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I think it's incredibly naive to believe that the main problem of cryptocurrency today is the lack of privacy. The ease of which you can launder crypto is the m

by yholio 8y ago

I think it's incredibly naive to believe that the main problem of cryptocurrency today is the lack of privacy. The ease of which you can launder crypto is the main obstacle against it's widespread integration into the financial system. Sure, a Bitcoin transaction might leak an address, an amount or an IP. So what? Coupling Tor with a trusted coin tumbler, any serious criminal can hide his tracks, so if cryptocurrency is to become just as good as "money in the bank", then he is home free. Grin proposes to optimize that further and provide similar levels of anonymity to average users who don't really ask for it - talk about missing the point. The wholly grail of cryptocurrency today is not optimizing anonymity but gaining legitimacy and working as a payment system parallel to national currencies while complying with the complex regulations around KYC and criminal and terrorist financing. These are vigorously enforced in any first world nation, for sound, historic reasons. The wholly grail is to opt out of government surveillance while maintaining social responsibility and capacity to root out bad actors. This will probably require a mixed, technological, institutional and regulatory response if it is ever to be realized. Abstracting the real world away and hiding in your little cryptographic fantasy governed only by math and not people will leave you with speculative playmoney in the best case and a dangerous can of worms in the worst.

StreamBright 8y ago
Well Bitcoin is completely unsuitable for handling transactions for many reasons (transaction time, energy consumption, just to name a few). Btw. until you are going through internet devices (routers) with your transactions government surveillance is there, so it does not solve that either. The reason why even security aware people think that cryptocurrency guys are nuts is exactly this reason, you think that you can outsmart an adversary that has unlimited resources (at least compare to you). If you look at recent developments in Australia you would understand that you cannot do anything against a government than vote the right people into power and apply pressure to politicians to end unlimited surveillance that is granted with laws like the Patriot Act. "Coupling Tor with a trusted coin tumbler, any serious criminal can hide his tracks" They absolutely cannot. Their tracks are in the the NSA database in Utah. Tor is great for one thing mark yourself suspicious so it is easier to track you down. https://surveillancevalley.com/blog/interview-in-german-magazine-konkret-about-tor-and-the-cult-of-crypto https://surveillancevalley.com/blog/interview-in-german-maga... https://motherboard.vice.com/en_us/article/nzemvg/dont-just-rely-on-tor-security-advice-from-an-alleged-dark-web-veteran https://motherboard.vice.com/en_us/article/nzemvg/dont-just-... https://boingboing.net/2016/07/01/researchers-find-over-100-spyi.html https://boingboing.net/2016/07/01/researchers-find-over-100-... TL;DR version for the inpatient "It all depends on who you are trying to protect yourself from. The biggest forces of surveillance in the world are not governments, but private corporations: Google, Facebook, Twitter, Yahoo, Amazon, eBay, Apple — companies whose core business runs on the surveillance and profiling of every person that comes into contact with their platforms. Everything that you communicate on the Internet gets sucked up and filed away — not by the NSA, but by Google and Facebook. Tor does nothing to protect people from that. Tor does not prevent Google from scanning your emails or recording your search history. Tor does not prevent Google from tracking your location via your Android phone, creating and saving a detailed day by day map of where you go and what you do. Tor works to an extent. If you an individual trying to hide from the NSA or the FBI or the FSB, Tor might give you some measure of protection — if you are very technically savvy — but it is a limited sort of protection. It does not protect users against corporate surveillance. But it does provide a false sense of privacy. That is why Silicon Valley companies like Google and Facebook support Tor: it sells a version of privacy — privacy from the government — that does not threaten their own surveillance business models."
koheripbal 8y ago
> gaining legitimacy and working as a payment system parallel to national currencies while complying with the complex regulations This is an impossible requirement. Every country has different, subjective, fluctuating, and often vague regulatory requirements. Not decentralized platform could ever comply. The reason crypto hasn't taken hold is simply that it doesn't scale. When enough people use it, the system grinds to a halt. Newer cryptos, like Monero have made some big steps recently, but there's still a long long long way to go for scalability.
- yholio 8y ago
  > This is an impossible requirement. Every country has different, subjective, fluctuating, and often vague regulatory requirements. Not decentralized platform could ever comply. We first need to acknowledge the need to comply with the spirit of these regulations and allow some features that national operators can build on to create legal solutions. There is a commonality here and there is a international convergence towards similar regulations. Sure, some countries with particular draconian legislation could still reject crypto, but there could exist a workable compromise in most other countries. I reject this idea that we need to go Full Monty: from one end of the spectrum (no privacy, complete state control over money and banks) to the other end, financial anarchy.
