If the difficulty increase becomes linear and BTC price doesn't decrease, then I think a card can generate its money.

But it will take months. And you need a good GPU.

And you'll have to take into account the cost of electricity too.

Um, I think he/she meant "impress"...

Right now, we are just calculating random hashes, simply because it's difficult to do so, and money is supposed to be hard to make.

The last few weeks the Bitcoin network has been seeing a slight decline in size from the near 900Ghash/sec peak on March 6th. Some people think that was because of bot-nets joining, or some big supercomputer (it then fell to around 500Ghash/sec). If that was the case, then we may be experiencing the negative effects of a sudden injection of BTC (inflation) in this latest price decline that some took the liberty of labeling a "bubble" [but then, it should only be 5000-10000BTC; a few days of market volume].

Network size is making a U now and appears to be starting to go up again.

There should be more people interested in BTC soon.

Yep. Bitcoiners are "bad-ass"! Something like that.

Guns! Drugs! Sex...

Bitcoiners have guts!

But it really depends on who you are talking to.

This is exactly what I was afraid of: The labelling of Bitcoin users. Given that bitcoiners are a tiny minority, there's going to be serious trouble if this kind of talk "hits the mainstream", so to speak.

There's been some bad press already.

They are working that out. But I think they had better settle soon, otherwise it's going to take months, and the lawyers are going to have a feast.

The next wave of BTC buyers might take a few days, or a week to come and I see everybody is worried about where BTC price is going to go.

I guess it's better to avoid trading like crazy for a few days, and wait for more BTC demand.

Bitcoin will still be Bitcoin, as long as cryptography is still cryptography.

Pah! You silly speculators!

Liberty Reserve has an SSL certificate by VeriSign Inc. ("Class 3 Extended Validation" it says, issued in February, for 2 years). I think VeriSign certificates cost quite a bit, and VeriSign is pretty reputable (used by banks). In the VeriSign website, they say they give "warranties" of more then $100,000 . I.e., if you can present a false certificate issued by VeriSign then, congratulations, you win $100,000.

These "certificate authorities" simply vouch that "you are talking to the real Liberty Reserve" or "you are talking to the real mtgox.com" (or to whoever has mtgox's server's private key). It's still up to you to decide who to trust. My idea was that maybe this could be used to prove ["prove" or at least "show", with a relative degree of certainty... measured in dollars perhaps?] that this particular communication was really between mtgox.com and baron, for instance. In the absence of anything else (like a PGP-signed email), this could work as an on-line "statement" or a "receipt".

If the website says "your balance is this", in a way that any human could understand, then that's an obvious statement, isn't it?

I still haven't looked into the technical details of this. It will probably require special software in the client. Passwords would be included in this conversation, so, after recording, the client would have to change the password (and record the password-changing conversation too? he wouldn't show that last one, of course). If the website in question, at some corner, shows the current date/time, that is good (a statement that "this is the time now").

It's probably too late for all that now. Baron should had thought of this earlier. MtGox and friends can say whatever they want now.

And where are those $3000 LR transactions from Baron to the alleged thief?

These graphs should give you an idea of what has been happening to the Bitcoin network lately. Let's hope that drop doesn't continue either.

Currency (whether or not you use the word "fiat" to describe it) works because people accept it. People accept the paper currencies of today for the simple reasons that (a) they are used to accepting them and (b) everybody else accepts them as well. If people aren't convinced that BTC is a real currency and it can be used to buy real things or at least can be traded (both ways!) with currencies that are "real" to them, they won't be interested in getting BTC. Nobody will want to buy BTC using other currencies and the people who will have it won't be able to do much with it except give it away cheap, or trade among themselves.

I'll have to agree with the rest in that this was a ridiculous proposition.


There's no such thing as "inherent value" in anything. Bitcoins or paper currency. Value exists only when you trade something for something else. Our trading means that we both believe my thing is worth as much as your thing. So we trade, because I want some of your thing and you want some of my thing. This is elementary.

If everybody starts insisting like that, the volume of trades will drop; perhaps to zero.

