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The transaction history aspect is necessary though. Going back to my analogy, imagine that your bills were just a bill-sized piece of transparent plastic with a

The transaction history aspect is necessary though. Going back to my analogy, imagine that your bills were just a bill-sized piece of transparent plastic with a serial number on it and absolutely no other distinguishing marks; not even a special type of plastic or ink. If someone handed you one, how would you know it's authentic and has any value at all? For Bitcoin, the answer is that you can look up the history of that serial number and verify that it's part of the blockchain, and you know that the blockchain is cryptographically secure and vetted by thousands of bitcoin miners expending a tremendous amount of computing power to make sure every serial id in the chain is valid. That just can't happen without a fully public transaction history going all the way back to the first bitcoin block.

qwerty_asdf 13y ago
...necessary for bitcoin, but problematic from the anonymity perspective. The idea gnawing that the back of my mind is that, with the bitcoin equivalent of carrier-level traffic analysis, where a truly VAST swath of transaction/bitcoin history is known purely by way of the bitcoins themselves, "someone/anyone" might know much more than we would ordinarily expect them to, given our commoner's understanding of the total network state (in non-real-time) as an ordinary, layman participant at the ground level. Worse still, is the idea that such large-scale network awareness would then enable "parallel evidence construction" or bizarre trading strategies for market manipulation, denying any understanding to participants that such problems even exist. This is not just a problem for criminals, but also from a large-scale trading perspective, when approaching a global population of participants where many, many entry-level players have serious disadvantages, compared to higher-order traders. Instinctively, to me at least, the barrier to manipulating bitcoin value feels drastically lower than traditional currencies. Maybe these sorts of baked-in fundamentals play a role?

qwerty_asdf 13y ago

...necessary for bitcoin, but problematic from the anonymity perspective. The idea gnawing that the back of my mind is that, with the bitcoin equivalent of carrier-level traffic analysis, where a truly VAST swath of transaction/bitcoin history is known purely by way of the bitcoins themselves, "someone/anyone" might know much more than we would ordinarily expect them to, given our commoner's understanding of the total network state (in non-real-time) as an ordinary, layman participant at the ground level. Worse still, is the idea that such large-scale network awareness would then enable "parallel evidence construction" or bizarre trading strategies for market manipulation, denying any understanding to participants that such problems even exist. This is not just a problem for criminals, but also from a large-scale trading perspective, when approaching a global population of participants where many, many entry-level players have serious disadvantages, compared to higher-order traders. Instinctively, to me at least, the barrier to manipulating bitcoin value feels drastically lower than traditional currencies. Maybe these sorts of baked-in fundamentals play a role?