much more vulnerable to the "51% problem".  I think this explains most of the price action of the past two weeks in the alternative coin market.  The market is making the transition from an abstract maybe-someone-could concern to a real maybe-someone-is concern.  Fortunately there have been nice bounces in the affected coins so perhaps the concerns are overblown.

In response new coins have been created which use a different cryptographic hashing algo that is much more difficult to implement in specialized hardware.  One of these is called x11 (an unfortunate name choice which has been in use for decades as the Unix windows software).  The hope is that x11 will inhibit the bigger faster guys from being able to kill the coin.  It is not an encouraging sign to see an x13 algo hit the streets before the x11 coins have had a chance to make it out of the nursery.

From the perspective of hindsight it seems that the choice to use the faster and simpler "scrypt" algo was a bad choice for the early alternative coins.  Bitcoin's use of the slower and more complex SHA256 algo keeps it relatively safer for longer but as always technology marches forward.  The marching is faster when money is on the line.  Satoshi's great invention was to protect the little guy from the too big to trust institutions but now we see a glimer that even Satoshi is/was only human.

Thanks Zerohedge!
Mark Hittinger
bugs_

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Mon, 07/07/2014 - 06:00 | 4931017 tradewithdave
tradewithdave's picture

"other 3rd party btc-protocol apps could prove more valuable than btc's cash value, and if that starts to kick off then btc will also rise in value as a consequnce."

What is the rationale behind this if/then statement? What are the implications if the opposite were true or if there is no correlation whatsoever? Are Swarm and Ethereum testing this hypothesis?

Mon, 07/07/2014 - 21:39 | 4934032 crazytechnician
crazytechnician's picture

You have a great web-site , I think etherium will not succeed in it's current form with a seperate blockchain because it features a hypothetical blockchain which does not currenty exist , and it's protocol layer will be modified to function over an underlying bitcoin protocol and blockchain.

Sorry for the cut & paste from above: (well worth spending a bit of time watching these vids):

from IBM:

http://www.youtube.com/watch?v=VDO7TDMlxsY

from Andreas Antonopoulos:

http://www.youtube.com/watch?v=c2CsJ2HMA2I

 

 

Mon, 07/07/2014 - 02:31 | 4930880 goldsansstandard
goldsansstandard's picture

If the low IQ folks at the end of the line work in a market paid in Bit coin they can keep their bit coins.

If the low IQ people work in a market paid in fiat , it is stolen directly with taxes, or diluted away over time with inflation, If they try to protect themselves from inflation by speculating in the market , they still get fleece in a nice legal manner.

Yes the early adopters get rich, but at least they get the fresh new money only once, as opposed to the courtiers of fiat , who keep getting new money conjured for them generation after generation.

Mon, 07/07/2014 - 00:15 | 4930751 Harriet Wanger
Harriet Wanger's picture

I'm all for digital currencies, but it seems to me that bitcoin magnificently rolls all of the unfavorable aspects of legal tender currencies into one. It also has an acrid smell of a multi-level marketing scheme. The fact that central banks and treasuries aren't putting the kibosh on bitcoin should really be sounding klaxons in peoples' heads, as they have always quashed successful alternative currencies. Individual transactions could easily be unbreakably encrypted; encrypting the entire blockchain is just a ploy to turn peoples' heads and lure them into the scheme.

Sun, 07/06/2014 - 20:28 | 4930207 tvdog
tvdog's picture

My impression of Bitcoin is that it's a risky investment, but an excellent way to transfer funds, particularly across national borders. What is needed is an easy way to convert Bitcoin to/from gold and silver. That could be the basis of a new global currency - one immune to manipulation by governments and central banks.

Sun, 07/06/2014 - 18:10 | 4929862 radiobomb
radiobomb's picture

the real point missed is that bitcoin is a protocol too, not just a store of value. and the harware supporting this protocol is now larger in T#/s than http.  other 3rd party btc-protocol apps could prove more valuable than btc's cash value, and if that starts to kick off then btc will also rise in value as a consequnce.  Alt coins do not have this aspect and are therefore not a credible challenge.  Anyone on any website is using http regardless of the tech understanding of http, and so it will be for the btc protocol with any math based app [sciences and data verification, voting, any check-sum needs, or open-source transparency, as well as the financial advantages of virtually free transfer / charity donations without using a middle-man / scalability / etc]. Other Alt coins only 'compete' as store-of-value.  so wake up folks. This is no longer up for debate because it is fact. ZH readers are wise enough to see this [I hope].