  - creeble 8y ago
    You may reject the idea, but I don't see how it can be anything _other_ than what you describe as "financial anarchy". You either trust national governments and their KYC and AML laws, or you trust the crypto network and _its_ governance. That is the whole point, as stated by Satoshi. If your crypto complies with some least- or greatest-common-denominator of government laws (as they apply to their national currencies), then what is the point?
    - yholio 8y ago
      The point was not that cryptocurrencies should be state run, rather that the social values embedded in their algorithmic regulation should respect a wider set of social values and accommodate applications that can comply with typical national legislation resulting from those values. See your brother comment for an alternate perspective, cryptocurrency already embed regulatory frameworks that reflect social values, for example, the need to control inflation or the need for financial privacy. If the decentralized governance rejects on principle that money laundry is a social problem, then society through it's various forms of governance might reject the currency, just as it would reject say, a hyperinflationary currency. This is what I mean to say by "going full-crypto-Monty": there is a strong tendency in the community to reject some important social values without debate and to try to enforce a political perspective on how society should work by circumventing the legitimate venue where these political debates are fought. The more the problem is asserted, the more crypto people double-down on their utopian narrative and invent new technical measures to circumvent any social control, such as this here.
rdl 8y ago
“Dangerous can of worms” is the goal, although understates the level of danger and utility. https://www.activism.net/cypherpunk/crypto-anarchy.html https://www.activism.net/cypherpunk/crypto-anarchy.html
psimondo 8y ago
I disagree with his almost completely. When you pay someone with Bitcoin, the receiver knows your wallet and can look up your balance and every transaction you have ever made. That’s crazy. People may not realize the implication at first but they will. Imagine mainstream scenario and vendor behavior: you pay once, they know you are rich and adjust the price next time around. Or your insurer trawls your purchase history and adjusts your premiums because you eat fast food. etc. A certain amount of privacy when paying is absolutely essential for mainstream adoption. As for legitimacy. If people used crypto for payments without ever converting to fiat, absolutely no “on high” institution or state can confer legitimacy. It’s irrelevant. And as for money laundering and terrorism. Give me a break. The existing financial system is gamed all the time by nation states, the wealthy with shell companies and tax havens and the biggest ‘coin’ in all these activities is the USD. These laws are vigorously enforced entirely selectively and usually politically. I’d rather it was simply impossible. As for bad actors, these exist now and always will, that doesn’t mean you stop the rest of the world having access to tools to move value how they want and avoid state run monetary policy. The world’s elites and mega corps do this now already.
antidesitter 8y ago
> The wholly grail of cryptocurrency today is not optimizing anonymity but... complying with the complex regulations around KYC and criminal and terrorist financing. What the... That’s not the goal of cryptocurrency according to its creators. The goal is, as you stated later, “to opt out of government surveillance”, which is incompatible with the former. You’re contradicting yourself.
- yholio 8y ago
  There is a contradiction between privacy and law enforcement only if you think in rudimentary, white/black extremes. Why don't you allow for shades of gray, workable anonymity that protects most regular people yet can be lifted by law enforcement in a auditable and costly process that rules out mass surveillance? Why can't we have crypto-banks that know you identity yet can't freeze your assets, only atest to them when compelled so by law? Can you mathematically prove such constructs are not possible? Is there a possibility they could serve society's needs better than either the current banking system or the Bitcoin-style hodge-podge?
  - antidesitter 8y ago
    Please explain how you can have anonimity if it can be lifted by law enforcement. The selling point of cryptocurrencies is not being beholden to the whims of a government.
    - yholio 8y ago
      You can have limited anonymity and the option of hiding into the crowds. To give a very crude example, a FBI backdoor key established in the genesis block could allow them to publish into the blockchain a personal information fetch request that is public and has a public field that the agency is expected to populate with relevant court order number. They could of course issue requests without that field, but in that case everyone could see their behavior and laws could be passed to make it illegal. A further refinement would be to request a financial bond before the operation is executed. This bond could increase exponentially, guaranteeing the backdoor cannot be abused for mass surveillance and is employed for limited, high profile cases. The "whims of a government" are often the expression of strong social forces that exist for a reason. Rejecting any form of social governance is an Utopian political construction at it's core, masquerading here as technology.

