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This is a surprisingly good analysis that strengthens the argument that a Government agency created Bitcoin (Much like what Paul Graham suggested) The main poi

This is a surprisingly good analysis that strengthens the argument that a Government agency created Bitcoin (Much like what Paul Graham suggested) The main point is the same one that PG brought up, that the transaction graph is very easy to follow and if the gatekeepers are compromised then most of transactions become transparent. A novel point they make is that some group (probably the creators of Bitcoin) control 25% of the money supply. I have not read the paper yet so cannot comment but I was under the impression 95% of Satoshi's coins have never moved since being mined. (If he does control them at all) Of course if they do control 25% of all the circulated Bitcoins this would forever stunt its growth as that actor would always be far too powerful. Whilst I do not believe a Government created Bitcoin I welcome these articles that counter my own views. This also re-emphasizes the work that needs to go into coinjoin or zerocoin implementations as soon as possible. Also we need to seriously fix the 7 tx/sec limit.

nwh 13y ago
>Bitcoin is, by design, highly vulnerable to network analysis. By design as in, that's the only way the network could conceivably work. Each node must be able to verify that the chain is intact and valid, otherwise they would have to be trusting a third party. There's ways of obfuscating this anyway, which seem to work quite well in practise. > This is a surprisingly good analysis that strengthens the argument that a Government agency created Bitcoin It's not really. If the US government were to create something like this, they wouldn't have risked releasing something as ridiculously buggy as the original Satoshi client. You're talking massive remote exploits, people able to make their own coins due to an integer overflow, just chaos in the code. It's truly miraculous that it even took off at all, and the developers are still trying to fix the issues that Satoshi unknowingly introduced. Bitcoin was not the work of a skilled team. >I was under the impression 95% of Satoshi's coins have never moved since being mined That's correct, though you can't even verifiably say that all the coins were minted by Satoshi. I doubt they'll ever move, given that Satoshi made it very clear that remaining part of the community is a bad idea. In their shoes, I would have been mining to a bit bucket, which I imagine is the case here. > This also re-emphasizes the work that needs to go into coinjoin or zerocoin implementations as soon as possible. Coinjoin is well and good, but zerocoin is a no show at the moment. It's immature, creates massive signatures, and is completely untested. There's no way it would ever make it's way into the mainstream client in it's current state, and the developers know that too. > Also we need to seriously fix the 7 tx/sec limit. I'd go close to calling that one a myth. There's really nothing stopping 7 transactions a second at the moment, in fact it's intended to be tight for block space in order to create a market in which people battle for transaction fees. There's also nothing to stop the block limit from just being increased, 1MB is just arbitrary at the moment.
- josephagoss 13y ago
  > Bitcoin was not the work of a skilled team. This is refreshing to hear, however the Government does not have a history of writing good code (excluding NASA) I still feel like the Government argument could be correct. > I'd go close to calling that one a myth Well the limit is based on size, and 7tx/sec assumes an average transaction I think. > in fact it's intended to be tight for block space in order to create a market in which people battle for transaction fees I remember reading Satoshi did not intend for limited blockchain space and envisioned 500GB blocks. > 1MB is just arbitrary at the moment. A hard fork will be required, this will not be an issue if no one complains.
  - bunderbunder 13y ago
    > the Government does not have a history of writing good code I'd love to hear more about that, because it goes against my own experience. (And I'll go ahead and disclaim that I'm obviously speaking anecdotally here.) Whenever I've run into software that was developed by the US government it's generally been pretty competent. No worse, and maybe a little better, than what I'm used to seeing come out of the companies I've worked with. Certainly better than the stream of epic fails that seems to characterize what results from outsourcing to private contractors.
    - gknoy 13y ago
      Partly that may be because they can (in theory) work closer to the true customer, rather than having an additional contract/specification-based interface to getting things made. When you don't find out for six months that you completely misunderstood the client's needs, it's hard to build good stuff -- frustrating for the client, and for the developers. If, however, you ARE your own client, such as writing research code or simulation/test code, you likely have a clearer idea of what needs to be done.
    - celticninja 13y ago
      it depends on who does what, if the people that want/need/use the code are responsible for writing it then I woudl agree, if you have a different department/wing/group writing the code then what you end up with may not be useable by the end user or may not be as useful anyway. If you add in another step where lots of disparate groups have input i.e. impse a set of requirements, usually indepdent of one another, then what you get left with is an expensive, unworkable, useless piece of spftware that everyone is forced to use until someone else decide to have a crack at improving it. source: i have worked for govt.
ianso 13y ago
I didn't know that PG suggested something similar, thanks for the pointer :-)
mcphilip 13y ago
>A novel point they make is that some group (probably the creators of Bitcoin) control 25% of the money supply. I have not read the paper yet so cannot comment but I was under the impression 95% of Satoshi's coins have never moved since being mined. From Table 7 on page 11 of the linked paper: Entity ID | Accumulated Incoming BTC's | Number of Transactions A | 2,886,650 | 246,012 B | 2,206,170 | 477,526 //Mt. Gox Since there were 9 million in the address graph, I assume that the 25% remark refers to unidentified Entity A in this table. However, I did not see any claim in the paper that there was evidence that this unnamed entity was trying to hide this accumulation. Does anyone know why this claim was made in the article?
- ianso 13y ago
  Yup, because I misread the paper :-/ I thought it also stated that entity A had done large amounts of churning, which it hasn't. I'll fix that, thankyou...
feral 13y ago
>The main point is the same one that PG brought up, that the transaction graph is very easy to follow and if the gatekeepers are compromised then most of transactions become transparent. I agree with that point, but where did PG say that? Its not in his post here: https://news.ycombinator.com/item?id=5547423 https://news.ycombinator.com/item?id=5547423
dobbsbob 13y ago
Plenty of people on the cryptography mailing list mined the first coins like Hal Finney who wrote he is leaving them for his kids which is why they havent moved. Satoshi buggered off the day Gavin announced he was presenting BTC to the CIA seems odd he wouldnt stick around and try to influence development if he was a gov agent. His opsec was perfect though, which could mean he was an NSA or GCHQ employee doing this as a secret side project for himself. Nobody has had better opsec than Satoshi not once did he talk about anything personal even in PMs to Gavin or leave indicators to analyze. Somebody even scanned for every unique word Satoshi used to match it up to existing whitepapers and mailing lists, nothing turned up
- celticninja 13y ago
  yeah, the one thing that makes me think this was the work of one person is the fact that a group, even a close knit group of NSA/CIA/GCHQ operatives could not produce, test and release something liek this without one of them making an error. I assume that satoshi thought through the production and release of this software well in advance of actually doing it, i.e. never suggesting it on a forum account, never testing or discussing it with anyone until he was soewhat ready to go. However his posting to the cypherpunks group does make me think he was at least a lurker on there before he signed in as satoshi, hence his decent OpSec.
  - dobbsbob 13y ago
    The gateway monitoring argument is also pretty feeble since how are they going to extract ID scans or other info from worldwide gateways or p2p sales. Sure bitcoin is risky if using a major exchange in a western country but good luck getting info on a trade from a Russian exchange, or IRC exchanger connected via Tor who lives in Vietnam
- gwern 13y ago
  > Somebody even scanned for every unique word Satoshi used to match it up to existing whitepapers and mailing lists, nothing turned up Really? Who was that, I don't recall ever hearing about a real textual analysis being done.
fleitz 13y ago
The entire worth of all bitcoins is just north of $50 billion. It wouldn't be very difficult for any soveriegn to gain control of 25% of that market. Whether government created bitcoins is a moot point, knowing the answer to this question doesn't mean anything. The question is whether bitcoins provide a superior environment for transacting business when compared to alternatives.
blauwbilgorgel 13y ago
If a government created Bitcoin wouldn't China be more likely than the US?