Mon, 07/07/2014 - 10:45 | 4931477 sessinpo
sessinpo's picture

radiobomb   the real point missed is that bitcoin is a protocol too, not just a store of value. and the harware supporting this protocol is now larger in T#/s than http.  other 3rd party btc-protocol apps could prove more valuable than btc's cash value, and if that starts to kick off then btc will also rise in value as a consequnce.  Alt coins do not have this aspect and are therefore not a credible challenge.  Anyone on any website is using http regardless of the tech understanding of http, and so it will be for the btc protocol with any math based app [sciences and data verification, voting, any check-sum needs, or open-source transparency, as well as the financial advantages of virtually free transfer / charity donations without using a middle-man / scalability / etc]. Other Alt coins only 'compete' as store-of-value.  so wake up folks. This is no longer up for debate because it is fact. ZH readers are wise enough to see this [I hope].

---

Bitcons by their limited availability is deflationary in nature. That was disclosed by blockchain.Thus they have to rise as long as there is demand. That is why we have these pump and dump trolls promoting bitcon. And by definition of their limited supply, they are also subject to the laws of supply and demand. As long as there is some demand, bitcons are subjectg to manipulation because of the limited supply. Pump and dump.

Mon, 07/07/2014 - 21:41 | 4933965 crazytechnician
crazytechnician's picture

By your definition - limited supply - also applies to gold. Limited supply is a positive attribute and not a negative characteristic. Do you agree then that Fiat currencies - which are by definition infinite in supply are a good thing ? Fiat currencies are a massive pump & dump , and PM's are also a massive pump & dump due to naked short selling. Bitcoin cannot be naked short sold - and in the end with a transparent blockchain will prove itself to be one of the most stablest of currency systems. Do you think the price of gold was stable just 5 years after it was discovered ?

Sun, 07/06/2014 - 18:19 | 4929887 crazytechnician
crazytechnician's picture

Bitcoins first app is currency: - but that is just it's first app:

from IBM:

http://www.youtube.com/watch?v=VDO7TDMlxsY

from Andreas Antonopoulos:

http://www.youtube.com/watch?v=c2CsJ2HMA2I

The price of Alt-Coins has now disconnected from bitcoin's price - (none of them bring anything new to the table) :

http://www.coindesk.com/litecoin-price-decouples-bitcoin-slump-continues/

 

 

Sun, 07/06/2014 - 18:43 | 4929960 Scarlett
Scarlett's picture

FPGAs are orders of magnitude SLOWER than ASICs.

 

Scrypt is orders of magnitude SLOWER AND MORE COMPLEX THAN SHA256.  

 

Not the other way around.

Sun, 07/06/2014 - 14:39 | 4929371 Clueless1
Clueless1's picture

The 51% problem?

 

You mean if I controlled 51% of BTC, I could torch my holdings as well as everyone elses?  I guess that is a flaw in the system, a big enough player could kamekazi the crypto, if they were so inclined.

 

Am I missing something here?

Mon, 07/07/2014 - 07:28 | 4931088 Global Observer
Global Observer's picture

You mean if I controlled 51% of BTC, I could torch my holdings as well as everyone elses?

No, it means if you hold 51% of mining power you can cheat for a while.

Mon, 07/07/2014 - 14:07 | 4932257 Matt
Matt's picture

Or, for example, if a mining pool controlled 60% of the mining power and then a disgruntled employee or outside hacker took control, they could abuse the system, causing a loss of faith.

 

Sun, 07/06/2014 - 17:15 | 4929726 Pickleton
Pickleton's picture

Shhhhh, you're getting in the way of the crazytech stomping his feet

Sun, 07/06/2014 - 18:46 | 4929964 Scarlett
Scarlett's picture

No, darling, you can't torch or touch anyone else's money.  You can double spend yours, for a while until people realize what's going on.  That's it.  

 

Best of luck in your future endeavors

Sun, 07/06/2014 - 14:38 | 4929369 zipit
zipit's picture

The movement in Litecoin and Dogecoin is driven by the market recognizing that cryptocurrency is a winner-take-all (or nearly) situation and Bitcoin is king.  The Internet was also a winner-take-all situation.  How many competing Internets do we have today and what is their market share?  There ya go.

Sun, 07/06/2014 - 14:00 | 4929284 SmittyinLA
SmittyinLA's picture

Bitcoin is a ponzi propped up by money laundering and illicit sales, perhaps it will outlive the dollar, sleaziest provider wins.

