Bitcoin hits $785 with a little help from Bernanke ...

Ben Bernanke’s letter to Congress: Bitcoin and other virtual currencies “may hold long-term promise."

submitted by rstevens94 to business [link] [comments]

Ben Bernanke’s letter to Congress: Bitcoin and other virtual currencies “may hold long-term promise.”

Ben Bernanke’s letter to Congress: Bitcoin and other virtual currencies “may hold long-term promise.” submitted by d3sperad0 to countermine [link] [comments]

Ben Bernanke’s letter to Congress: Bitcoin and other virtual currencies “may hold long-term promise.”

Ben Bernanke’s letter to Congress: Bitcoin and other virtual currencies “may hold long-term promise.” submitted by rstevens94 to politics [link] [comments]

I won't ask, "What about Bitcoin?"

I won't ask, submitted by Petrocrat to Bitcoin [link] [comments]

Even by I.R.S. standards, the recent ruling on bitcoin flirts with nonsensical non-logic in a way that is truly shocking to an outsider. Govt officials have called bitcoin "digital currency" thousands of times, not once have they called it "digital property".

Really astonishing. For months, including the Senate hearing and the Treasury Department's own published documents on bitcoin always refer to it as a "virtual currency," "digital currency," or my favorite "convertible virtual currency." Don't take my word for it. Search through publicly available federal government documents that mention or address bitcoin in any way. It's always discussed as a convertible electronic currency, which it is, not as property.
If the government views bitcoin as property - for taxation purposes the same as selling ice cream sandwiches out of an ice cream truck - why was this not a topic broached during the Senate hearing? Why did former Fed chairman Ben Bernanke in his letter refer to "virtual currency" several times, and "virtual property" not once. His successor, Janet Yellen, has had an equally sane approach toward bitcoin.
Even by the sometimes byzantine logic of modern tax agencies, the IRS is simply wrong.
If mining Bitcoins is self employment, so is jerking off to porn.
If Bitcoin is primarily "property" and not currency, then why the focus on KYC/AML compliance? It's not money according to the IRS. And why the need for money transmitter licenses? And why is New York State trying to regulate Bitcoin if it's just property? Lawsky's job is over before it even begins, if this nonsensical IRS classification is not challenged and revised.
Please don't tip me, I don't want the burden of having your property thrown at me unsolicited over these inter web tubes. Thank you.
submitted by CryptoDonDraper to Bitcoin [link] [comments]

Censored by self serving scammer dirtbag Anti- Free Speech r/Bitcoin hypocrites: A proposal for a simple, inexpensive, and effective way to end Chinese Miner dominance of Bitcoin.

Edit to add: The fine folks in BitcoinNorthKorea relented and took this thread out of the memory hole for consumption by the muggles. It is here.
Start original thread:
Simply start embedding pro Falun Gong, Tiananmen Square protests of 1989, freedom of speech, Taiwan independence, Tibetan independence movement, etc. literature into the Blockchain. It would probably be best to put this literature in Chinese, as well as English. Contacting some of the various Chinese dissident groups and having them directly participate will add legitimacy and fuel the flames of outrage the tyrannical Chinese government would feel at this attack upon their censorship of pro-freedom information now bypassing the Great Firewall of China and making them look like fools. Inititally the Chinese miners will likely try to exclude transactions with such information, and they will still get through when mined by non-Chinese Miners. The Chinese Government will have to force the miners to introduce a fork to scrub that content from the Blockchain or shut down, and they will choose the fork option. Then just don't use their new coin.
They will have their new Alt China-BitmainCoin, and Bitcoin will remain the same as it ever was. It would also then exclude them from mining the original Bitcoin Blockchain that contains the illegal (In China) literature in it, so it would effectively remove the threat of attacks on the old chain by the massive amount of mining hardware centralized in China.
Here you go: Looks like it is about a penny a letter to use this service, cheaper or even free if you have the where with all to do it yourself and attach the messagesI think. Images too, of course, the obvious one would be the outlawed Tank Man pictures. Even if the Chinese government decides for whatever reason to turn a blind eye to this pro-freedom information being distributed via the Bitcoin blockchain on nodes operated by Chinese Miners, you will still be doing the free world and Bitcoin a service by showing Bitcoin to be a true beacon of Free Speech in an ever darkening world and only be out a days lunch money for doing so. Why let the Chinese Miners dictate their vision of Bitcoin and reap profits taken from you when you have the means to stop them?
End of thread rejected by hypocrite Bitcoin. How many threads are there on that sub lauding the virtues of Bitcoin as a vehicle of Free Speech that can not be stopped by governments?
How many threads are there on that sub lauding the virtues of Bitcoin as a vehicle of Free Speech that can not be stopped by evil governments or banksters? Here is a blog exclaiming the virtues of freedom of expression enabled with the" immutable" Bitcoin Blockchain and how wonderful it is that Nelson Mandela is immortalized on the Bitcoin Blockchain, along with many more examples like Wikileaks information. And yet using this wondrous weapon against tyranny to fire the Chines Miners from Bitcoin, and score a win for Freedom of Speech at the same0 time is immediately rejected. Typical faux Libertarian Bitcoin bullshit hypocrisy in action, all any of them care about is how much they can rip off from the next sucker, the pro-free speech spiel is just another way to con more suckers into buying a ride on the Bitcoin ShitZeppelin. I would expect the sites making it easy to embed and read text and images on the Blockchain start enjoying some real Bitcoin Love in the form of DDOS attacks, and/or bribes from Anti Free Speech Bitcoin hypocrites to shut down and protect their precious fucking Bitcoin Scam.
Edit: It took all of 5 minutes of shame for the fine freedom loving folks in Bitcoin to relent and let the thread through to the muggles after holding it in the memory hole for a couple of hours.
submitted by Barkey_McButtstain to Buttcoin [link] [comments]