nwh 13y ago

>Bitcoin is, by design, highly vulnerable to network analysis. By design as in, that's the only way the network could conceivably work. Each node must be able to verify that the chain is intact and valid, otherwise they would have to be trusting a third party. There's ways of obfuscating this anyway, which seem to work quite well in practise. > This is a surprisingly good analysis that strengthens the argument that a Government agency created Bitcoin It's not really. If the US government were to create something like this, they wouldn't have risked releasing something as ridiculously buggy as the original Satoshi client. You're talking massive remote exploits, people able to make their own coins due to an integer overflow, just chaos in the code. It's truly miraculous that it even took off at all, and the developers are still trying to fix the issues that Satoshi unknowingly introduced. Bitcoin was not the work of a skilled team. >I was under the impression 95% of Satoshi's coins have never moved since being mined That's correct, though you can't even verifiably say that all the coins were minted by Satoshi. I doubt they'll ever move, given that Satoshi made it very clear that remaining part of the community is a bad idea. In their shoes, I would have been mining to a bit bucket, which I imagine is the case here. > This also re-emphasizes the work that needs to go into coinjoin or zerocoin implementations as soon as possible. Coinjoin is well and good, but zerocoin is a no show at the moment. It's immature, creates massive signatures, and is completely untested. There's no way it would ever make it's way into the mainstream client in it's current state, and the developers know that too. > Also we need to seriously fix the 7 tx/sec limit. I'd go close to calling that one a myth. There's really nothing stopping 7 transactions a second at the moment, in fact it's intended to be tight for block space in order to create a market in which people battle for transaction fees. There's also nothing to stop the block limit from just being increased, 1MB is just arbitrary at the moment.