Sun, 07/06/2014 - 19:39 | 4929953 TheHound73
TheHound73's picture

Because gold is immune to money laundering and illicit sales.  /sarc

Sun, 07/06/2014 - 14:07 | 4929305 crazytechnician
crazytechnician's picture

Yawn.

Sun, 07/06/2014 - 13:55 | 4929271 Jano
Jano's picture

Since when is FPGA (field programmable gate array) faster, then ASIC (Application Specific Integrated Circuit)?

Asic is always 30% to 50% faster, because of the physics.

Sun, 07/06/2014 - 13:59 | 4929280 crazytechnician
crazytechnician's picture

Currently SHA256 ASIC's are atleast 100 x faster and use 100 x less power than FPGA. The author needs to do a lot more research before his / her next article.

Sun, 07/06/2014 - 11:54 | 4929004 Pemaquid
Pemaquid's picture

My motto: If you don't understand it only a fool would invest.

Sun, 07/06/2014 - 13:13 | 4929173 gdpetti
gdpetti's picture

Exactly, but there are so many fools, and so little time left to part them from their money, which needs to be converted into real assets soon before it all disappears.... same as these fools, but then such is their fate.

When is the beta testing for this iSDR set to end? Does anyone know? It's a nice distraction so far.

Sun, 07/06/2014 - 12:23 | 4929064 crazytechnician
crazytechnician's picture

Precisely - however it is unfortunate that it will be those with the lowest IQ who will get in last of all. By then all transactions will be routed over the bitcoin network so these folks won't have much choice of using bitcoin in the end anyway.

Mon, 07/07/2014 - 10:16 | 4931415 sessinpo
sessinpo's picture

crazytechnician   Precisely - however it is unfortunate that it will be those with the lowest IQ who will get in last of all. By then all transactions will be routed over the bitcoin network so these folks won't have much choice of using bitcoin in the end anyway.

----

Perfect description of a ponzi scheme. The people first to get in are the originators, then the financiers and bankers. Finally, they pawn it off to the public that get left holding the bad when the market crashes.

 

Mon, 07/07/2014 - 21:10 | 4933940 crazytechnician
crazytechnician's picture

It is not a Ponzi Scheme - that would be like saying the first people to dig out or purchase most of the easy to reach gold during the california gold rush were ponzi scam originators who palmed it off onto bagholders. That same gold is still in circulation today just like bitcoin will be in circulation in 100 years time and probably a lot longer. Of course there is the probablity of another disruptive technology emerging that will displace bitcoin just like bitcoin will disrupt todays currency. But that won't happen for the foreseeable future.

Mon, 07/07/2014 - 10:04 | 4931393 Citxmech
Citxmech's picture

If BC is a currency, who cares who gets in when?  If it's a speculative investment, that actually detracts from its suitability as a currency.

FYI - there's a big difference between "intelligence" and "education."

Mon, 07/07/2014 - 10:35 | 4931452 TheHound73
TheHound73's picture

If Gold is a currency, who cares who gets in when?  If it's a speculative investment, that actually detracts from its suitability as a currency.

Mon, 07/07/2014 - 17:11 | 4933105 Citxmech
Citxmech's picture

Absolutely correct.  While gold might be money - it's a pretty crappy currancy at the moment.  I'm guessing that's why most folks purchase physical it for it's "insurance" value, rather than for its utility for the regular exchange of goods.  

So are you arguing that BC is a speculative investment and a poor currancy?  

Mon, 07/07/2014 - 19:23 | 4933576 TheHound73
TheHound73's picture

Bitcoin is a supreme currency for transfer over the internet as long as the volatility can be managed by both parties.  As volatility decreases, utility as a currency increases.  Until saturation is reached, there will be volatility.  The saturation point will be when the bulk of economic activity that is going to take place on the bitcoin network is already taking place on the network. There are a finite number of currency units and their individual value will increase (or decrease) to support the underlying economic activity. 

Sun, 07/06/2014 - 11:09 | 4928907 CapitalistRock
CapitalistRock's picture

So the little guy is protected so long as he is always holding the crypto currency deemed technologically superior. If he is still holding yesterday's crypto currency after others have started to move to the new one then he is screwed.

Got it.

