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Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Disconnect a country from the Internet (

Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Disconnect a country from the Internet (or filter the traffic) and you're forking the chain. Spend on both networks by buying other (unfiltered) crypto. There are states (even large ISPs) that can do that. Also, the first thing to go in case of global conflict is the global Internet. Countries will try to damage opponent's internet links to gain strategic advantage. Crypto currencies will be useless in this case, losing all of their value. There's always the concern of a bug in the protocol, a solution to the hash function or plain old human stupidity that can crash the currency. I guess my point is: be careful, this is still very much experimental, don't invest everything you have in them.

hamilyon2 9y ago
Fork wold decrease number of miners working on the main chain. Thus destroy some value, and bitcoin price may be more volatile in days of fork. But no more than that. I cannot imagine any exchange/buyer accepting transactions from anything but the longest chain, and existence of the longest chain cannot be kept secret in modern world.
- prostoalex 9y ago
  Ethereum Classic and Bitcoin Cash are still traded on exchanges.
VikingCoder 9y ago
"Crypto currencies will be useless in this case, losing all of their value." Pedantic nitpick - there are crytpocurrencies which are not distributed proof-of-work blockchains, and would not necessarily lose all of their value.
- granda 9y ago
  Can you go into more detail?
  - VikingCoder 9y ago
    Maybe I'm just talking about digital currencies in general, I guess...
ballenf 9y ago
The fork concern is real, but the double-spend on both forks is less so. It would require the double-spender to have access to both networks. Which isn't that hard to see. But, it wouldn't take too many parties having access to both networks to prevent the fork in the first place. The miners who control such things are very highly incentivized to keep their operation on the main or largest fork. The alternative for the miners would be doing work on a fork that has the distinct risk of being worthless as soon as the network issues resolve. There are very distinct risks. But ones that have "real world" parallels. Think bars of gold becoming less valuable than antibiotics now worth pennies. Or Marlboros. In the shit-hits-the-fan scenario, values of everything goes crazy not just cryptocurrencies. $1000 smartphones without electricity or networks become paperweights.
- chinathrow 9y ago
  > The fork concern is real, but the double-spend on both forks is less so. It would require the double-spender to have access to both networks. Which isn't that hard to see. Not hard at all. Have a second uplink to the world wide net, e.g. via sat.
  - ballenf 9y ago
    Which is my point: if an interconnect is possible, miners are going to have a very high incentive to use it as well. Not just double-spenders. And it wouldn't take many miners doing it to prevent the fork in the first place.
  - Taek 9y ago
    Thing is, as long as there is one honest person with a connection to both networks, they can easily serve as a relay between them, and keep both networks fully synchronized. If an attacker is on both networks and trying to double-spend, it's extremely likely that someone honest is also on both networks who is successfully keeping the two networks fully synchronized. In this type of situation, you can make yourself safe just by waiting for 4-6 confirmations instead of the usual 0-2 confirmations.
nullc 9y ago
> Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Disconnect a country from the Internet (or filter the traffic) and you're forking the chain. Less so than in the past: https://blockstream.com/satellite/menu/ https://blockstream.com/satellite/menu/ > I guess my point is: be careful, this is still very much experimental, don't invest everything you have in them. Well, that much is obvious.
- simias 9y ago
  Having satellites broadcasting the blockchain is a good step to make the network resilient but it doesn't prevent governments messing with miners. A great disturbance would occur should china decide to unilaterally shutdown the miners on its territory for instance. Furthermore unless I'm missing something these satellites broadcast the blockchain but don't relay new transactions. That means that if I'm stuck in some place without internet access I can use the satellite network to keep my copy of the blockchain up to date but I still can't make new transactions, effectively making it useless. I guess they could expand their services to allow for satellite transaction relay but that sounds very expensive.
  - kristineberth 9y ago
    > Disconnect a country from the Internet (or filter the traffic) and you're forking the chain. Is this necessarily true? Forgive my ignorance but if we're talking Bitcoin, wouldn't the rest of the remaining miners around the world be able to account for this? And would the situation be meaningfully different in the country in question were China (or another of similar size/mining power)?
    - simias 9y ago