An Open Letter to the Neo team, Da Hongfei and City of Zion

Hi everyone! Before we begin, this is a long post and I will like to thank everyone who is gracious enough to spend their time and effort in reading. I am writing an open letter to the Neo team, Neo CEO Da Hongfei and the Neo Community team City of Zion in the hopes that they can consider a burning idea that came up in my mind.
Firstly, to introduce myself, I am a huge fan of Neo (hence the nickname). I came to know about Antshares earlier this June and has been following the coin ever since. I believe that Neo has huge potential in bettering people’s lives. However, I also think that the technology is currently some distance away from being able to do that. In the cryptocurrency world where days and weeks feel like months and years, I believe that speed is of the essence and that coins with a first mover advantage in their respective fields will have a distinct advantage over the rest of their competition.
As such, I believe that at status quo, Ethereum, instead of Neo, is poised to become a world leader in terms of smart contracts. Already, they are coming up with the Metropolis and Byzantium updates to their system, and it is not difficult to see that they will continue to upgrade themselves as time goes. With the backing of the Enterprise Ethereum Alliance(EEA), the trajectory of their growth looks to outpace that of Neo. The debate on whether both Ethereum and Neo can co-exist in this space is one that we will save for another day. Instead, what I am about to propose is, in my opinion, a possible strategic collaboration that will quicken the pace of Neo, expand its resources and put them on equal footing with Ethereum.
As we all know, Neo is working towards the vision of a Smart Economy, where Digital Assets meet Digital Identities and Smart Contracts. Taken from the Neo website:
“In this new Smart Economy, a paradigm shift from the “Internet of Information” to an “Internet of Value” is taking place. This will allow for seamless integration of the traditional economy and digital economy, facilitating the free flow of all assets. Exchange of value and economic activities are provided in a trustless mode. The rules, policies, and organizations of traditional society will be rightfully transparent and fair. This is an “Internet of Order” and the ultimate goal of Neo Smart Economy.”
It’s a compelling vision. However, the downside that I foresee is that the goal, being a very tall order, will take a long time to achieve, in which case by then Neo may be displaced by new ideas or technologies. Progress as a lone wolf is tough and lonely. However, progress as a group will bring about much more efficiency through delegation, specialization and leverage. This brings about my next point: Partnerships.
As far as I know, Neo already has several partnerships ongoing / underway: Bancor, Coindash, Agrello, Elastos and Red Pulse, which only just very recently concluded a hugely successful ICO (also having the honour of being the first ICO hosted on the Neo blockchain). However, I believe many will agree with me that these partnerships do not even come close to the level of the EEA of Ethereum. This is where I want to introduce a very interesting blockchain project that I have come across recently: ChainLink.
The ChainLink Network is a fully decentralised blockchain middleware that provides Smart Contracts with data, bank payments and access to APIs (Application Programming Interface). I am unable to explain their tech very well, so for the more gifted, tech savvy redditors, please feel free to add or correct anything that I have to say. As far as I understand, ChainLink is trying to solve the problem where Smart Contracts are unable to connect with key external resources like off-chain data and APIs. These external resources are information and data that we currently receive in our everyday lives, for example, weather forecasts, traffic conditions or even football match results.
So let’s say there is a Smart Contract deployed on the Neo blockchain to, for example, retract your clothes hangers when it rains. In order to execute correctly, it will require external data in the form of the weather forecast in the local area. Instead of coming up with ways to do it all on their own on the Neo blockchain, developers can instead choose to employ ChainLink to access this external data, saving time and effort, as well as using much more reliable information than they will be able to source on their own. Currently, from their website, people are able to create ChainLinks on Ethereum, Town Crier and Bitcoin.
So, why will ChainLink want to work with Neo if they are already working with the Ethereum blockchain? Unfortunately, I am not affiliated to ChainLink in any way, and this will not be a question that I will be able to answer. All I am proposing is for Neo / Da Hongfei to look into a possible partnership, in which I have no concrete answers for. However, I do know of possible reasons in which the different organisations might want to come and work together with each other.
Firstly, take a look at this:
This was Vitalik dissing ChainLink openly on twitter. Now, if my company runs Oracle networks and someone high profile comes out to purposefully non-endorse my product and say that my company is not even worth $32m (implied meaning), I will be pretty pissed off. I don’t know about you, but last I checked CEOs are humans.
Secondly, ChainLink is a fairly new ICO and it will do well to form strong partnerships with other relevant parties, and Neo’s position as a frontrunner in China as well as its reputation (for good or for bad) as China’s Ethereum will definitely shore up its credibility to prospective partners and investors.
Thirdly, from the ChainLink website, you can see that they are proud to be working with SWIFT on their own SWIFT Smart Oracle. Why is this important? SWIFT (Society for Worldwide Interbank Financial Telecommunication) has long held a monopoly for interbank payments, but its position is starting to get threatened by newcomer Ripple (XRP). In fact, SWIFT is holding its annual SIBOS conference on the 16-19th of October later this month, and Ripple has decided to gatecrash the party by holding its own conference called SWELL, on the 16-18th of October. It is common knowledge that Ripple seems to have superior technology versus SWIFT, and if SWIFT wants to maintain its power and position, it will definitely need to start getting into the blockchain arena. Take a look for yourself, the SIBOS program list consists of an item in which (ChainLink) will be presenting a live demo of a Proof of Concept.
Now, whats in it for Neo? If Neo manages to get into close collaboration with ChainLink, it will have access to technology that speeds up its game exponentially. By outsourcing the channel that receives external, off-chain, real time data, they will be able to focus their time, energy and money on other strategic areas. SWIFT works with over 11,000 banks, and in the event that ChainLink becomes a partner of SWIFT, Neo becoming a partner with ChainLink will indirectly make them partners of SWIFT as well. Now, let me remind you what Neo is up against.
In summary, a Neo – ChainLink – SWIFT partnership will be a win / win / win situation for all parties involved. It tilts the balance of Neo vs ETH, as well as SWIFT vs Ripple. In case you are wondering why SWIFT will want to partner up with blockchain companies that are a fraction of its own size, look up Ripple’s SWELL conference and you will see that former US Federal Reserve System chairman Ben Bernanke, as well as the freaking inventor of the World Wide Web, Tim Berners are both going to be there as keynote speakers. They need blockchain just as much as blockchain needs partnerships and resources. I like to think of Neo’s Smart Contracts as cars while ChainLink serves as the road for the cars. Imagine driving cars without roads, will we still want to travel around in cars? You get the point.
Please upvote this thread, comment and share this post as much as you can. All I want is for Neo / Da Hongfei / City of Zion to just consider the possibilities of collaboration with ChainLink. I am very excited for the world moving forward, and I just hope to make a small contribution to the world by casting this little seed of possibility in the great minds of the leading thinkers of blockchain.
TLDR – Upvote this thread and spread the love and get Da Hongfei to notice this post <3
submitted by Ants2Dragons to CryptoCurrency [link] [comments]