I know that. The problem is that people won't stop to think about that. People are used to these papers that they can hold in their hands. "Money" for them are these physical things, and when they give those things to people in their day-to-day trades, they are not used to getting them back. The only exception is when they are dealing with banks. Banks are few, banks are honest, banks give papers back (statements) and everybody else goes to these banks. This is what most people know about "currency" (a.k.a "money"). [You work? You get money. You buy things? You give money.]

How are you going to introduce Bitcoin to them? Are you going to say "I gave my money in exchange for bitcoins"? Sorry, you lost. "What are these 'bitcoins' you are talking about? Can you bring a few here so I can see them? And... what did you say? You GAVE your money to somebody? Are you crazy? Who did you give it to? You are such a fool..."

People don't care about PGP, encryption, SSL, public/private keys, advanced math and all that mumbo-jumbo. It's science fiction to them. It sounds like a fairy-tale.

Because they don't want to give away their "real" money? Some will think "hey, if anyone can generate these 'Bitcoins' it can't be real money!".

Sellers are already insisting on higher prices, if you look at the open orders. The problem is that buyers aren't buying. The problem is that people aren't interested or are starting to be afraid of BTC. People who bought BTC or invested in hardware don't want to lose their investment, while the few people who are buying just want to make money fast.

Bitcoin hasn't been widely accepted so as to be directly useful to most people. Most people haven't even heard of Bitcoin. Anyone who read about Bitcoin and bought some Bitcoins is probably going to be alone. You can't go around convincing people (in your real-life social environment) of the validity of a new currency, when you are apparently the only one who accepts it or even knows about it.

I just noticed the bunch of Chinese students that joined the marketplace here. Obviously, it's because their teacher told them to. Maybe this is the kind of status that Bitcoin has in the real world? A "currency" for little kids?

This is still just a game with numbers. Winners being the creators and early adopters. If the drop in BTC price continues, some people will start referring to Bitcoin as a "bubble".

This isn't peanuts, this is $45000. And it's still locked, as I hear, and people are going to court. This is around the total USD transaction volume of MtGox (and maybe BTC in general) for around a week? Or more? I'm not sure, but it's a lot. All this talk about "scammers", "thiefs", "security vulnerabilities" etc may be affecting BTC in general, and even BTC price in the market. You don't trust a brand new currency/stock/whatever when you are feeling insecure about it.

I hope this issue is resolved ASAP and everybody gets their money back, even if they don't make the profit they expected.

Screen-shots (images) by themselves won't prove anything. The server is mtgox's. MtGox and friends can send you whatever they want. The best you could do with that access (if they "implement" it) is to somehow record your SSL communications with the server, so that someone can verify that the log you have is really between you and MtGox's server. The MtGox website has a certificate by GoDaddy. The log could be used as a statement by MtGox. But I don't know about the technical details of SSL.

MtGox could give a statement directly, but I see MtGox isn't talking much. At least not in public.

What would help is your giving the details of your transactions with the IRC guy you were talking about. That would be details of 3 transfers of around $1000 from your account to the thief's account at around January 7th to January 9th, that people can fill in on this form. You must have given those in exchange for this money (9000BTC).


I didn't know the names Mark Karpeles and Jed McCaleb until now. I think I'd use MtGox, even without that knowledge. If your "NDA agreement" was simply your asking Jed McCaleb in private not to say anything about you to anyone, then I guess he "broke" that. You said previously that you don't want to give your identity. Maybe these "identities" won't be necessary in the end.

EDIT2: Or maybe the "document" refers to the data in MtGox's server? Makes little difference.


Well, he is holding $45000 (possibly more) of Baron's money, while at the same time his claim from Baron is only $3000. Plus, Baron said that he can easily give back the $3000 as it's nothing to him. Funny thing is, I can actually verify that last statement now, since now 9000BTC (the money he got from the thief) isn't worth just $3000. It's worth $7000!

Looks like the stolen money paid for itself already...

EDIT: Baron, could you steal some of my money like that? Please?

EDIT3: I should add that, if MtGox's software has a security vulnerability that allows someone to steal $45000 from someone else, that is MtGox's problem, because that someone else is going to want their money back from MtGox, sooner or later, and that "someone else" is going to sue MtGox if he doesn't get it... Unless MtGox has so much money in his electronic "coffers" that he is going to start resorting to fractional-reserve-like practices, like a bank (if he isn't doing it already).