      I think you're replying to the wrong comment but to try and answer your question if a region is completely isolated from the rest of the bitcoin network one of two things can happen: - If the region doesn't have a significant hash power (the case in most places in the world really) then the block rate will effectively go to zero, meaning that bitcoin will effectively "pause" here and be unusable until fresh blocks can be retrieved from the outside and new transactions broadcasted to the external miners. - If the region has enough hash power to mine new blocks regularly the region will fork its chain. If it has more than 50% of the global hash rate this new chain will be the "real" one and will take over as soon as it's reunited with the rest of the network (invalidating the "outside" blockchain and all its transactions since the fork). If it has less than 50% hashrate then the opposite happens, as soon as the longer outside chain is received it'll invalidate the fork. In both these situations bitcoin is effectively unusable in the minority fork since you know for a fact that the chain will be erased as soon as the network is reunited.
gldalmaso 9y ago
I think you have a valid point, but, ultimately aren't all or most trades digital today? Are countries exchanging actual loads of gold and/or cash around? If the answer is no, then isn't it all just data on a hard-drive? In that case damaging internet links will have the same effect all around, though information can probably still go in/out in different ways with some effort. Is there some aspect of crypto currency that makes it different (honest question)?
- simias 9y ago
  The difference IMO is that gold has intrinsic value by virtue of being rare and shiny. I guess the idea is that even if civilization collapses and we return to the stone age gold will still be valuable. Since the use of gold as currency can be traced back at least to 600BCE[1] there's a good reason to believe that. Bitcoins however doesn't really have a intrinsic "rest" value. Anybody can (and many do) spawn a new blockchain out of thin air. Ironically Bitcoin is entirely about trust at the core. The trust that the other participants in the bitcoin economy won't lose faith in the currency and dump it. That trust is the only thing that gives the coin value. [1] http://rg.ancients.info/lion/article.html http://rg.ancients.info/lion/article.html
  - lostmsu 9y ago
    If you can carry gold to another country, nothing will stop you from bringing a USB flash with new, longer Bitcoin blockchain, which includes your transaction to send BTC to the receiver.
    - prostoalex 9y ago
      That's after you convince the rest of the operating nodes in that country that the blockchain version on your USB is indeed the greatest, and everyone should just migrate to that.
  - acdha 9y ago
    Similarly, national currencies have a value because governments collect taxes and pay for things using those currencies so there's a considerable inertial force encouraging their usage. That doesn't mean that failure is impossible but it smooths out a lot of minor fluctuations whereas, as you pointed out, if a Bitcoin competitor took off tomorrow there's no pressure not to adopt it instead other than the sunk costs which a small percentage of the general population has.
smokeyj 9y ago
Bitcoin is global. If you want to be sure your transaction is on the longest chain you can just wait for more confirmations. You could even receive confirmations over satellite now. > I guess my point is: be careful, this is still very much experimental, don't invest everything you have in them. Also experimental: Central banking and fiat currency. The lifetime of these non-crypto backed coins isn't that great either. Also they tend to be devalued in times of war. Not sure I'd want to be holding onto paper money.
- Double_a_92 9y ago
  > Also they tend to be devalued in times of war. Yeah, a currency that strongly depends on a stable and free internet is much better in times of war. /s
  - smokeyj 9y ago
    Diversifying a portion of your mattress money into digital money isn't the worst idea. It's a hedge against hyperinflation that can be transported digitally.
elevensies 9y ago
This is something I've been wondering about. Maybe someone with more bitcoin expertise could answer. Is there more mining capacity inside China than outside China? If so, and the Chinese government used their well-known firewall against Bitcoin for a matter of days to weeks, would Chinese miners have the longer chain? And thus the chain? I guess what I'm wondering is if the government of China has the ability to DOS Bitcoin as a payment system outside China at will.
- prostoalex 9y ago
  The attack you're describing is analogous to 50%+1 attack. The chain will fork, and after Bitcoin + Bitcoin Cash and Ethereum Classic + Ethereum it's reasonable to assume both versions will co-exist to some degree.
  - elevensies 9y ago
    Yeah, I think that is the right way to think about it. I had always considered that in terms of mining power, not in term s of network control, but it is effectively the same incentives and consequences, just with different players.
- cgore 9y ago
  My guess is that the Chinese miners are often well-connected in the middle-levels of the Chinese government, the parts that actually implement such policies, and only a few less-connected miners would actually get blocked, thus increasing the profitability of the miners with government connections.