Bernanke never said that "Bitcoin may hold long-term promise", and other bitcoin quotes corrected with sources

During the course of my research, I made a collection of Bitcoin quotes that I could use in different publications.
Many "famous people bitcoin quotes" are false, misquoted and without sources. Using those quotes is bad for everyone.
The first, and most horribly fasle quote, is Bernanke's famous quote: "Bitoin may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”
1) The quote is actually from Alan Blinder
2) The quote is from 1995
3) The quote has nothing to do with Bitcoin
This is the full quote:
Dear Senators: Thank you for your recent inquiry regarding virtual currencies. As you noted, virtual currencies have been receiving increased attention from U.S. authorities over the past several months.
Historically, virtual currencies have been viewed as a form of “electronic money” or area of payment system technology that has been evolving over the past 20 years. Over time, these types of innovations have received attention from Congress as well as U.S. regulators. For example, in 1995, the U.S. House of Representatives held hearings on “the future of money” at which early versions of virtual currencies and other innovations were discussed. Vice Chairman Alan Blinder’s testimony at that time made the key point that while these types of innovations may pose risks related to law enforcement and supervisory matters, there are also areas in which they may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.
Read more:
I know some of you already know that this quote is badly cited, but believe me it is being used by every journalist and "expert" out there (google Bernanke bitcoin quote, you'll se that I'm right).
EDIT: Bernanke is not paraphrasing Blinder in order to support a positive / negative opinion of Bitcoin. He quotes Blinder in the introduction of his letter as a way to show that monetary innovations was already a topic of interest back in 1995
There was another post with Bitcoin quotes from famous people here:
Many of these quotes were misquoted, false or without references. I took the liberty to create a legit quotes list with sources:
"I think Bitcoin is a techno tour de force." - Bill Gates, Founder of Microsoft Fox News, May 6, 2013 Original source:
“I gave a talk back in November of ‘99 on […] how encrypted money was going to change the world. I do think bitcoin is the first one of these that has the potential to do something like that. - Peter Thiel, Co-Founder of Paypal. Secondary source:
“It’s fascinating to watch what’s happened with Bitcoin. Congress has just been spending a week looking at it, they might bring some regulations, but I just hope that it will not stifle innovations of new tech novalties like Bitcoin” Sir Richard Branson, Novembre 22th 2013 Original source:
“I think the fact that within the Bitcoin universe an algorithm replaces the functions of [the government] … is actually pretty cool” Al Gore, former US vice president and winner of the Nobel Peace prize Secondary source:
“Virtual currency systems, so long as they comply with applicable anti money-laundering and money transmission laws and regulations are not inherently illegal and they can be appealing to consumers because they can provide cheap, efficient and convenient means to transfer currency.” Mythili Raman of the Department of Justice Criminal Division Original source:!65405E2A-CD8B-4B70-B8DD-9E7A19D05A61
“Bitcoin is the most important invention in the history of the world since the internet. Roger Ver, CEO of Original source:
“Three eras of currency: Commodity based, e.g. Gold., Politically based, e.g. Dollar, Math based, e.g. Bitcoin” Chris Dixon, Personal investor in technology startups Original source:
"Bitcoin is the beginning of something great: a currency without a government, something necessary and imperative.” - Nassim Nicholas Taleb, Ph.D statistician, author, and advisor to the IMF Original source:
"Bitcoin is going to be a big player in the future of the exchange of goods and services" Jennifer Shasky Calvery, the director of the Treasury Department’s Financial Crimes Enforcement Network Original source:
“The decision to bring virtual currency within the scope of our regulatory framework should be viewed by those who respect and obey the basic rule of law as a positive development for this sector. It recognizes the innovation virtual currencies provide, and the benefits they might offer society,” Jennifer Shasky Calvery, the director of the Treasury Department’s Financial Crimes Enforcement Network. Original source:
"A number of smart people both inside and outside of government view bitcoin as a major emerging issue that is deserving of our attention" - Senator Tom Carper (D) Original source:
“It [Bitcoin] is a huge, huge, huge deal […] it is gold 2.0” - Chamath Palihapitiya, venture capitalist and former Facebook executive Original source:
"Bitcoin may be the TCP/IP of money." - Paul Buchheit, Creator of Gmail
“We have elected to put our money and faith in a mathematical framework that is free of politics and human error.” - Tyler Winklevoss, Winklevoss Bitcoin Trust Original source:
submitted by FrancisPouliot to Bitcoin [link] [comments]

A list of people who haven't completely dismissed Bitcoin

This is not an attempt to convince anyone why Bitcoin will succeed, but merely to show that there exist reasonably intelligent people who believe there's a chance.
Paul Graham Co-founder of Y Combinator
I am very intrigued by Bitcoin. It has all the signs. Paradigm shift, hackers love it, yet it's derided as a toy. Just like microcomputers.
Peter Thiel Co-founder of PayPal His VC Founder's Fund led a $2m invesetment in BitPay
It is worth thinking about money as the bubble that never ends. There is this sort of potential that bitcoin could become this new phenomenon
Exclusive: Peter Thiel on Bitcoin
Eric Schmidt Google Chairman and former CEO
Bitcoin is a remarkable cryptographic achievement and the ability to create something which is not duplicable in the digital world has enormous value. It’s very hard to do and it’s incredibly useful for many many computer applications. … The Bitcoin architecture, literally the ability to having these ledgers that can’t be replicated is an amazing advancement. A lot of businesses will be built on top of that... Eric Schmidt: The technology behind bitcoin has enormous value
Sir Richard Branson Founder of Virgin Group
I have invested in some bitcoins myself, and find it fascinating how a whole new global currency has been created. For people who can afford to invest a little in bitcoins, it’s worth looking into.
Bitcoins in space
Kevin Rose Founder of Digg
Those of us that understand that Bitcoin has the potential to change money forever. If you believe that a decentralized digital currency, free from government corruption and controlled by the masses is the future – then you’re in this camp. This is no easy road, there are going to be sell-offs, attempted regulation, and major unforeseen disasters. It’s not for the faint of heart. We could and probably will lose everything, but IF we pull this off, the results will be unlike anything we’ve ever seen.
Bitcoin is falling, again, here is why it really doesn't matter.
Ben Bernanke Former chairman of the U.S. Federal Reserve
In letter to Senate committee “to explore potential promises and risks related to virtual currency for the federal government and society at large”:
..while these types of innovations may pose risks related to law enforcement and supervisory matters, there are also areas in which they may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system
full letter to the Senate committee
Paul Buchheit Creator and lead developer of GMail
Bitcoin may be the TCP/IP of money.
Alexis Ohanian Co-founder of reddit, investor in Coinbase and Buttercoin
I am cautiously optimistic about it — but I am intrigued
Reddit co-founder Alexis Ohanian: ‘I’m cautiously optimistic about Bitcoin’