The problems discussed in this article were apparent and debated even by the early adopters. The difference today is that the problems are real instead of theoretical. The Achilles heel of all these crypto currencies is that they require that nodes connect to the Internet to validate transactions. Sadly, the Internet is not free, fair, guaranteed to carry your desired protocol, or even free of man-in-the-middle attacks by your emperial government. I think Snowden has settled the argument regarding who the Internet gatekeeper is.

Gold suffers from none of these problems. :)

Sun, 07/06/2014 - 12:16 | 4929041 crazytechnician
crazytechnician's picture

A man in the middle attack would be impossible with SHA256 unless the attacker had your private keys. If they had your private keys it would be pointless doing a man in the middle attack. The intenet protocol is TCP/IP , that is guaranteed , bitcoin runs over TCP/IP , and without the TCP/IP underlying protocol - the internet would not exist. Any modifications to TCP/IP bitcoin would run straight over. Any attempts at port blocking would result in whack-a-mole tactics , and if you have ever played whack-a-mole , the mole *always* wins.

And regarding gold , that can be found with X-Ray machines , Metal detectors , it;s heavy , bulky , difficult to transport , audit , verify it's purity and secure. Bitcoin in fact has the exact opposite attributes , it can be printed , posted ,. emailed or transferred - anywhere in the world , almost instantly - for free. Try doing that with a chunk of gold. I would agree with you if we lived in the middle ages , but we don't - we live in a digitally connected planet and the ability to transfer value over a network - that value is priceless.

Sun, 07/06/2014 - 17:22 | 4929742 Bemused Observer
Bemused Observer's picture

But I can't be denied access to my gold by someone acting remotely...what do YOU do when you have no power, or you lose internet access?
If someone wants my gold, they have to physically come here and get it. (good luck with that)
If they want your bitcoins or prevent you from using them, they can cut you off from miles away. They don't even have to get out of their pajamas or leave the house.

Sun, 07/06/2014 - 17:48 | 4929757 crazytechnician
crazytechnician's picture

Whatever , but try passing through an airport with gold , or a checkpoint , or your gold being found by drone or satellites which are now equipped with deep ground penetrating radar , sorry but even if you have it buried in the bottom of a lake it can be detected , if it can be detected it can be easily taken. Ever used a metal detector before ? Gold makes a metal detector scream like a bitch on heat. How do you detect a MicroSD card again ? Or a buried piece of paper with your keys printed out ? Or your bitcoin stored inside a online GIF or PDF using stenography ? The whole power outage / intenet outage is bunk , phones can be charged in a car or with a solar panel. And if the grid goes down proper - you will have much bigger issues to worry about than where your bitcoins or gold are stashed , you will be searching for ammo at that point. Let's hope it does not go that far .

Mon, 07/07/2014 - 06:21 | 4931037 Farqued Up
Farqued Up's picture

Searching for ammo? Pfffffttt!

Sun, 07/06/2014 - 17:57 | 4929833 Bemused Observer
Bemused Observer's picture

Gold jewelry passes through airports all the time, and no one has ever gone so far as to take the jewelry off of women's bodies. If that were to happen, then I'm afraid we've gone so far as to make lead the only PM of value.
You may be stopped for the gold bars in your luggage, but I can get through with my earrings, necklaces, bracelets, belt buckles, etc. Just have to put them in the little bin and pick 'em up on the other side of the scanner.

Sun, 07/06/2014 - 16:15 | 4929576 CapitalistRock
CapitalistRock's picture

You appear technologically astute so I will assume your Bitcoin clients do not run on any Microsoft or Apple operating systems. If they do then your private keys are already compromised. Linux is a reasonable alternative so long as you use one of the open source distributions that you compile yourself. RedHat won't cut it, although I am not aware of confirmation that it is compromised as Microsoft and Apple OSs are.

You can be certain that stopping any protocol from being forwarded over the Internet is very easy and is not done just by blocking TCP/IP ports (except for maybe with home or office network routers). Pattern matching is used to detect protocols and it is extremely hard to avoid. Even the IP addresses your computer communicates with give away the protocol you are using. No decryption is required. Encryption can keep data private under certain conditions but it cannot hide the fact that you are using a crypto currency. If your secret weapon is an expectation that you can communicate over the Internet however you please, then you will be sorely disappointed.

Your X-ray machine won't find my gold. Your audits won't take my gold. The purity is easy to verify in pure gold coins using an inexpensive Fisch or ultra sound device anyone can afford. And finally, I do not own enough tons of it yet to make it difficult to transport, nor do I care to move it somewhere anyway. The beautiful thing about gold is that it simply does not give a fuck about technology even though I earn my living developing technology. Gold is my diversification away from technology.