by yholio 8y ago

StreamBright 8y ago

Well Bitcoin is completely unsuitable for handling transactions for many reasons (transaction time, energy consumption, just to name a few). Btw. until you are going through internet devices (routers) with your transactions government surveillance is there, so it does not solve that either. The reason why even security aware people think that cryptocurrency guys are nuts is exactly this reason, you think that you can outsmart an adversary that has unlimited resources (at least compare to you). If you look at recent developments in Australia you would understand that you cannot do anything against a government than vote the right people into power and apply pressure to politicians to end unlimited surveillance that is granted with laws like the Patriot Act. "Coupling Tor with a trusted coin tumbler, any serious criminal can hide his tracks" They absolutely cannot. Their tracks are in the the NSA database in Utah. Tor is great for one thing mark yourself suspicious so it is easier to track you down. https://surveillancevalley.com/blog/interview-in-german-magazine-konkret-about-tor-and-the-cult-of-crypto https://surveillancevalley.com/blog/interview-in-german-maga... https://motherboard.vice.com/en_us/article/nzemvg/dont-just-rely-on-tor-security-advice-from-an-alleged-dark-web-veteran https://motherboard.vice.com/en_us/article/nzemvg/dont-just-... https://boingboing.net/2016/07/01/researchers-find-over-100-spyi.html https://boingboing.net/2016/07/01/researchers-find-over-100-... TL;DR version for the inpatient "It all depends on who you are trying to protect yourself from. The biggest forces of surveillance in the world are not governments, but private corporations: Google, Facebook, Twitter, Yahoo, Amazon, eBay, Apple — companies whose core business runs on the surveillance and profiling of every person that comes into contact with their platforms. Everything that you communicate on the Internet gets sucked up and filed away — not by the NSA, but by Google and Facebook. Tor does nothing to protect people from that. Tor does not prevent Google from scanning your emails or recording your search history. Tor does not prevent Google from tracking your location via your Android phone, creating and saving a detailed day by day map of where you go and what you do. Tor works to an extent. If you an individual trying to hide from the NSA or the FBI or the FSB, Tor might give you some measure of protection — if you are very technically savvy — but it is a limited sort of protection. It does not protect users against corporate surveillance. But it does provide a false sense of privacy. That is why Silicon Valley companies like Google and Facebook support Tor: it sells a version of privacy — privacy from the government — that does not threaten their own surveillance business models."

koheripbal 8y ago

> gaining legitimacy and working as a payment system parallel to national currencies while complying with the complex regulations This is an impossible requirement. Every country has different, subjective, fluctuating, and often vague regulatory requirements. Not decentralized platform could ever comply. The reason crypto hasn't taken hold is simply that it doesn't scale. When enough people use it, the system grinds to a halt. Newer cryptos, like Monero have made some big steps recently, but there's still a long long long way to go for scalability.