Union Square Ventures Select portfolio: Twitter, Twillio, Kickstarter, Meetups Investor in Coinbase
We believe that Bitcoin represents something fundamental and powerful, an open and distributed Internet peer to peer protocol for transferring purchasing power. It reminds us of SMTP, HTTP, RSS, and BitTorrent in its architecture and openness
Y Combinator Investor in Coinbase and Buttercoin Select portfolio: Airbnb, Dropbox, reddit
Google Ventures Investor in Buttercoin Select portfolio: Nest, Uber, 23andMe
edit: do what you want with the list, copyrights of quotes and trademarks belong to respective owners, anything else is cc0
Kind of wish people could just edit it like a wiki as well
submitted by enkideridu to Bitcoin [link] [comments]

Gavin is not a politician + My solution to the block cap problem

There has been a lot of discussion lately surrounding the future problems of the cap on the network. This has led to Gavin proposing a hard fork. The problem is that this approch is like a polician forcing his will on the people rather than an economic democratic process (voting with your money). Luckily the network is designed to go against these archaic forms of ruling so my guess is he will not reach concensus.
Furthermore I also discourage others to just accept the change proposed by Gavin based on the fact that he is one man with one proposal.
The problem with his solution is it is formulated by the mind of a polician:
“Something must be done” -> “this is something” therefore “this must be done”.
This is not the way a free society works and therefore this solution will and should not be chosen by the network.
So what should be done?
Currently nothing, as there is currently no problem we are only reaching 70% of the block cap which means right now no-one in the network has any reason to upgrade.
Instead the bitcoin foundation should use its time on helping and assisting other programmers developing their ideas for changes to the network (to be implemented, once there is a problem). What they shouldn't be doing is trying to enforce their idea of change and word it like its this or nothing. In the old world of rulers this would be appropiate, but not in free sociaty.
Now I don't think there is a reason to fire Gavin he is a fine figurehead and a by all means he should be the one writing about new ideas and such, however as a paid programmer he should work to simplify and ease the readability of the code so the community can easily propose new changes.
Just to give an example currently the bitcoin protocol is in the same project on the github repo as the bitcoin foundations own client, meaning that to propose changes to the protocol means you need to go through a lot of unnecessary code just to get to the meat of it. This to me is something that needs to be addressed why are these two the same? This makes it harder than it already is to make proposals of the code (suggestion of changes). Not only that but has anyone tried building it on windows (good luck) I spent 3 days getting it to work with visual studio and by the end I just quit and used a c# implementation (by someone else) instead.
These I things that needs improvement right now, and if the bitcoin foundation can't provide that I suggest we start paying someone else that can.
To end my rant I'd like to provide my solution based on how I see the problem.
My proposal to solve the future block chain problem
To me it seems like a bad solution to simply increase the current block size as these would become mega blocks of data which would be hard to manage. In my experiance it is always better to have more small pieces than than fewer large pieces.
Think of a mailman that only hands out mail once a week, right now he has no problems carrying the mail as there are only a few letters, but all of a sudden Ikea starts sending out ads everyday of the week by the end of the week the pile of ads is so huge that the even though he brought a giant trailer to move it around in, he still can't carry it all. However if he instead just delivered the mail everyday then the amount of work would be managable over an entire week.
Therefor I think the way to solve the problem is:
When the last block reaches maximum cap (1 mb) then the 2 next block produced has half the difficulty and gives half the reward. If the 2 blocks doesn't reach the cap of 1 block then it scales back. This scaling up and down can occur as much as is need, except we still have an upper cap of 1 block per 10 min.
TL;DR Gavin is not bernanke and shouldn't be treated as such; Bitcoin foundation focus should be on code readability improvements and helping; Solution could be create more blocks when the network needs more transactions
submitted by enzain to Bitcoin [link] [comments]

