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Why would you say that there's no legal means of redress? If someone steals my cryptocurrency, then I can still have law enforcement track them down and attemp

Why would you say that there's no legal means of redress? If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. This is not dissimilar to how cash works -- if someone takes my cash, by fraud, by theft, or in legitimate exchange for goods or services, that's it. They can now spend it however they want. Cash itself is a trustless system in the same sense. Where there is trust it's largely a matter of preventing forgery; which is not dissimilar to the idea of preventing double-spends. But until Bitcoin there was no real way to do cash-like transactions electronically. In other words, the utility of Bitcoin is well-established; humans have been using cash for a very long time. The implementation is novel. I don't speak here to the general "blockchain" concept, which has become so nebulous that I don't feel it's worth making general statements about.

jayd16 8y ago
If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all. >But until Bitcoin there was no real way to do cash-like transactions electronically. There was Venmo and all the other small cash transfer apps. BTC is decentralized but that's of questionable worth to an end user.
- bilbo0s 8y ago
  >If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all... Yep. Gotta agree with Jayd16 here, if you still need law enforcement, (ie - government), then bitcoin is not useful for operating without trust. The breathless hype about bitcoin was not just the technology level "distributed ledger" thing, but also the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point.
  - shawnz 8y ago
    > the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point. Bitcoin is independent of the "system" but that doesn't mean you don't still need some system. You're just not locked in to any particular system. Using bitcoin doesn't automatically make you an anarchist.
- ALittleLight 8y ago
  Venmo isn't exactly like cash. For example, my brother showed me that my transaction history was public by default (it hadn't even occurred to me that this was a conceivable design choice) and my brother was able to see who I had recently shared money with and in what amounts. Even if you know to disable that setting, that only prevents random people from seeing your transaction history, while Venmo and legal authorities still have easy access to it. Cash is nice because there is no history to it. It's private and anonymous.
  - jayd16 8y ago
    Venmo is just a popular example and there are a lot of others. However, if privacy is your concern, global public ledger tech isn't a good option either.
    - repomies68 8y ago
      Grin is quite amazing concept when it comes to privacy.
    - phil21 8y ago
      All other options like this share the property of a centralized trusted source mediating your transactions. The entire point is Bitcoin is like "cash for the Internet" in that once I hand someone $20 in BTC it's just like handing them $20 in physical cash. I have no third party either telling me I can't make that transaction, or with the ability to reverse the transaction after the fact. This is a feature, not a bug. Anything to disintermediate financial institutions that like to apply political and corporate policy on who I can conduct business with is a good thing in my opinion. This means my options when the third party frauds me are the traditional options employed by folks dealing with cash transactions since money was invented. I can sue them in court, forget about it, or round up some friends with lead pipes. I think many folks completely miss the point. Cash is useful. Cashless society is about the worst dystopia I can imagine - with unaccountable third parties and government able to track your every spending move, while simultaneously applying their political or legal policy to every transaction. Bitcoin's first step into introducing cash-like digital currency is the innovation, and it clearly is needed. Certainly not perfect (privacy could be far better, security is a real problem, etc.) - but it's far better than anything that had previously come along. Comparing venmo to bitcoin is simply not a comparison - they solve entirely different problems. Venmo lets you send money from your bank account to another bank account with all those political and legal restrictions applied to your transaction. Bitcoin effectively lets you send cash to anyone you want, in any amount, and no one can stop that transaction from happening because they didn't like the person you are sending it to or what you were buying.
wil421 8y ago
If someone steals money from my Bank account my bank will retun the money next business day. No police reports required and little intervention on my part. I’ve had it happen twice when my card was skimmed in Europe. Both times they called me to report suspicious activity. Your comparing cash to something electronic. No matter how you spin it Bitcoin is not physical. It’s more akin to cash in a bank account. Cash is in my hand, Bitcoin is virtual. >The $0 Liability Guarantee covers fraudulent transactions made by others using your Bank of America consumer credit cards and consumer and small business debit and ATM cards. To be covered, report transactions made by others promptly, and don't share personal or account information with anyone. Access to funds next business day in most cases, pending resolution of claim. Consult client and account agreements for full details.[1] [1]https://www.bankofamerica.com/privacy/faq/data-compromise-faq.go https://www.bankofamerica.com/privacy/faq/data-compromise-fa...