Good luck with your bitcoins, lite coins, thumb drive, or whatever you are hoping will hold value for decades to come.

Mon, 07/07/2014 - 12:47 | 4931919 Matt
Matt's picture

How many local businesses accept gold in your area? When you go traveling, do you take gold with you? Go on vacation in Mexico and carry a couple ounces around with you? How do you make really small purchases, do you have 1 gram units, or carry gold dust around and weigh it out to the milligram? How frequently do you purchase goods online using gold?

Sun, 07/06/2014 - 16:39 | 4929627 crazytechnician
crazytechnician's picture

More blaa. Please tell me how an ultrasound device can detect the purity of a metal.

Ever heard of VPN ? Linux ? We don't all use Windows 95 and I am sure you would be seriously shocked with how many bitcoiners were stacking PM's before you sent your first email. PM's are fantastic , but Crypto is the future , sorry about that , if you don't like it I am not sure what I can say to console you.

 

Sun, 07/06/2014 - 13:24 | 4929203 Pickleton
Pickleton's picture

Ummm, for the guy insulting other people's IQ if they don't believe in this digital coin bull shyte, apparently you think you're smarter than you really are.  

I'm really not sure why you devolved into ranting on TCP/IP other than to mask your lack of knowledge on SHA256.

First, SHA 256 s fairly easily broken in a day with GPUs (Oh wait, aren't bitcoin's primarily mined with GPUs) and number two, MIM attacks are pecisely meant to impersonate the person you gave your public key to in order to get your private key.  Here, let these guys explain it to you.

http://www.veracode.com/security/man-middle-attack

And for any faults gold may have, whether you've trumped them up or not, anything that exists in the digital world is always hackable.

 

 

Sun, 07/06/2014 - 14:05 | 4929240 crazytechnician
crazytechnician's picture

You need to re-run your numbers , SHA256 represents 2 raised to the power of 256 - this accounts for a higher number of bitcoin private keys than for all of the atoms in our entire known Universe. Bitcoin uses 2 raised to the power of 256 (this is SHA256) then cycles it again within the same 10 minute block generation time , so that is raised to the power of 256 raised to the power of 256 , every 10 minutes. It would be absolutely impossible to crack that code in 1000 billion years , let alone in the miniscule 10 minute window you have for bitcoin block generation time. I know a bit more about SHA256 than you may note thanks to 20 years of C programming and more recently some low level SHA256 encryption programming around the bitcoin protocol.

This is FACTUAL data:

Estimated quantity of atoms in our Solar System:

1,192,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

Estimated quantity of atoms in our (known) Universe:

12,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

Actual amount of possible SHA256 Bitcoin Private Keys ( 2 ^ 256) :

1,157,920,892,400,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

No technology could crack a code with that many potential private keys even if you had billions of GPU/s counting at the highest theoretical core speed of the rotations of a hydrogen electron rotating around it's nucleus in real time. Currently the fastest object in nature.

Your man in the middle argument is a Straw Man which is not only irrelevent it makes you sound like somebody with a very low IQ because you could not use a MIM attack vector on bitcoin anyway.

 

Mon, 07/07/2014 - 10:03 | 4931390 sessinpo
sessinpo's picture

 crazytechnician  You need to re-run your numbers , SHA256 represents 2 raised to the power of 256 - this accounts for a higher number of bitcoin private keys than for all of the atoms in our entire known Universe. Bitcoin uses 2 raised to the power of 256 (this is SHA256) then cycles it again within the same 10 minute block generation time , so that is raised to the power of 256 raised to the power of 256 , every 10 minutes. It would be absolutely impossible to crack that code in 1000 billion years , let alone in the miniscule 10 minute window you have for bitcoin block generation time. I know a bit more about SHA256 than you may note thanks to 20 years of C programming and more recently some low level SHA256 encryption programming around the bitcoin protocol.

This is FACTUAL data:

Estimated quantity of atoms in our Solar System:

1,192,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

Estimated quantity of atoms in our (known) Universe:

12,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

Actual amount of possible SHA256 Bitcoin Private Keys ( 2 ^ 256) :

1,157,920,892,400,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000,000

No technology could crack a code with that many potential private keys even if you had billions of GPU/s counting at the highest theoretical core speed of the rotations of a hydrogen electron rotating around it's nucleus in real time. Currently the fastest object in nature.