Letter to the portfolio manager of a relation of mine

This is a letter I have sent to a relation of mine's portfolio manager. This is an obvious throwaway and I really am not interested in giving specifics. I'm just reproducing it here so that if others are thinking of approaching their managers, they have something as a basis for their conversation.
I am [a relation to your client]. I think that we may have spoken once in the past regarding aspects of the portfolio for [your client].
[They have] asked me to write you about some of the developments with respect to Bitcoin as a diversification option for this portfolio. I understand that [they have] put in a call to you and would like to discuss this further, and [they] wanted me to give you some materials on recent events and analysis with respect to Bitcoin.
There was recently a Wall Street Journal article covering this topic
The article tells of a paper by Marie Brire, an associate professor at Universit Paris Dauphine in France, co-authored by Kim Oosterlinck and Ariane Szafarz of the Universit Libre de Bruxelles in Belgium, that concluded that a small allocation to bitcoin, perhaps 3% of a well-diversified portfoliocould improve one's risk-return trade-off. It also has several statements by Raoul Pal, a former hedge-fund manager and founder of the Global Macro Investor, and concludes these by saying he, more conservatively, put a small slice of his portfolio—between 1% and 2%—into the coins.
There have recently been senate hearings on bitcoins and other virtual currencies, and these have been notably positive. Even Ben Bernake wrote a letter to the senate committee stating that bitcoins are not directly under any regulatory regime and that they "may hold long-term promise, particularly if the innovations promote a faster, more secure and more efficient payment system.”
We had discussed investing a small amount of [your client's] portfolio with you in the summer of 2012. At that point in time, if a 1% allocation (about [some amount]) had been done, then the value of those coins today would be about [100 times that amount]. While a lot of the upside of Bitcoins have been realized in this time, we feel that Mr. Pal is right in his assessment that there is still value in investing now.
Sincerely, [My name]
submitted by btcthrowaway3 to Bitcoin [link] [comments]

The ultimate back-up plan: Your private key, stored in the block chain, encrypted