  - contingencies 9y ago
    AFAIK mining doesn't actually require connectivity until you want to reveal the block. It's unlikely anyone else will discover it quickly, so you can just have someone walk across a border (or get on a flight) and plug it in to the global network from elsewhere.
    - 9y ago
kbody 9y ago
I'll focus on one thing that's fitting and haven't been mentioned. It's about Opendime ( https://opendime.com/ https://opendime.com/ ) which brands itself as a Bitcoin credit stick. It's like a USB stick but it stores inside a Bitcoin private key that's not revealed to the user unless they visibly break a part of the stick. This basically allows you to "load" bitcoins on the stick and give to others while being relatively certain of the "transaction" while of course being offline. I assume it's probably possible in theory that with an electronic microscope or something similar a skilled engineer will be able to read that private key, but I haven't read of any reports that it has happened yet, but it all depends on the value contained to make it worth the effort and even then we won't know. This basically allows off-chain & off-internet transacting which is really cool and enables the use in some more cases. Personally I know that Bitcoin is not perfect, it has strengths and weaknesses but it's good enough for a lot of use-cases at the moment and it will keep getting better. There are quite a lot of talented engineers & cryptographers actively working on Bitcoin and cryptocurrencies that will move things forward quite a lot. Unlike Gold, Bitcoin can be upgraded to do more thing and evolve, be it Bitcoin or some other cryptocurrency, unless we live on an age of having govs ban a technology it will find its place on our daily lives.
- cesarb 9y ago
  So, it's a real life version of Shadowrun's Credsticks? (http://shadowrun.wikia.com/wiki/Credstick http://shadowrun.wikia.com/wiki/Credstick)
  - kbody 9y ago
    Indeed, iirc that was the idea/inspiration.
decentralised 9y ago
> a well functioning internet infrastructure Not that much. Most refugee camps have cell coverage and people there use btc as it's the only money they have access to.
- decentralised 9y ago
  Apparently it's not a good idea to point out that bitcoin not only survives, but thrives under harsh conditions here on HN.
  - decentralised 9y ago
    lol And there's a satellite too now, so +1 resilience for Bitcoin! https://www.blockstream.com/satellite/ https://www.blockstream.com/satellite/
Taek 9y ago
> Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Amazingly, not really. Bitcoin is a currency that's built to be disaster-proof, including world-ending scenarios like nuclear war between superpowers. You really just need 3 things: 1. A computer that can validate the chain. 2. The longest chain. This can be given to you via usb stick if the Internet is down. 3. Some way to send and receive blocks and transactions as the network continues building the longest chain. A lot of work has gone into being able to achieve number 3 without full internet infrastructure. The example of a satellite beaming blocks to the world has already been brought up (though this is receive only, not send-capable for most people). However, people have also written software that can transmit blocks over HAM radio. You can't download the full blockchain over HAM relay, but you can relay blocks and transactions in real time, because the whole network is bottlenecked to about 2 MB per 10 minutes. If you have wifi routers, you can set up point-to-point relay and broadcast systems as well. A point-to-point system can get well over 100 miles per hop. If the Interent were to suddenly fail, it may take a few weeks to connect everything together, but you could get Bitcoin up and running long before you could get anything like email working again. > There are states (even large ISPs) that can do that. While there are states that can split you from the main Internet, all you need is one relay that the state can't control to keep the Bitcoin network connected. It's not like a website where people have to keep asking a central server for data - once one person has relayed a block into an isolated network, the whole isolated network has that block. You can't keep the network isolated unless it's perfectly isolated, and on the scale of a country you are of course going to have people listening to the satellite broadcasts, setting up wifi relay points, or maybe even doing something less sophisticated like usb-smuggling which means it effectively takes a few days to be certain that a transaction has been confirmed by the broader network. ---------- TL;DR: Bitcoin is far more resilient than you give it credit, and it can survive the Internet going down. As long as you still have an ad-hoc way to transmit blocks to major areas, you can keep everyone fully in consensus. The infrastructure requirements of Bitcoin are far less than that of email, sms, or traditional website based, centralized infrastructure.
- prostoalex 9y ago
  > This can be given to you via usb stick if the Internet is down. What's the verification mechanism if you're given two or three USB sticks all swearing they have the latest and greatest blockchain?

