Quote from: RSantana on September 08, 2011, 06:01:43 AM

Quote from: casascius on September 08, 2011, 05:47:42 AM

Quote from: RSantana on September 08, 2011, 05:35:15 AM

Nice job on the coins, they are cool. However the trust factor is way to high. I went down this road myself when I created the gold plated CoinBit http://CoinedBits.com.

The original consumer has to trust that Casascius isn't selling them a zero value coin. The circle of trust then gets wider if the original consumer tries to trade the coin. The second person receiving the coin now has no way of verifying the coin originated from Casascius.

Counterfeiting this coin would not be difficult, and would be extremely lucrative if the Casascius coin gained adoption.

This is why I ended up keeping the CoinBit as a novelty or souvenir coin.

If your CoinedBits had a flat surface about an inch in diameter on them, they could be made to contain bitcoins and people would still happily buy them.

If someone wanted to throw resources at counterfeiting the coin, seeing as people are already willing to pay a 25% premium and shipping on top of that to acquire the coins, why wouldn't they just throw those same resources at legitimate coins and not risk getting their cover blown? One could just as well counterfeit Bitbills or FRN's. Further, people are going to be peeling and redeeming a percentage of the coins... until people start complaining in the forums about the existence of counterfeit Casascius bitcoins, for the time being, one can be pretty sure that the Casascius hologram is an accurate indicator of origin.

It would be more profitable to counterfeit the coin than to make a legit coin.

You identified the problem when you said "for the time being". It wouldn't take long for people's trust in the coin to falter.

Some of this could be reduced with the assistance of a website application which allowed public reporting of coin location by date. (postcode or equivalent)
Phone-apps could be used to quickly scan the public key and check not only that the value exists in the block chain - but to semi-automatically report where the coin is.
e.g push a button that says 'yes - report coin was here now' and the phone uses it's geolocation magic to do it (for some user-determined vagueness of 'here' and 'now')

Some people may have no interest in doing that for privacy reasons - but it could be fun to see where a coin has been. If you see from the history that the coin was supposedly somewhere that you know it couldn't have been at the time (or already flagged as suspicious due to failed redemption of same code) - you should refuse to accept it - or if too late for that, immediately attempt to redeem the coin on the blockchain and report it if it fails.
Any other people scanning a coin with the same public key would then know also to attempt redemption (or to quickly risk passing it off if they're dishonest!)

Any large scale counterfeiting operation would need to have legitimate public keys still showing value on the blockchain - so if even a few users and especially point-of-sale systems used the casascius website verification app - the profitability and therefore motivation for the counterfeiting would be significantly smaller.

Sound reasonable?
It might be open to some trolling by false reports - but people would have to have come into contact with the coin to learn it's public key to do that I assume.

EDIT:
oh, I just noticed this:

Quote from: casascius on September 07, 2011, 12:51:05 PM

... I'm willing to pgp sign a list of all the Bitcoin addresses used in this project.

That would scupper my idea above. If it's possible for the public to determine a complete list of coins - then false reporting by counterfeiters/jokesters would be a problem.