[edit: It is the ultimate back-up, but it doesn't mean it is the safest. I'm too tired to figure that out. I'm just explaining how to store a private key in the block chain, in case it is useful or can be made useful.]
I had that idea if someone is interested, though I guess people won't like it. It's a bit wild. We encrypt the key and put it in the block chain with a trick.
I'm not saying everyone should do this, but it could be useful to know it can be done.
If you trust encryption and your password more than back-ups or a third-party, then it could be nice. I'm no encryption expert but it should be strong enough.
"Instead of taking 1.3 quadrillion years, our magical cracking supercomputer would only need 328 trillion years."
If it's flawed or gets cracked after a billion years, I decline all responsibility. But you can be sneaky about it. I propose a sneaky trick at the end. It's a bit rough on the edges and crazy but I'll put it out there. If people like it, there are always ways to streamline.
Anyway, you can't memorize the key as you can memorize a password. It's true you can put it on paper; then lose the paper. You can encrypt it and keep it on hard drive, then lose the hard drive. Or on a service, and lose the service. The block chain though, is going to stay around as long as you need the key. So I suggest this whole alternative.
You can still put the information on paper if you want. But now, just your memory is enough. Just the password.
The drawback is the infinitesimal odd of someone finding out and spending a lot of years and resources on brute-forcing. I'm not sure what would be the odds of success. Just make it so decades of computing resource cost more than what's inside.
Now I'll explain how to do it from A to Z, for the few interested.
Plan: 0) Vanity 1) Get the key 2) Encrypt the key 3) Put the key in the block chain 4) Retrieval 5) Conclusion
0) Optional: Vanity I recommend a vanity address (choosing the first part of the address). So if worst comes to worst, you find it from memory in the block chain. And also, it's kinda neato. How-to: first, download VanityGen, direct/wiki. Extract it, then Open a console window at the location with shift-right click in the folder, if you have vista/7/8. Then type "vanitygen 1something" in it. It has to start with 1. If it's too long it'll take a lot of time. Ctrl-C to cancel if it's too long. Faster with GPU: oclvanitygen -D 0:0 1something (maybe broken atm) When you have the key, type "importprivkey mykey" in Help->Debug->Console of bitcoin-qt, to add it. Result of this optional step: A beautiful address which can be retrieved from memory if needed (after it has been seen in the block chain with a transaction)
1) Get the key - Download open source Pywallet: direct/profile - Extract somewhere. Shift-right click in the folder and "open a console window" - In the console, type: pywallet --dumpwallet dump.txt If your wallet is encrypted, then add --passphrase=PASSPHRASE Now you find the key in dump.txt. (note: it reads the wallet at C:\Users\x\Bitcoin) Result of this step: the private key; it looks like 51 characters starting with the number 5. (To delete dump.txt, you can use a software so it can't be recovered from HDD, like Recuva it seems)
2) Encrypt the key - Choose an algorithm. Personally, I pick AES-256. - Download a trustworthy program to encrypt text with the algorithm. Here are two with GUI I found. It's open source but I didn't check it, so it's not 100% safe: They're both jar files. Maybe you can click them. Personally I have to go in the console; I'm so tired of that coffee cup. "C:\Program Files (x86)\Java\jre7\bin\java.exe" -jar ImmediateCrypt.jar. It gave me an error though. Not the other. Maybe someone can suggest better. - Choose a good password. It's all about the password (and the software). AES is weak with weak password. And crazy strong with a good password. This is not like websites with protection against brute-force. People can brute-force fully if they find out. I like psycho-pass method which is about a pattern on the keyboard instead of semantics. Side Info: Or a passphrase if you want. Here is a nice table with password entropy: Below 64 bits of entropy, it's too unsafe, it's too weak. We need 128 bits or above, as far as I know. That is 25 random alphanumeric. If you're feeling paranoid, 256 bits. You can check entropy of password roughly here: Remember it is not like websites. There is no "Forgot password?" button. Memorize it permanently; and maybe write it down in your favorite book just in case, I don't know. Result of this step: the encrypted key. It doesn't matter what it looks like as long as it takes you back to the key when you click "Decrypt". (on a different software, preferably)
3) Put the key in the block chain It works by sending some minimum amount to fake addresses, with data encoded in the addresses. Can't try this part because I don't have bitcoins. :[ Only a wallet! If some liked the guide particularly: 1thxd4KJLhBMcfCYaVKYMA8Atv3Dfx9hb :3 I'll follow the method of this great article: (the blog is remarkable!) - We're supposed to split the encrypted key in chunks of 20 characters. Then convert from ASCII to hex. Last chunk we fill with extra zeros. I wrote a little javascript to do it all automatically! If you don't like it, find a software, or do it manually. Not tested much but seems to work for my test. I'll say how to know if it worked. Copy that: encrypted='';har=(encrypted.split ('').map(function(c){return c.charCodeAt(0).toString(16); }));ek="";har.forEach(function(c){ek+=c;});while(ek.length%40!=0)ek+='0';iEK=0;ek2='';while(ek.length>0){ek2+=ek.substr(iEK,iEK+40) + "\n";if(ek.length>=40)ek=ek.substr(40,ek.length-40);else ek='';};ek2;
