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> Commentators are confusing fungibility and traceability. They are very different concepts. No, I think the commentators and the author of the article are mak

> Commentators are confusing fungibility and traceability. They are very different concepts. No, I think the commentators and the author of the article are making a valid point that you’re missing: They may be fungible if you ignore everything else about the Bitcoin ecosystem and focus only on the blockchain ledger, but you can’t divorce the Bitcoin balances from their history. As regulations mount and exchanges become more active in recovering stolen coins, the practical reality of Bitcoin will mean that they’re not entirely fungible depending on the history. I think many people in the comments are in such a rush to declare Bitcoin as fungible that they’re missing the point of the article.

analog31 5y ago
This is something I would worry about. If a particular piece of bitcoin becomes tainted because it's associated with dirty money (or whatever), and I receive it as a payment, will it become harder to spend or of less value? What if it goes onto some sort of blacklist? To use the recent parlance, can my money be "cancelled" by popular opinion?
- labster 5y ago
  Yes, popular opinion can cancel you via forking the blockchain or software.
- Ekaros 5y ago
  Yes, and this popular opinion is one of the exchanges and online wallets. Not necessarily the miners or nodes running the network.
- chii 5y ago
  which kind of goes against the very philosophy of bitcoins in the first place, where there should not be centralized control of the currency. A blacklist of coins is a defacto centralized control.
  - analog31 5y ago
    On the other hand, the lack of centralized control means that each person can have their own philosophy of bitcoins. Literally every individual can have their own belief about what bitcoins are useful for. The only limitation is whether a particular philosophy makes sense in light of how bitcoins work and behave at any given moment.
halestock 5y ago
The same could be said about the dollar. If I steal a large amount of money from a bank, or sell a bunch of drugs, I can't spend that money without laundering it first, but that has nothing to do with the fungibility of the dollar. The "practical reality" is irrelevant because tracibility is orthogonal to fungibility. They're different properties.
- boh 5y ago
  Unlaundered, ill gotten gains will be accepted as legal tender. The money itself will not lose its value because you've tainted it with sin--you'll just likely be caught if you spend too much of it at once. You might notice the person at the 711 register isn't scanning bills to check their legitimacy.
  - halestock 5y ago
    > The money itself will not lose its value because you've tainted it with sin--you'll just likely be caught if you spend too much of it at once. So how is this different from, say, using a tumbler? The crux of TFA's argument is that Bitcoin is tainted with sin.
  - codeflo 5y ago
    In reality, few things are perfectly binary, there’s a spectrum between perfectly fungible and perfectly nonfungible. And yes, a million dollars of stolen cash is worth strictly less than a million dollars because (leaving ethics aside) it takes a nontrivial amount of time, money and risk to launder it before you can safely spend it.
    - boh 5y ago
      No there isn't a spectrum. A stolen million is still worth a million. If a thief is laundering the money, he's choosing to spend it--no dollar just loses value all of a sudden. You may be using cash once used to buy drugs or hire an assassin, but it doesn't get tainted and diminish your ability to spend it. Restricted Bitcoin literally cant be used for transactions making the Bitcoin itself worthless even if it wasn't you who committed the crime that got it restricted. That doesn't happen with cash.

analog31 5y ago

This is something I would worry about. If a particular piece of bitcoin becomes tainted because it's associated with dirty money (or whatever), and I receive it as a payment, will it become harder to spend or of less value? What if it goes onto some sort of blacklist? To use the recent parlance, can my money be "cancelled" by popular opinion?

labster 5y ago
Yes, popular opinion can cancel you via forking the blockchain or software.
Ekaros 5y ago
Yes, and this popular opinion is one of the exchanges and online wallets. Not necessarily the miners or nodes running the network.
chii 5y ago
which kind of goes against the very philosophy of bitcoins in the first place, where there should not be centralized control of the currency. A blacklist of coins is a defacto centralized control.
- analog31 5y ago
  On the other hand, the lack of centralized control means that each person can have their own philosophy of bitcoins. Literally every individual can have their own belief about what bitcoins are useful for. The only limitation is whether a particular philosophy makes sense in light of how bitcoins work and behave at any given moment.

halestock 5y ago

The same could be said about the dollar. If I steal a large amount of money from a bank, or sell a bunch of drugs, I can't spend that money without laundering it first, but that has nothing to do with the fungibility of the dollar. The "practical reality" is irrelevant because tracibility is orthogonal to fungibility. They're different properties.

boh 5y ago
Unlaundered, ill gotten gains will be accepted as legal tender. The money itself will not lose its value because you've tainted it with sin--you'll just likely be caught if you spend too much of it at once. You might notice the person at the 711 register isn't scanning bills to check their legitimacy.
- halestock 5y ago
  > The money itself will not lose its value because you've tainted it with sin--you'll just likely be caught if you spend too much of it at once. So how is this different from, say, using a tumbler? The crux of TFA's argument is that Bitcoin is tainted with sin.
- codeflo 5y ago
  In reality, few things are perfectly binary, there’s a spectrum between perfectly fungible and perfectly nonfungible. And yes, a million dollars of stolen cash is worth strictly less than a million dollars because (leaving ethics aside) it takes a nontrivial amount of time, money and risk to launder it before you can safely spend it.
  - boh 5y ago
    No there isn't a spectrum. A stolen million is still worth a million. If a thief is laundering the money, he's choosing to spend it--no dollar just loses value all of a sudden. You may be using cash once used to buy drugs or hire an assassin, but it doesn't get tainted and diminish your ability to spend it. Restricted Bitcoin literally cant be used for transactions making the Bitcoin itself worthless even if it wasn't you who committed the crime that got it restricted. That doesn't happen with cash.