hamilyon2 9y ago

Fork wold decrease number of miners working on the main chain. Thus destroy some value, and bitcoin price may be more volatile in days of fork. But no more than that. I cannot imagine any exchange/buyer accepting transactions from anything but the longest chain, and existence of the longest chain cannot be kept secret in modern world.

prostoalex 9y ago
Ethereum Classic and Bitcoin Cash are still traded on exchanges.

VikingCoder 9y ago

"Crypto currencies will be useless in this case, losing all of their value." Pedantic nitpick - there are crytpocurrencies which are not distributed proof-of-work blockchains, and would not necessarily lose all of their value.

granda 9y ago
Can you go into more detail?
- VikingCoder 9y ago
  Maybe I'm just talking about digital currencies in general, I guess...

ballenf 9y ago

The fork concern is real, but the double-spend on both forks is less so. It would require the double-spender to have access to both networks. Which isn't that hard to see. But, it wouldn't take too many parties having access to both networks to prevent the fork in the first place. The miners who control such things are very highly incentivized to keep their operation on the main or largest fork. The alternative for the miners would be doing work on a fork that has the distinct risk of being worthless as soon as the network issues resolve. There are very distinct risks. But ones that have "real world" parallels. Think bars of gold becoming less valuable than antibiotics now worth pennies. Or Marlboros. In the shit-hits-the-fan scenario, values of everything goes crazy not just cryptocurrencies. $1000 smartphones without electricity or networks become paperweights.

chinathrow 9y ago
> The fork concern is real, but the double-spend on both forks is less so. It would require the double-spender to have access to both networks. Which isn't that hard to see. Not hard at all. Have a second uplink to the world wide net, e.g. via sat.
- ballenf 9y ago
  Which is my point: if an interconnect is possible, miners are going to have a very high incentive to use it as well. Not just double-spenders. And it wouldn't take many miners doing it to prevent the fork in the first place.
- Taek 9y ago
  Thing is, as long as there is one honest person with a connection to both networks, they can easily serve as a relay between them, and keep both networks fully synchronized. If an attacker is on both networks and trying to double-spend, it's extremely likely that someone honest is also on both networks who is successfully keeping the two networks fully synchronized. In this type of situation, you can make yourself safe just by waiting for 4-6 confirmations instead of the usual 0-2 confirmations.

nullc 9y ago

> Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Disconnect a country from the Internet (or filter the traffic) and you're forking the chain. Less so than in the past: https://blockstream.com/satellite/menu/ https://blockstream.com/satellite/menu/ > I guess my point is: be careful, this is still very much experimental, don't invest everything you have in them. Well, that much is obvious.

simias 9y ago
Having satellites broadcasting the blockchain is a good step to make the network resilient but it doesn't prevent governments messing with miners. A great disturbance would occur should china decide to unilaterally shutdown the miners on its territory for instance. Furthermore unless I'm missing something these satellites broadcast the blockchain but don't relay new transactions. That means that if I'm stuck in some place without internet access I can use the satellite network to keep my copy of the blockchain up to date but I still can't make new transactions, effectively making it useless. I guess they could expand their services to allow for satellite transaction relay but that sounds very expensive.
- kristineberth 9y ago
  > Disconnect a country from the Internet (or filter the traffic) and you're forking the chain. Is this necessarily true? Forgive my ignorance but if we're talking Bitcoin, wouldn't the rest of the remaining miners around the world be able to account for this? And would the situation be meaningfully different in the country in question were China (or another of similar size/mining power)?
  - simias 9y ago
    I think you're replying to the wrong comment but to try and answer your question if a region is completely isolated from the rest of the bitcoin network one of two things can happen: - If the region doesn't have a significant hash power (the case in most places in the world really) then the block rate will effectively go to zero, meaning that bitcoin will effectively "pause" here and be unusable until fresh blocks can be retrieved from the outside and new transactions broadcasted to the external miners. - If the region has enough hash power to mine new blocks regularly the region will fork its chain. If it has more than 50% of the global hash rate this new chain will be the "real" one and will take over as soon as it's reunited with the rest of the network (invalidating the "outside" blockchain and all its transactions since the fork). If it has less than 50% hashrate then the opposite happens, as soon as the longer outside chain is received it'll invalidate the fork. In both these situations bitcoin is effectively unusable in the minority fork since you know for a fact that the chain will be erased as soon as the network is reunited.