Check eventual comments to know if it's a hack/broken mess.
I don't do much Javascript, or much anything. Paste the whole thing in the javascript console. To open the console: Chrome, Ctrl-Shift-J. Firefox, Ctrl-Shift-K. IE9, F12. Put your encrypted key between the '' right at the beginning, then enter.
This should display rows of 40-characters chunks of the encrypted key in hex format (numbers, and a to f). I have 6 chunks but it depends on encryption. It should give twice as much characters as the input except for last zeros, and follow this conversion table from Char to Hx column. If it doesn't, call the police. Or use some Ascii to Hex service.
Now we take these chunks one by one and use to convert to BTC addresses.
Send spare money to each one (the strict minimum is suspect and it'd get found easily) in the right order (wait for 1 or 2 confirmations each time to be sure).
And we're done! The information is safe and cozy, in the block chain. Not safe from brute-forcing, but safe from ourselves; and that's safer, isn't it?
4) Retrieval
Alright, how do we go back from the addresses to the encrypted key? I can't try it myself, but apparently, according to the article: 1) Get the transaction ID on, by going to the wallet's profile 2) Go to 3) There will be something like that: "out":[ { "value":"25.08603421", "scriptPubKey":"OP_DUP OP_HASH160 27a1f12771de5cc3b73941664b2537c15316be43 OP_EQUALVERIFY OP_CHECKSIG" } ]
And you need to translate the "27a1f12771de5cc3b73941664b2537c15316be43" part from hex to Unicode. The result should be the chunk of encrypted key, written in hex again. You put all the parts together in order, remove extra zeros. Then use a program to go back from hex bytes to ASCII. Maybe someone can do it or I'll put the javascript one of these days if people are interested; I don't think they'll be. Usually I'm serious and extensive but you can't imagine how tired I am these days, of everything. Anyway, you put that ASCII in the AES program with your password, you click Decrypt.
Then you have your private key.
If you do this, don't lose other back-ups until you have successfully retrieved the key, to know it works.
5) Conclusion I understand that there's a small chance that someone figures the transactions are data, reassembles the parts, has massive luck and breaks the crazy strong encryption with supercomputers and botnets in less than decades, or aliens hack your bitcoins with quantum computers, ect... But I don't know, that seems very unlikely to me; more unlikely than losing personal back-ups or third-parties being untrustworthy.
More importantly, it gives peace of mind of not having to manage back-up stuff. You can format your hard drive and burn your house down if you want without worrying about losing stuff; well, except the house. And maybe the wife. Or you go to prison 20 years, and it'll still be there. If some of you want to go to prison. I know of one.
Here's a complicated idea for the extra-extra-paranoid: You send just one letter by one letter of the encrypted key, into dozens of fake addresses, to which you send bitcoins you got from an exchange and not from the main wallet, and only you know the correct addresses/order with the data, because of a pattern in the other letters. For example, the 2nd letter of the 1st data part is the 1st letter of your password when it's hashed. The 3rd letter of the 2nd data part is the 2nd letter of your hashed password. Ect... And it's not true for the other parts. So you know the order, but not someone without the password. It can go like this for many parts, then maybe if you run out of letters you send through a different wallet. All other characters are misleading except the 1st one, or last one, being the key character. And you also send money to other fake wallets which are purely misleading. Even if a flaw in AES was found and it could be broken instantly, an attacker would have to find the correct combination even before the strong encryption brute-forcing, he can't even know if he has the right combination, and that can be a big number of combinations. You can do the math. It's exponential stuff, I think. That's something I just thought of quickly, and I don't know much about any of that. Someone can find better. (Maybe, or maybe not, there's something about the encryption output which makes it so we can find the order back without password, then we'd need some kind of trick to obfuscate the position or nature of key characters but I won't spend any more time on something likely to be wrong/uninteresting).
tl;dr: "It works by sending some minimum amount to fake addresses, with data encoded in the addresses. "
Point is, once we know we can store data in the block chain, there are plenty of ways to make it so we're never locked out from the main address.
Well, if you can remember the password.
I hope this was useful to someone!
submitted by yemethzi to Bitcoin [link] [comments]