josephagoss 13y ago
> Bitcoin was not the work of a skilled team. This is refreshing to hear, however the Government does not have a history of writing good code (excluding NASA) I still feel like the Government argument could be correct. > I'd go close to calling that one a myth Well the limit is based on size, and 7tx/sec assumes an average transaction I think. > in fact it's intended to be tight for block space in order to create a market in which people battle for transaction fees I remember reading Satoshi did not intend for limited blockchain space and envisioned 500GB blocks. > 1MB is just arbitrary at the moment. A hard fork will be required, this will not be an issue if no one complains.
- bunderbunder 13y ago
  > the Government does not have a history of writing good code I'd love to hear more about that, because it goes against my own experience. (And I'll go ahead and disclaim that I'm obviously speaking anecdotally here.) Whenever I've run into software that was developed by the US government it's generally been pretty competent. No worse, and maybe a little better, than what I'm used to seeing come out of the companies I've worked with. Certainly better than the stream of epic fails that seems to characterize what results from outsourcing to private contractors.
  - gknoy 13y ago
    Partly that may be because they can (in theory) work closer to the true customer, rather than having an additional contract/specification-based interface to getting things made. When you don't find out for six months that you completely misunderstood the client's needs, it's hard to build good stuff -- frustrating for the client, and for the developers. If, however, you ARE your own client, such as writing research code or simulation/test code, you likely have a clearer idea of what needs to be done.
  - celticninja 13y ago
    it depends on who does what, if the people that want/need/use the code are responsible for writing it then I woudl agree, if you have a different department/wing/group writing the code then what you end up with may not be useable by the end user or may not be as useful anyway. If you add in another step where lots of disparate groups have input i.e. impse a set of requirements, usually indepdent of one another, then what you get left with is an expensive, unworkable, useless piece of spftware that everyone is forced to use until someone else decide to have a crack at improving it. source: i have worked for govt.

ianso 13y ago

I didn't know that PG suggested something similar, thanks for the pointer :-)

mcphilip 13y ago

>A novel point they make is that some group (probably the creators of Bitcoin) control 25% of the money supply. I have not read the paper yet so cannot comment but I was under the impression 95% of Satoshi's coins have never moved since being mined. From Table 7 on page 11 of the linked paper: Entity ID | Accumulated Incoming BTC's | Number of Transactions A | 2,886,650 | 246,012 B | 2,206,170 | 477,526 //Mt. Gox Since there were 9 million in the address graph, I assume that the 25% remark refers to unidentified Entity A in this table. However, I did not see any claim in the paper that there was evidence that this unnamed entity was trying to hide this accumulation. Does anyone know why this claim was made in the article?

ianso 13y ago
Yup, because I misread the paper :-/ I thought it also stated that entity A had done large amounts of churning, which it hasn't. I'll fix that, thankyou...

feral 13y ago

>The main point is the same one that PG brought up, that the transaction graph is very easy to follow and if the gatekeepers are compromised then most of transactions become transparent. I agree with that point, but where did PG say that? Its not in his post here: https://news.ycombinator.com/item?id=5547423 https://news.ycombinator.com/item?id=5547423

dobbsbob 13y ago

Plenty of people on the cryptography mailing list mined the first coins like Hal Finney who wrote he is leaving them for his kids which is why they havent moved. Satoshi buggered off the day Gavin announced he was presenting BTC to the CIA seems odd he wouldnt stick around and try to influence development if he was a gov agent. His opsec was perfect though, which could mean he was an NSA or GCHQ employee doing this as a secret side project for himself. Nobody has had better opsec than Satoshi not once did he talk about anything personal even in PMs to Gavin or leave indicators to analyze. Somebody even scanned for every unique word Satoshi used to match it up to existing whitepapers and mailing lists, nothing turned up

celticninja 13y ago
yeah, the one thing that makes me think this was the work of one person is the fact that a group, even a close knit group of NSA/CIA/GCHQ operatives could not produce, test and release something liek this without one of them making an error. I assume that satoshi thought through the production and release of this software well in advance of actually doing it, i.e. never suggesting it on a forum account, never testing or discussing it with anyone until he was soewhat ready to go. However his posting to the cypherpunks group does make me think he was at least a lurker on there before he signed in as satoshi, hence his decent OpSec.
- dobbsbob 13y ago
  The gateway monitoring argument is also pretty feeble since how are they going to extract ID scans or other info from worldwide gateways or p2p sales. Sure bitcoin is risky if using a major exchange in a western country but good luck getting info on a trade from a Russian exchange, or IRC exchanger connected via Tor who lives in Vietnam
gwern 13y ago
> Somebody even scanned for every unique word Satoshi used to match it up to existing whitepapers and mailing lists, nothing turned up Really? Who was that, I don't recall ever hearing about a real textual analysis being done.

fleitz 13y ago

The entire worth of all bitcoins is just north of $50 billion. It wouldn't be very difficult for any soveriegn to gain control of 25% of that market. Whether government created bitcoins is a moot point, knowing the answer to this question doesn't mean anything. The question is whether bitcoins provide a superior environment for transacting business when compared to alternatives.

blauwbilgorgel 13y ago

If a government created Bitcoin wouldn't China be more likely than the US?