yholio 8y ago
> This is an impossible requirement. Every country has different, subjective, fluctuating, and often vague regulatory requirements. Not decentralized platform could ever comply. We first need to acknowledge the need to comply with the spirit of these regulations and allow some features that national operators can build on to create legal solutions. There is a commonality here and there is a international convergence towards similar regulations. Sure, some countries with particular draconian legislation could still reject crypto, but there could exist a workable compromise in most other countries. I reject this idea that we need to go Full Monty: from one end of the spectrum (no privacy, complete state control over money and banks) to the other end, financial anarchy.
- creeble 8y ago
  You may reject the idea, but I don't see how it can be anything _other_ than what you describe as "financial anarchy". You either trust national governments and their KYC and AML laws, or you trust the crypto network and _its_ governance. That is the whole point, as stated by Satoshi. If your crypto complies with some least- or greatest-common-denominator of government laws (as they apply to their national currencies), then what is the point?
  - yholio 8y ago
    The point was not that cryptocurrencies should be state run, rather that the social values embedded in their algorithmic regulation should respect a wider set of social values and accommodate applications that can comply with typical national legislation resulting from those values. See your brother comment for an alternate perspective, cryptocurrency already embed regulatory frameworks that reflect social values, for example, the need to control inflation or the need for financial privacy. If the decentralized governance rejects on principle that money laundry is a social problem, then society through it's various forms of governance might reject the currency, just as it would reject say, a hyperinflationary currency. This is what I mean to say by "going full-crypto-Monty": there is a strong tendency in the community to reject some important social values without debate and to try to enforce a political perspective on how society should work by circumventing the legitimate venue where these political debates are fought. The more the problem is asserted, the more crypto people double-down on their utopian narrative and invent new technical measures to circumvent any social control, such as this here.

rdl 8y ago

“Dangerous can of worms” is the goal, although understates the level of danger and utility. https://www.activism.net/cypherpunk/crypto-anarchy.html https://www.activism.net/cypherpunk/crypto-anarchy.html

psimondo 8y ago

I disagree with his almost completely. When you pay someone with Bitcoin, the receiver knows your wallet and can look up your balance and every transaction you have ever made. That’s crazy. People may not realize the implication at first but they will. Imagine mainstream scenario and vendor behavior: you pay once, they know you are rich and adjust the price next time around. Or your insurer trawls your purchase history and adjusts your premiums because you eat fast food. etc. A certain amount of privacy when paying is absolutely essential for mainstream adoption. As for legitimacy. If people used crypto for payments without ever converting to fiat, absolutely no “on high” institution or state can confer legitimacy. It’s irrelevant. And as for money laundering and terrorism. Give me a break. The existing financial system is gamed all the time by nation states, the wealthy with shell companies and tax havens and the biggest ‘coin’ in all these activities is the USD. These laws are vigorously enforced entirely selectively and usually politically. I’d rather it was simply impossible. As for bad actors, these exist now and always will, that doesn’t mean you stop the rest of the world having access to tools to move value how they want and avoid state run monetary policy. The world’s elites and mega corps do this now already.

antidesitter 8y ago

> The wholly grail of cryptocurrency today is not optimizing anonymity but... complying with the complex regulations around KYC and criminal and terrorist financing. What the... That’s not the goal of cryptocurrency according to its creators. The goal is, as you stated later, “to opt out of government surveillance”, which is incompatible with the former. You’re contradicting yourself.

yholio 8y ago
There is a contradiction between privacy and law enforcement only if you think in rudimentary, white/black extremes. Why don't you allow for shades of gray, workable anonymity that protects most regular people yet can be lifted by law enforcement in a auditable and costly process that rules out mass surveillance? Why can't we have crypto-banks that know you identity yet can't freeze your assets, only atest to them when compelled so by law? Can you mathematically prove such constructs are not possible? Is there a possibility they could serve society's needs better than either the current banking system or the Bitcoin-style hodge-podge?
- antidesitter 8y ago
  Please explain how you can have anonimity if it can be lifted by law enforcement. The selling point of cryptocurrencies is not being beholden to the whims of a government.
  - yholio 8y ago
    You can have limited anonymity and the option of hiding into the crowds. To give a very crude example, a FBI backdoor key established in the genesis block could allow them to publish into the blockchain a personal information fetch request that is public and has a public field that the agency is expected to populate with relevant court order number. They could of course issue requests without that field, but in that case everyone could see their behavior and laws could be passed to make it illegal. A further refinement would be to request a financial bond before the operation is executed. This bond could increase exponentially, guaranteeing the backdoor cannot be abused for mass surveillance and is employed for limited, high profile cases. The "whims of a government" are often the expression of strong social forces that exist for a reason. Rejecting any form of social governance is an Utopian political construction at it's core, masquerading here as technology.