Worse for Bitcoin than Ben Bernanke? The Assassination Market, offering a *Bitcoin* bounty for his murder.
There is a catch 22 on giving this attention, but since Forbes just tweeted it I guess it won't hurt to expand on here. This is not what Bitcoin needs... more association with criminal activity. For some people drugs are tolerable, but not many people are alright with assassinating people who hold public office - no matter how unpopular they are.
From recent Bloomberg article on US agencies saying Bitcoin offers legitimate benefits and today's senate hearing on virtual currencies:
Ben Bernanke, chairman of the Federal Reserve, is also weighing in on the hearing, saying that it has no plans to regulate the currency.
“Although the Federal Reserve generally monitors developments in virtual currencies and other payments system innovations, it does not necessarily have authority to directly supervise or regulate these innovations or the entities that provide them to the market,” Bernanke wrote in a letter to the committee.
I'm not arguing that the Fed isn't evil... but to assassinate someone appointed to chair it is nuts. Especially after he releases a statement saying there are no plans to regulate it, and referring to it as innovative. If you want to hurt the Fed, you should be pro-Bitcoin - take at least some power away from them. And having Bitcoin linked to this type of website is not pro-Bitcoin. It is giving anti-Bitcoin people yet another thing to point to when arguing why it is so bad.
submitted by milone to Bitcoin [link] [comments]

KenFM - YouTube Ben Bernanke - YouTube DER GEFÄHRLICHSTE KNAST DEUTSCHLANDS - Die JVA Aachen  HD ... Bitcoin Dips To $5,103 - Here's Where I Set My Next Orders, China, Bernanke Statement - CMTV Ep66 SmartMetric to Launch World's First Bitcoin Card With Biometric Fingerprint Protection

In a letter ahead of today’s congressional hearings, US Federal Reserve chairman Ben Bernanke mostly distanced himself from virtual currencies, saying the Fed “does not necessarily have authority to directly supervise or regulate these innovations or the entities that provide them to the market.” But he also said that bitcoin and its ilk “may hold long-term promise, particularly if the ... Mr Bernanke, in a letter to the Homeland Security committee, ... Many Bitcoin businesses are finding it hard to persuade traditional banks to deal with them in the US, but enthusiasts believe that ... A September letter released on Monday shows what Ben Bernanke has to say about the controversial crypto-currency. Former Federal Reserve chairman Ben Bernanke offered both muted praise and criticism when discussing bitcoin in a new interview. Ahead of the meeting, U.S. Federal Reserve Chairman Ben Bernanke has released a letter to help guide the senate. Quartz’s Zachary Seward called it a “cautious blessing,” with Bernanke acknowledging the Fed doesn’t have the authority to supervise virtual currencies, but that they “may hold long-term promise, particularly if the innovations promote a faster, more secure and more ...

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