Quote from: Peter Todd on August 19, 2013, 04:23:50 PM

Quote from: DeathAndTaxes on August 16, 2013, 03:43:31 AM

However today this is limited to a single entity. It only works if you and your receiver are both on MtGox. However look forward a couple years and say you have a MtGox account and someone else has a coinbase tx. In theory MtGox and Coinbase could extend reciprocal lines of credit so MtGox notifies coinbase and coinbase instantly reflects your new balance. Once a day MtGox and coinbase "settle" the books with a single blockchain tx. Just to be clear this does NOT currently exist but it could. Eventually a network of these entities could exist. In someways this resembles a banking network with one SIGNIFICANT difference. Today you can't be your own fiat bank (well at least not with any reasonable cost) but you can choose to be your own Bitcoin bank. All you need the ability to run a full node and willingness to put all tx on the blockchain.

Don't forget that because Bitcoin is based on cryptography, you can audit that Bitcoin bank and prove they, for instance, hold funds they claim they do, whereas in the real world you just can't get absolute, mathematical proof.

inputs.io, for example, have told me they are planning on implementing proof-of-ownership soon. Essentially that means they will prove to their customers that the funds held by them on their behalf really are backed 100% by coins on the blockchain. Of course, that doesn't stop them from taking the funds, but it means if they do they will be quickly caught. In the future mechanisms can be implemented like fidelity bonds and trusted hardware that make even stealing the money unprofitable - much like Bitcoin itself is designed so that miners have economic incentives to "mine honestly"

FWIW I keep a few BTC worth of "day-to-day" spending money at inputs.io, as well as easywallet, even without any auditing. To me the privacy is worth the risk of the funds getting stolen. (I lost about $100 worth at instawallet)

Peter, how does this proof of ownership work. Does it require the wallet to disclose all the addresses that they own so that people can check?