Quote from: benjyz on February 28, 2014, 07:41:29 PM

good idea. much more should be done in this area. however there are several very hard problems though. proof of balance is not worth very much if an attacker can remove all coins in minutes. so if 500M$ evaporate without noticing, there is the question how to create accounts which are more secure by default. could one create an address which has different features? an address which is sealed so that only a certain percentage can be withdrawn? a multi-signature address? everything depends on the security mechanism.

I agree. If someone's storing all their reserves on one machine, in one wallet, with one password... well, then you've got a problem. And there's very little they can do to prove they aren't doing that.

But right now, a temporary measure is needed.

We need to know that these large exchanges aren't running fractional reserves. Mt. Gox insisted, repeatedly, that 90% of its assets were in cold storage. But it never published keys and sigs. And so we find out now that maybe they were making that all up. People asked for keys and sigs to prove it... but they "demurred" on those requests...because "nobody else" was doing it.

If the Bitcoin Foundation came out with a "BIP" for this... even a simple thing like a standard JSON format and a requirement for SSL, that would be enough for the community to say... hey... there's a standard... why don't you adhere to it.

IMO, the first exchange to go transparent on reserves will see a flood of new business.