gldalmaso 9y ago

I think you have a valid point, but, ultimately aren't all or most trades digital today? Are countries exchanging actual loads of gold and/or cash around? If the answer is no, then isn't it all just data on a hard-drive? In that case damaging internet links will have the same effect all around, though information can probably still go in/out in different ways with some effort. Is there some aspect of crypto currency that makes it different (honest question)?

simias 9y ago
The difference IMO is that gold has intrinsic value by virtue of being rare and shiny. I guess the idea is that even if civilization collapses and we return to the stone age gold will still be valuable. Since the use of gold as currency can be traced back at least to 600BCE[1] there's a good reason to believe that. Bitcoins however doesn't really have a intrinsic "rest" value. Anybody can (and many do) spawn a new blockchain out of thin air. Ironically Bitcoin is entirely about trust at the core. The trust that the other participants in the bitcoin economy won't lose faith in the currency and dump it. That trust is the only thing that gives the coin value. [1] http://rg.ancients.info/lion/article.html http://rg.ancients.info/lion/article.html
- lostmsu 9y ago
  If you can carry gold to another country, nothing will stop you from bringing a USB flash with new, longer Bitcoin blockchain, which includes your transaction to send BTC to the receiver.
  - prostoalex 9y ago
    That's after you convince the rest of the operating nodes in that country that the blockchain version on your USB is indeed the greatest, and everyone should just migrate to that.
- acdha 9y ago
  Similarly, national currencies have a value because governments collect taxes and pay for things using those currencies so there's a considerable inertial force encouraging their usage. That doesn't mean that failure is impossible but it smooths out a lot of minor fluctuations whereas, as you pointed out, if a Bitcoin competitor took off tomorrow there's no pressure not to adopt it instead other than the sunk costs which a small percentage of the general population has.

smokeyj 9y ago

Bitcoin is global. If you want to be sure your transaction is on the longest chain you can just wait for more confirmations. You could even receive confirmations over satellite now. > I guess my point is: be careful, this is still very much experimental, don't invest everything you have in them. Also experimental: Central banking and fiat currency. The lifetime of these non-crypto backed coins isn't that great either. Also they tend to be devalued in times of war. Not sure I'd want to be holding onto paper money.

Double_a_92 9y ago
> Also they tend to be devalued in times of war. Yeah, a currency that strongly depends on a stable and free internet is much better in times of war. /s
- smokeyj 9y ago
  Diversifying a portion of your mattress money into digital money isn't the worst idea. It's a hedge against hyperinflation that can be transported digitally.

elevensies 9y ago

This is something I've been wondering about. Maybe someone with more bitcoin expertise could answer. Is there more mining capacity inside China than outside China? If so, and the Chinese government used their well-known firewall against Bitcoin for a matter of days to weeks, would Chinese miners have the longer chain? And thus the chain? I guess what I'm wondering is if the government of China has the ability to DOS Bitcoin as a payment system outside China at will.

prostoalex 9y ago
The attack you're describing is analogous to 50%+1 attack. The chain will fork, and after Bitcoin + Bitcoin Cash and Ethereum Classic + Ethereum it's reasonable to assume both versions will co-exist to some degree.
- elevensies 9y ago
  Yeah, I think that is the right way to think about it. I had always considered that in terms of mining power, not in term s of network control, but it is effectively the same incentives and consequences, just with different players.
cgore 9y ago
My guess is that the Chinese miners are often well-connected in the middle-levels of the Chinese government, the parts that actually implement such policies, and only a few less-connected miners would actually get blocked, thus increasing the profitability of the miners with government connections.
- contingencies 9y ago
  AFAIK mining doesn't actually require connectivity until you want to reveal the block. It's unlikely anyone else will discover it quickly, so you can just have someone walk across a border (or get on a flight) and plug it in to the global network from elsewhere.
  - 9y ago