EDIT4: This whole thing is a big mess... But at least there's enough money for everyone.

I think you got it wrong. Baron gave transaction details of 3 transactions that sent money from LR account U1172929 to LR account U8227430, which I can verify that it belongs to MtGox (it's what the page for depositing funds on MtGox links to). Baron can probably show that LR account U1172929 belongs to him by offering to send a few cents to anyone who asks. The sum of the money sent to MtGox from U1172929 is 74616 USD.

According to what I read on this thread, what Baron is accused of is the stealing of 9000BTC by guessing a MtGox user's password. The evidence is in the Bitcoin block chain because the money was sent directly from MtGox to Baron's Bitcoin addresses (19n8ogD8imviHn9iZSpmUgdZqjTuDxzDwv and 1DVQEpTFjxYpZMVy4Bam9MCxeGEtmMmQCh). This is why Baron is believed to be the thief.

MtGox also accuses Baron of other things, but the evidence for those things is only in MtGox's server logs.

Now, Baron, in his defense, says that the money was offered to him by someone on IRC, in exchange for USD from his LR account. Obviously, the only way to prove this is to see evidence of Baron's LR transaction with the real thief and then to follow the money.

There is still the scenario that MtGox is the scammer in this case, who may be trying to gain a large sum of money, by sacrificing a smaller sum of money.

Also, another way to see if the person on IRC exists is to start asking people on IRC whether or not they have kept logs of their PM conversations at around the days when the 3x3000BTC transactions took place (the thief may have been PMing people, making his offer). A person who has "hacked" into a MtGox account and wants to sell the money may have been careful to make his offer only in private (as this is IRC, as I understand), so nobody can "see" him. Did Baron go to #bitcoin-otc? If so, he must have not followed any #bitcoin-otc "rating systems". Possibly, the thief sent the money first (not his money, anyway) and Baron just felt "obliged" to give something in return.

A protocol analysis of the SSL communications between Baron and MtGox probably won't be any good, because of the "Diffie-Hellman key exchange". A digitally signed such log would prove what Baron did with his money on MtGox, and how much is his. This is analogous to receipts.

Another way to go about this is to search for everyone with whom Baron has traded on MtGox and try to get statements from them. But only MtGox has that information now, in his own files, as Baron is locked out. It may be gone already, if MtGox is the scammer. This is probably the reason Baron wanted to take screen-shots.

I think the main reason that the dispute can't be resolved right here is that there is difficulty in proving that the people who speak are separate people. But then, in RL courts, there is always the problem of false witnesses.

I read the whole thread today. I haven't read any following threads. I have to say this:

The courts may be the only ones who can see who was the guy on IRC from whom Baron bought the 9000BTC in exchange for LRUSD (as Baron says - they may have done their talk in private, and the thief may have been the first to do a transfer), decide that he is the thief and give the money back to the guy whose MtGox password was guessed [and to Baron]. To do that, they will have to see the times that the transfers took place. If the transfer from MtGox to Baron's BTC client happened at around the same time as a transfer from Baron's LR account to the thief's LR account (market prices), and the thief is a separate person, that would show that Baron is innocent.

EDIT: Sorry, I should have said "give the money back to Baron, and order Baron to give the 9000BTC back to MtGox".

One thing that can be done here is that Baron can give the details of his LR transaction with the thief, so we can verify it with LR's form, like the other transactions he gave. Proving that the thief is a separate person though is a different business altogether. I don't know if this can be done here.

EDIT: And even if it can be done, it could just be a friend of Baron...

EDIT: And even if it can be proven that Baron has not been conspiring with that guy, the authorities will have to follow a money trail of $3000. Who knows where it went...

I remember sending an email to the Bitcoin Central guy about the web design (terse, to the point that it becomes confusing for new people) but no reply and no change. I guess he is too busy, or he only likes encrypted emails.

A lot of trouble for bitcoin recently.

For the record (it's just now that I notice), it looks like the prev_block hash in work.data is a little-endian series of big-endian 4-byte words:


I must have been blind.

EDIT: Though, the first 64-byte chunk is indeed ignored, at least by my miner client. It's not necessary for the calculation, since the server gives a ready "midstate".