The authors don't detail much experimental evidence about their new taint model (basically FIFO accounting for taint), but they do offer a couple of numbers which, if supported by more testing, would be quite impressive. At any rate, there's ample food for thought.
If the legislative landscape they hint at really comes into being, I don't know where I'd stand on the line between "hard" and "soft" approaches. Bitcoin enthusiasts? Investors? Law enforcement? All of these positions would entail both "good" and "bad" practical consequences from my self-interested point of view.
Nice piece of work. Computer scientists discussing legal implications with a practical, technically sound background. A rarity.
Tasty find merited.
One of the problems with such a 'taint' system that it doesn't address, is what of coins falsely declared stolen? In the paper they seem to assume all such declarations to be honest, but in practice it just moves the arguments to the lawyer-enriching 'how to get these coins declared stolen or not' level.
Hm, I hadn't thought of that.
Can you name a scenario where the game of falsely reporting a crime ("someone stole my coins!") has a positive probabilistic sum? Penalties can be harsh, and partners in crime won't be happy to see their newly tainted coins decrease in value.
Just look at the endless similar scenarios in day-to-day business, deals that go wrong, counterparties accused of all sorts variations of theft, bad faith, lies, non-delivery etc, even in the strong legal cultures of the first world. Let alone what goes on in places like Russia or parts of Africa.
No, write access to 'the list' of in-dispute coins would very soon become the salient issue. And who could dispute cleanliness? Only the immediate previous owner? Or how owners many back? Or not directly involved parties as well? Me? You? Pretty soon everything could be 'tainted', and thus nothing would be.
I think the only way Bitcoin can work longterm is as a bearer instrument: you possess it, you own it. In fact, I think this - (Roger notwithstanding) - is the key "cash" part of the "peer-to-peer cash" description.