That isn't the case. A lot of people including Mike Hearn have lost their BTC wallet from back when they first mined BTC. A lot of people who aren't paranoid about being hacked will leave some satoshi laying around. And not everyone is a security expert who even knows what the phase "cold storage" means. Why do we have to act like snobs about this?

Sure we could start businesses to secure people's wallets for a fee but then we'd be acting like banks and would probably have to be regulated.

Easy, criminals can remain uncaught because innocent people are willing to hide them among us, or just do not object to it. If everyone thinks someone is a scumbag deserving some punishment, they will all actively participate in spotting him, like if he tries to use Coinjoin everyone will refuse to mix with his coins, then he has no place to hide.

The law-enforcement could even be compelled to be more transparent, because they have to do so to get our help, rather than forcing it upon us.


This should be Hearn's original idea: https://bt.irlbtc.com/view/157130.0

What he is trying to present to the politicians may be a cooked-up version.

This is indeed worrying. Hope this never gets implemented.

This tool will kill Bitcoin as we know it. I wouldn't mind if it was only used to go after thieves, but there is no way to know and/or stop the government for using it however they see fit. The problem in my opinion is when they start using the tool to go after "Silk Road" types of people. I believe as long as someone is doing no one else harm, them and only them should be able to choose what is put into their body. The drug war has failed and the government is starting to realize it, the more the people push for policies such as decriminalization/legalization of marijuana, the more obvious this will become to the government over time. If this tool is used to further the government's agenda on the failing drug war, then I strongly oppose it.

Another problem... who enforces the basic American principal of innocent until proven guilty? How would the due process be like to be able to black list coins? Would there have to be a criminal court case, or can they decide to blacklist coins on a whim whenever they deem that someone is doing something illegal? This could be very dangerous against freedom of speech. If the government doesn't like what you're saying, who's to say they can't just blacklist your life savings? What recourse would there be in that situation? Are you going to call the Bitcoin police?

I'm afraid such a tool would be horribly misused by the government. We cannot trust them with such power, because eventually it will be used against us. Where would it end? Blacklisting coins because of parking/speeding tickets, past due taxes, unpaid Obamacare taxes? Anyone that thinks for a second the government will use this tool only for its intended purpose of going after thieves is slightly naive. This would just be another step in the wrong direction as far as personal liberties go. This is like the patriot act for Bitcoin... sure it's built for a good purpose, but they can also easily misuse it however they see fit.

It does encourage people to check whether they are receiving redlisted coins, precisely because of what you're outlining. If you know coins are redlisted, you will prefer not to accept them, as they are potentially the proceeds of a crime. This means they can be legitimately removed from your possession, they are someone else's property.

This is a much more difficult problem with a finite money supply. In the fiat system, banks and credit card companies insure against thefts, and the central bank can just print whatever is required to offset such losses as demanded by the treasury department of the government. The money supply expands and contracts to suit all sorts of needs. Bitcoin cannot adhere to this model, whoever ends up with provably stolen funds can only conscionably return them to the original owner.

The solution, therefore, is prevention, not cure. Hard currency limit dictates this. Hardware wallets and cold storage are new concepts that are only for the "experts" and "snobs", as some would say. Let's encourage the developers to make them easy enough for anyone to use with comfort. Let's encourage users to want these things, by talking about them positively, not negatively.

There are a lot of technical solutions which could empower the community without dividing it.

This idea you present actually isn't all that bad. If individual users want to set their client to only deal with other trusted users that actually would be an excellent feature. No one wants to get scammed to find out that they cannot trust. The principle is that it should be voluntary.

Oh no please no more Ripple! Ew!

Don't forget that Mike Hearn works for G$$gle, which allegedly has close ties to NSA/CIA.
NSA's one known attack vector is to infiltrate protocol development committees and influence their decisions to compromise security.

Yeah, that's how lists work.  </sarcasm>

Seriously, how do you expect to prevent other people from making lists?  For all you know, I have a list.  Maybe you are on it now.


If the protocol had a mechanism that prevented spending of listed coins, there would be no point in notifying users.

But first, how would you convince people to use the fork with enforcement?



The bottom line is that right now today, with no changes to anything, if you end up with coins bearing an interesting history, you take the risk of someone becoming interested in you.  You cannot prevent this risk.  You cannot mitigate it.  If you ditch the coins, you are still part of the chain, and you may get a knock on your door from people wondering how they came to you.

Widespread mixing, if and when it arrives, will hopefully muddy the trail of every transaction, maybe even to the point that most investigations become futile.