- dylkil 8y ago
  Your bank takes the loss on those stolen funds. Bitcoin is more akin to cash in hand than cash in a bank account, the title of the white paper is a 'A Peer-to-Peer Electronic Cash System'. It behaves like cash.
- Scene_Cast2 8y ago
  You're conflating reduction of risk (system-wide) and offloading of risk. In your bank example, the bank likely took the financial hit. With bitcoin as an underlying tech, there's some reduction of risk (with a whole bunch of asterisks).
  - wil421 8y ago
    Why would I care if the banks took a hit? If fraud was hurting their margins significantly we would see the government step in. The banks would also do more to prevent it. The US just switched over to chip cards.
    - JangoSteve 8y ago
      Because you're paying for it with your money. They can afford to take a hit (and can afford the insurance for such losses) because of the fees they charge you directly, and the money they make utilizing your principle for other purposes while it's there.
justsayin_3000 8y ago
>> Why would you say that there's no legal means of redress? If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. Then you are effectively trusting a third party to make it right when you have been wronged. Isn't this contradictory to the promise of blockchains: That trusting a third party is not required?? Taking this further, you are saying that the data on a blockchain cannot be trusted because the transactions might be reversed due to outside action. Honest question: How does this fit into the concept of a blockchain?
yingw787 8y ago
I think the difference is the police officially recognize one currency and do not officially recognize the other. The U.S. dollar is backed by the full faith and trust of the U.S. government. A cryptocurrency's value is backed by the amount of other fiat currencies pumped into it. If in the future, an authority figure (say, the President of the United States) created a cryptocurrency and ordered the FBI to prioritize cybercrimes relevant to that currency and drop investigations for others, you'd be in a bad place if somebody in a different state stole your money. He/she could never do that with the U.S. dollar, since manipulating that infringes on his/her literal ability to order people around.
- andrewla 8y ago
  There is not a separate crime of "theft of money" and "theft of property". Electronic crimes, like the theft of key material, is usually covered by different laws. In places where there have been cryptocurrency thefts that have been prosecuted, they have been primarily pursued as cases of theft -- the US statutory definitions of theft usually only use the monetary value (the USD equivalent) as the determiner of the severity. While such a policy of "do not pursue bitcoin theft" would theoretically be possible either as an explicit policy or an informal, I thing it would be unlikely to survive judicial scrutiny; it would be like insisting that car thefts only be investigated and prosecuted for American-made cars.
deleted 8y ago
[deleted]
- dylkil 8y ago
  as a taxpayer, thats a strange thing to say
50656E6973 8y ago
>If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. Is this something that actually happens? Police hardly help with with recovering stolen physical goods; I highly doubt they'd even consider helping if your crypto gets hacked
- repomies68 8y ago
  They might claim that they tried to help.
fixermark 8y ago
There's a significant difference between Bitcoin and cash, which is that the worst-case scenario for loss of your cash is the government in control of it just prints more and gives it to you (in effect, distributing the cost of your loss among everyone who holds that currency). This is not technically possible with Bitcoin, and AFAIK no system has grown up organically yet to provide some kind of "loss insurance" in the form of keeping some BTC in reserve for making victims whole.
- ravingraven 8y ago
  >This is not technically possible with Bitcoin [...] Of course, it is. The government could force everyone to send Bitcoins to a special account which is then distributed to victims (i.e. a tax). That would actually be better than what we have now. By printing more cash, people with cash are punished while actually rich people (who own stock, real estate, factories, jets etc.) are not.
  - fixermark 8y ago
    By "not technically possible," I meant specifically that no government can cause new BTC to manifest into existence. The scenario you're describing is (government mandated and legally enforced) loss insurance, which is the system I observed hasn't (to my knowledge) organically manifested yet.
- awrence 8y ago
  What you're describing is basically an insurance mechanism. There is no reason you couldn't implement the same for cryptos. But at least under that explicit framework, those who had not participated in that scheme would not have to pay the risk premium associated with it which is currently incurred by fiat holders whether they like it or not (under your scenario).

