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Banks are investing in multifactor authentication systems to try to do away with passwords. The bitcoin ecosystem are also converging toward that. Or rather, a

by kiba 15y ago

Banks are investing in multifactor authentication systems to try to do away with passwords. The bitcoin ecosystem are also converging toward that. Or rather, any serious bitcoin payment processor will also be exploring any real security solution, even if it comes from traditional banks. This isn't a problem Bitcoin contemplates. Think of bitcoin technology as the OS which bitcoin banks run on. There are advantages and disadvantage to using bitcoin as cash, or storing bitcoin with your bank, depending on situations you may encounter.

tptacek 15y ago
Exasperating. Bitcoin is on the scale of global commerce simply a thought experiment (or, less charitably, a Ponzi scheme). So, of course, anything the modern banking system doesn't fully accomplish is "coming soon" for Bitcoin, right around the corner. Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. No, somehow engineering problems that banks can't solve with tens of millions of dollars of dedicated IT security investment are going to be solved by Bitcoin startups for half-pennies on the dollar. But, at any rate: exasperating though your argument is, it's also a non-sequitor. My point is that banks are dealing with zombie customer machines controlled by malware. Bitcoin falls to that same threat scenario too.
- kiba 15y ago
  Bitcoin is on the scale of global commerce simply a thought experiment (or, less charitably, a Ponzi scheme). All successful things start small. Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. No, somehow engineering problems that banks can't solve with tens of millions of dollars of dedicated IT security investment are going to be solved by Bitcoin startups for half-pennies on the dollar. I don't claim that bitcoin startup solve problems that banks can't solve, just that I am asking you to compare bitcoin banks with banks, not bitcoin to banks.
  - deleted 15y ago
    [deleted]
    - kiba 15y ago
      Once again a Bitcoin advocate asks us to compare a hypothetical fantasy institution with a real-world business, The biggest company in the arena is currently mtgox, which is admittedly a bitcoin exchange, but they also have a merchant solution and function like paypal in some respect. They have a multi factor authentication scheme. There is also a company called bit-pay that acts like a regular payment processor. Also, Gavin is working on adding support for multisignature transaction, which will help everyone in the bitcoin ecosystem. and, presumably, to plow money into Bitcoin accordingly. It doesn't matter as long the argument stand or the reason is sound.
  - tptacek 15y ago
    So do the unsuccessful things.
- kylebrown 15y ago
  > Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. The last (and hopefully only) time a critical vulnerability was found in bitcoin was in May '09: it was exploited on the testnet and then patched. The largest bitcoin exchange did have a security breach in July '11 and suffered a loss of 6k bitcoins, but the rest (most of which were in cold storage) remained secure (at least 424k bitcoins). And in the most recent incident, a couple of popular services lost a combined 50k bitcoins (the users were not affected) because Linode was compromised. Your "fact" is entirely disingenuous. Bitcoin is certainly not a silver bullet to securely using on a compromised machine (and nobody is claiming that it is). Obviously no system will ever 100% protect stupid/compromised users. But many credit card numbers are compromised mid-stream or at a malicious PoS. The public-key nature of bitcoin protects against those attacks.
  - tptacek 15y ago
    I like this argument, which tries to separate the "security" of the Bitcoin protocol/cryptosystem from the security of its implementations, so that the protocol can serve as a sort of inverse straw man to deflect attention from the comically poor security track record of Bitcoin as it actually works in the real world.
    - kylebrown 15y ago
      The implementations of the protocol (the cross-platform bitcoin daemon) have been securely working in the real world since May '09. This track record is what inspires confidence in the protocol. The security of any particular web app related to bitcoin is not the security "of bitcoin". The only reason bitcoin-related web apps are so extensively probed is due to the security of the protocol (bitcoins are valuable because the protocol and its most widespread implementation is believed to be secure). The security track record of any highly targeted industry is generally poor, including banks, fortune 500 companies, credit card processors, and shopping carts. To say that the security of bitcoin-related services is any worse than these is unfair.
      - 15y ago

by kiba 15y ago

tptacek 15y ago

Exasperating. Bitcoin is on the scale of global commerce simply a thought experiment (or, less charitably, a Ponzi scheme). So, of course, anything the modern banking system doesn't fully accomplish is "coming soon" for Bitcoin, right around the corner. Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. No, somehow engineering problems that banks can't solve with tens of millions of dollars of dedicated IT security investment are going to be solved by Bitcoin startups for half-pennies on the dollar. But, at any rate: exasperating though your argument is, it's also a non-sequitor. My point is that banks are dealing with zombie customer machines controlled by malware. Bitcoin falls to that same threat scenario too.

kiba 15y ago
Bitcoin is on the scale of global commerce simply a thought experiment (or, less charitably, a Ponzi scheme). All successful things start small. Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. No, somehow engineering problems that banks can't solve with tens of millions of dollars of dedicated IT security investment are going to be solved by Bitcoin startups for half-pennies on the dollar. I don't claim that bitcoin startup solve problems that banks can't solve, just that I am asking you to compare bitcoin banks with banks, not bitcoin to banks.
- deleted 15y ago
  [deleted]
  - kiba 15y ago
    Once again a Bitcoin advocate asks us to compare a hypothetical fantasy institution with a real-world business, The biggest company in the arena is currently mtgox, which is admittedly a bitcoin exchange, but they also have a merchant solution and function like paypal in some respect. They have a multi factor authentication scheme. There is also a company called bit-pay that acts like a regular payment processor. Also, Gavin is working on adding support for multisignature transaction, which will help everyone in the bitcoin ecosystem. and, presumably, to plow money into Bitcoin accordingly. It doesn't matter as long the argument stand or the reason is sound.
- tptacek 15y ago
  So do the unsuccessful things.
kylebrown 15y ago
> Never mind the fact that virtually all Bitcoin development is done either as a hobbyist project or by fly-by-night operations that end up getting fully compromised. The last (and hopefully only) time a critical vulnerability was found in bitcoin was in May '09: it was exploited on the testnet and then patched. The largest bitcoin exchange did have a security breach in July '11 and suffered a loss of 6k bitcoins, but the rest (most of which were in cold storage) remained secure (at least 424k bitcoins). And in the most recent incident, a couple of popular services lost a combined 50k bitcoins (the users were not affected) because Linode was compromised. Your "fact" is entirely disingenuous. Bitcoin is certainly not a silver bullet to securely using on a compromised machine (and nobody is claiming that it is). Obviously no system will ever 100% protect stupid/compromised users. But many credit card numbers are compromised mid-stream or at a malicious PoS. The public-key nature of bitcoin protects against those attacks.
- tptacek 15y ago
  I like this argument, which tries to separate the "security" of the Bitcoin protocol/cryptosystem from the security of its implementations, so that the protocol can serve as a sort of inverse straw man to deflect attention from the comically poor security track record of Bitcoin as it actually works in the real world.
  - kylebrown 15y ago
    The implementations of the protocol (the cross-platform bitcoin daemon) have been securely working in the real world since May '09. This track record is what inspires confidence in the protocol. The security of any particular web app related to bitcoin is not the security "of bitcoin". The only reason bitcoin-related web apps are so extensively probed is due to the security of the protocol (bitcoins are valuable because the protocol and its most widespread implementation is believed to be secure). The security track record of any highly targeted industry is generally poor, including banks, fortune 500 companies, credit card processors, and shopping carts. To say that the security of bitcoin-related services is any worse than these is unfair.
    - 15y ago