Your man in the middle argument is a Straw Man which is not only irrelevent it makes you sound like somebody with a very low IQ because you could not use a MIM attack vector on bitcoin anyway.

----

You need to rerun you logic. Anything subject to limited supply and high demand is subject to the law of supply and demand.  While bitcons may go up, they are subject to manipulation by one cornering the market. I'll keep it simple for you instead of large number you use to try to impress (but fail). If one peson holds a bitcon and 2 people want it, then the price can go up as high as whatever those 2 people are willing to pay. Your rant about atoms is irrelevant and silly.

 

You are crazy, but no technician.

Mon, 07/07/2014 - 21:20 | 4933982 crazytechnician
crazytechnician's picture

Did you know it is possible to split a single bitcoin between 100 million people ? Probably not , so until you understand this you are a fail.

Your punishment for this lack of knowledge is 2 cold cans of 30 years old prepper food and reading the next chaper of "How to survive when the government shuts down the AC grid and the internet - to stop bitcoin".

You are allowed to fondle your silver coins at the same time , but please do not rub any holes in them , and remember to keep the matches dry so you can light your candle.

Mon, 07/07/2014 - 08:34 | 4931187 Global Observer
Global Observer's picture

Your man in the middle argument is a Straw Man which is not only irrelevent it makes you sound like somebody with a very low IQ because you could not use a MIM attack vector on bitcoin anyway.

Insulting people and their intelligence is not going to gain any converts to bitcoin. Most articles on ZH about bitcoin are way off the mark and sometimes downright wrong. However, most people neither know the intricate mathematics involved in the secuity associated with bitcoin nor are they interested in knowing it nor should they be required to know it.

While I understand the animosity shown by PM investors to bitcoin (because most of them don't understand it), I am completely puzzled by the animosity shown by bitcoin investors to PMs. PMs have proven their ability to store wealth over long periods of time to lay public. While cryptocurrencies, bitcoin in particular, are undoubtedly the future of currency, there is not enough history for their acceptance by public at large for them to be considered good investments by lay public. Why get ruffled by those who don't understand it and hence do not want to take risks investing in it today?

Mon, 07/07/2014 - 21:04 | 4933915 crazytechnician
crazytechnician's picture

Not trying to insult anybody here , however I have spent a lot of time going into a lot of detail trying to explain this system to people and all I get back is a bagfull of shit. Good Luck to them , the ZH Flat Earth Society think the Future of Money is burying your silver in the bottom of a lake and living on prepper food and saving up lead. If that really is our future then yes , fuckit , may as well just buy PM's and dump them in some random lake.

Sun, 07/06/2014 - 17:23 | 4929712 Pickleton
Pickleton's picture

read the link, dont read the link, but self-imposed ignorance doesn't make you correct. Sorry, there's more than one way to get your private key.

Sun, 07/06/2014 - 15:38 | 4929494 OpenThePodBayDoorHAL
OpenThePodBayDoorHAL's picture

Everyone is entitled to their own opinion but we have to share the same facts. And math provides some really good facts indeed. People worried about the cracking of SHA-256 need to go back to math class.

Sun, 07/06/2014 - 17:20 | 4929716 Pickleton
Pickleton's picture

You're right about one thing for sure, you need to go back to math class.  But if you can't handle that, just try googling SHA256 being breakable.

Sun, 07/06/2014 - 17:24 | 4929743 crazytechnician
crazytechnician's picture

You are confusing password hashing using SHA256 with the way bitcoin protocol uses SHA256. An example of this would be somebody uses my_cat_is_fluffy as a password compared to an example wiki bitcoin public key say 3J98t1WpEZ73CNmQviecrnyiWrnqRhWNLy , although longer and more random , the difference in time to crack the password on a GPU running from a database of words etc would probably be a few be hours compared to hundreds of billions of years for the bitcoin public key 3J98t1WpEZ73CNmQviecrnyiWrnqRhWNLy , this is why passwords should not be made of simple words etc. if you can / cannot handle that then I am not sure what else can be said.

Sun, 07/06/2014 - 17:34 | 4929764 Pickleton
Pickleton's picture

a database of words

Jeez, for a guy that's claims how superior he is, you dont even know that's called a rainbow table?

Ok, I recommend you dump everything you own into bitcoin and hiding behind your assertion.  good luck if you think no one can get past your password..

Do NOT follow this link or you will be banned from the site!