jayd16 8y ago

If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all. >But until Bitcoin there was no real way to do cash-like transactions electronically. There was Venmo and all the other small cash transfer apps. BTC is decentralized but that's of questionable worth to an end user.

bilbo0s 8y ago
>If you have to rely on and/or beholden to legal action, then BTC doesn't really provide trust at all... Yep. Gotta agree with Jayd16 here, if you still need law enforcement, (ie - government), then bitcoin is not useful for operating without trust. The breathless hype about bitcoin was not just the technology level "distributed ledger" thing, but also the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point.
- shawnz 8y ago
  > the idea that you could do things independent of the system. If you still need the system to make it all work, then it definitely fails on the latter hype point. Bitcoin is independent of the "system" but that doesn't mean you don't still need some system. You're just not locked in to any particular system. Using bitcoin doesn't automatically make you an anarchist.
ALittleLight 8y ago
Venmo isn't exactly like cash. For example, my brother showed me that my transaction history was public by default (it hadn't even occurred to me that this was a conceivable design choice) and my brother was able to see who I had recently shared money with and in what amounts. Even if you know to disable that setting, that only prevents random people from seeing your transaction history, while Venmo and legal authorities still have easy access to it. Cash is nice because there is no history to it. It's private and anonymous.
- jayd16 8y ago
  Venmo is just a popular example and there are a lot of others. However, if privacy is your concern, global public ledger tech isn't a good option either.
  - repomies68 8y ago
    Grin is quite amazing concept when it comes to privacy.
  - phil21 8y ago
    All other options like this share the property of a centralized trusted source mediating your transactions. The entire point is Bitcoin is like "cash for the Internet" in that once I hand someone $20 in BTC it's just like handing them $20 in physical cash. I have no third party either telling me I can't make that transaction, or with the ability to reverse the transaction after the fact. This is a feature, not a bug. Anything to disintermediate financial institutions that like to apply political and corporate policy on who I can conduct business with is a good thing in my opinion. This means my options when the third party frauds me are the traditional options employed by folks dealing with cash transactions since money was invented. I can sue them in court, forget about it, or round up some friends with lead pipes. I think many folks completely miss the point. Cash is useful. Cashless society is about the worst dystopia I can imagine - with unaccountable third parties and government able to track your every spending move, while simultaneously applying their political or legal policy to every transaction. Bitcoin's first step into introducing cash-like digital currency is the innovation, and it clearly is needed. Certainly not perfect (privacy could be far better, security is a real problem, etc.) - but it's far better than anything that had previously come along. Comparing venmo to bitcoin is simply not a comparison - they solve entirely different problems. Venmo lets you send money from your bank account to another bank account with all those political and legal restrictions applied to your transaction. Bitcoin effectively lets you send cash to anyone you want, in any amount, and no one can stop that transaction from happening because they didn't like the person you are sending it to or what you were buying.

wil421 8y ago

If someone steals money from my Bank account my bank will retun the money next business day. No police reports required and little intervention on my part. I’ve had it happen twice when my card was skimmed in Europe. Both times they called me to report suspicious activity. Your comparing cash to something electronic. No matter how you spin it Bitcoin is not physical. It’s more akin to cash in a bank account. Cash is in my hand, Bitcoin is virtual. >The $0 Liability Guarantee covers fraudulent transactions made by others using your Bank of America consumer credit cards and consumer and small business debit and ATM cards. To be covered, report transactions made by others promptly, and don't share personal or account information with anyone. Access to funds next business day in most cases, pending resolution of claim. Consult client and account agreements for full details.[1] [1]https://www.bankofamerica.com/privacy/faq/data-compromise-faq.go https://www.bankofamerica.com/privacy/faq/data-compromise-fa...