kbody 9y ago

I'll focus on one thing that's fitting and haven't been mentioned. It's about Opendime ( https://opendime.com/ https://opendime.com/ ) which brands itself as a Bitcoin credit stick. It's like a USB stick but it stores inside a Bitcoin private key that's not revealed to the user unless they visibly break a part of the stick. This basically allows you to "load" bitcoins on the stick and give to others while being relatively certain of the "transaction" while of course being offline. I assume it's probably possible in theory that with an electronic microscope or something similar a skilled engineer will be able to read that private key, but I haven't read of any reports that it has happened yet, but it all depends on the value contained to make it worth the effort and even then we won't know. This basically allows off-chain & off-internet transacting which is really cool and enables the use in some more cases. Personally I know that Bitcoin is not perfect, it has strengths and weaknesses but it's good enough for a lot of use-cases at the moment and it will keep getting better. There are quite a lot of talented engineers & cryptographers actively working on Bitcoin and cryptocurrencies that will move things forward quite a lot. Unlike Gold, Bitcoin can be upgraded to do more thing and evolve, be it Bitcoin or some other cryptocurrency, unless we live on an age of having govs ban a technology it will find its place on our daily lives.

cesarb 9y ago
So, it's a real life version of Shadowrun's Credsticks? (http://shadowrun.wikia.com/wiki/Credstick http://shadowrun.wikia.com/wiki/Credstick)
- kbody 9y ago
  Indeed, iirc that was the idea/inspiration.

decentralised 9y ago

> a well functioning internet infrastructure Not that much. Most refugee camps have cell coverage and people there use btc as it's the only money they have access to.

decentralised 9y ago
Apparently it's not a good idea to point out that bitcoin not only survives, but thrives under harsh conditions here on HN.
- decentralised 9y ago
  lol And there's a satellite too now, so +1 resilience for Bitcoin! https://www.blockstream.com/satellite/ https://www.blockstream.com/satellite/

Taek 9y ago

> Bitcoin and other crypto require a well functioning internet infrastructure, otherwise it's just data on a hard-drive. Amazingly, not really. Bitcoin is a currency that's built to be disaster-proof, including world-ending scenarios like nuclear war between superpowers. You really just need 3 things: 1. A computer that can validate the chain. 2. The longest chain. This can be given to you via usb stick if the Internet is down. 3. Some way to send and receive blocks and transactions as the network continues building the longest chain. A lot of work has gone into being able to achieve number 3 without full internet infrastructure. The example of a satellite beaming blocks to the world has already been brought up (though this is receive only, not send-capable for most people). However, people have also written software that can transmit blocks over HAM radio. You can't download the full blockchain over HAM relay, but you can relay blocks and transactions in real time, because the whole network is bottlenecked to about 2 MB per 10 minutes. If you have wifi routers, you can set up point-to-point relay and broadcast systems as well. A point-to-point system can get well over 100 miles per hop. If the Interent were to suddenly fail, it may take a few weeks to connect everything together, but you could get Bitcoin up and running long before you could get anything like email working again. > There are states (even large ISPs) that can do that. While there are states that can split you from the main Internet, all you need is one relay that the state can't control to keep the Bitcoin network connected. It's not like a website where people have to keep asking a central server for data - once one person has relayed a block into an isolated network, the whole isolated network has that block. You can't keep the network isolated unless it's perfectly isolated, and on the scale of a country you are of course going to have people listening to the satellite broadcasts, setting up wifi relay points, or maybe even doing something less sophisticated like usb-smuggling which means it effectively takes a few days to be certain that a transaction has been confirmed by the broader network. ---------- TL;DR: Bitcoin is far more resilient than you give it credit, and it can survive the Internet going down. As long as you still have an ad-hoc way to transmit blocks to major areas, you can keep everyone fully in consensus. The infrastructure requirements of Bitcoin are far less than that of email, sms, or traditional website based, centralized infrastructure.

prostoalex 9y ago
> This can be given to you via usb stick if the Internet is down. What's the verification mechanism if you're given two or three USB sticks all swearing they have the latest and greatest blockchain?