dylkil 8y ago
Your bank takes the loss on those stolen funds. Bitcoin is more akin to cash in hand than cash in a bank account, the title of the white paper is a 'A Peer-to-Peer Electronic Cash System'. It behaves like cash.
Scene_Cast2 8y ago
You're conflating reduction of risk (system-wide) and offloading of risk. In your bank example, the bank likely took the financial hit. With bitcoin as an underlying tech, there's some reduction of risk (with a whole bunch of asterisks).
- wil421 8y ago
  Why would I care if the banks took a hit? If fraud was hurting their margins significantly we would see the government step in. The banks would also do more to prevent it. The US just switched over to chip cards.
  - JangoSteve 8y ago
    Because you're paying for it with your money. They can afford to take a hit (and can afford the insurance for such losses) because of the fees they charge you directly, and the money they make utilizing your principle for other purposes while it's there.

justsayin_3000 8y ago

>> Why would you say that there's no legal means of redress? If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. Then you are effectively trusting a third party to make it right when you have been wronged. Isn't this contradictory to the promise of blockchains: That trusting a third party is not required?? Taking this further, you are saying that the data on a blockchain cannot be trusted because the transactions might be reversed due to outside action. Honest question: How does this fit into the concept of a blockchain?

yingw787 8y ago

I think the difference is the police officially recognize one currency and do not officially recognize the other. The U.S. dollar is backed by the full faith and trust of the U.S. government. A cryptocurrency's value is backed by the amount of other fiat currencies pumped into it. If in the future, an authority figure (say, the President of the United States) created a cryptocurrency and ordered the FBI to prioritize cybercrimes relevant to that currency and drop investigations for others, you'd be in a bad place if somebody in a different state stole your money. He/she could never do that with the U.S. dollar, since manipulating that infringes on his/her literal ability to order people around.

andrewla 8y ago
There is not a separate crime of "theft of money" and "theft of property". Electronic crimes, like the theft of key material, is usually covered by different laws. In places where there have been cryptocurrency thefts that have been prosecuted, they have been primarily pursued as cases of theft -- the US statutory definitions of theft usually only use the monetary value (the USD equivalent) as the determiner of the severity. While such a policy of "do not pursue bitcoin theft" would theoretically be possible either as an explicit policy or an informal, I thing it would be unlikely to survive judicial scrutiny; it would be like insisting that car thefts only be investigated and prosecuted for American-made cars.

deleted 8y ago

[deleted]

dylkil 8y ago
as a taxpayer, thats a strange thing to say

50656E6973 8y ago

>If someone steals my cryptocurrency, then I can still have law enforcement track them down and attempt to recover the funds. Is this something that actually happens? Police hardly help with with recovering stolen physical goods; I highly doubt they'd even consider helping if your crypto gets hacked

repomies68 8y ago
They might claim that they tried to help.

fixermark 8y ago

There's a significant difference between Bitcoin and cash, which is that the worst-case scenario for loss of your cash is the government in control of it just prints more and gives it to you (in effect, distributing the cost of your loss among everyone who holds that currency). This is not technically possible with Bitcoin, and AFAIK no system has grown up organically yet to provide some kind of "loss insurance" in the form of keeping some BTC in reserve for making victims whole.

ravingraven 8y ago
>This is not technically possible with Bitcoin [...] Of course, it is. The government could force everyone to send Bitcoins to a special account which is then distributed to victims (i.e. a tax). That would actually be better than what we have now. By printing more cash, people with cash are punished while actually rich people (who own stock, real estate, factories, jets etc.) are not.
- fixermark 8y ago
  By "not technically possible," I meant specifically that no government can cause new BTC to manifest into existence. The scenario you're describing is (government mandated and legally enforced) loss insurance, which is the system I observed hasn't (to my knowledge) organically manifested yet.
awrence 8y ago
What you're describing is basically an insurance mechanism. There is no reason you couldn't implement the same for cryptos. But at least under that explicit framework, those who had not participated in that scheme would not have to pay the risk premium associated with it which is currently incurred by fiat holders whether they like it or not (under your scenario).