I don't know if this is the right place for a UI tweak/feature request, but here goes:

Right now, the market depth diagram at the bottom of a securities page has axes {vertical: number of shares/bonds, horizontal: price in bitcoins}. The problem with this format is that most securities have a large bid order at a very small value per share, e.g. 10000 at 0.0004 for GIGAMINING. This makes the more relevant part of the market essentially unreadable. I propose that you scale the axis by the price per share, so that we have {vertical: total bitcoins at this price level, horizontal: price in bitcoins}. So the above order would be a simple 4 BTC, and it wouldn't skew the graph so much.

What do you think?

-s

I've been wondering whether pirate is involved as well. The one confusion is that he mentions local customers, and if he's doing bitcoin HFT to profit off of volatility (thus smoothing it out) then I don't understand why he would have local customers... but this is probably explainable.

-s

Pirate, I'm trying to figure out what your game is... after some more research and consideration (and your statement to the contrary) I'm less convinced of drug-related activities.

Various previous comments imply comex experience, which is interesting... But your public record points more to business consulting...

Thanks for clarifying a little bit, and sorry if any of my past conjecture has raised the stress level of doing whatever it is you do. I'm really just curious =)

(sub)

-s

edit: I like the rum idea... maybe even a 'bitcoin, the early days' commemorative treasure chest with casascius coins and pirate rum bottles...

I've thought about the same problem. I don't like the coins going back into mining rewards however, and I also don't like penalizing people who are ultra-security conscious and store their wallets offline with the need to log in once a period and shuffle their coins around.

However, the idea of a default future transaction is a good one, as follows: Imagine I can sign a 'transaction' that says essentially that another wallet can spend my coins after a certain date. Now, I can 'opt-in' to a system where I sign my coins to a 'back-up' service effective one year from now if I haven't spent them. Per our contractual agreement, if I lose my keys for whatever reason, they will sign my coins over to a new wallet once the time limit expires and they have access. This allows me to never give them access to my coins as long as I have my key, because before the period is over, I can send my coins to a new wallet and make a future-transaction from that wallet.

Obviously the period would be customizable, and there's trust being placed in the backup service, but its a way of distributing loss-risk around, and if you only 'banked' with local people, I'm sure local contract law would give you good recourse in case of theft.

-s

There's a lot of straw-man arguing in this thread.

Some of us believe that pirate is PROBABLY laundering drug money or something not too far from it.

There's a lot of conjecture about how law enforcement could or could not influence the bitcoin economy.

Some folks are arguing that no-one has proved that pirate is laundering money. Guess what? You're all right! You're also all missing the point: 7% weekly is questionable, to say the least.

It's a rate that is unsustainable unless there are transactions going on at the level of the entire Bitcoin Saving and Trust market cap with a transaction fee greater than 7%. This is relatively easy to achieve in various lines of *questionable* business, accepted as the fee for the added risk of increased scrutiny and potential for legal action (or worse, depending on who your partners are).

I disagree with the notion that pirate going down would hurt bitcoin. I'm indifferent, either way should be fine for bitcoin. Any economy has a continuum of markets, from black through grey to squeaky-clean white. Even black markets have a continuum: hit-money and human trafficking on the one side, and simple goods smuggling and tariff avoidance on the other.

No-one can reasonably argue that pirate is squeaky-clean white, if for no other reason than the incompleteness of his public disclosure.

So what? Decide where you're willing to operate and operate there. Let's skip the 'you don't have proof!' for assertions of opinion.

-s


I'm not involved in prosecuting anybody, and never claimed my beliefs about pirate's activity constitute probable cause. I was just discussing the parameters affecting the hypothetical situation where a money launderer is being investigated by law enforcement in the US.

As an aside, if law enforcement can convince a judge that a money launderer's operation is 'permeated with fraud', in the specific sense relating to document warrants, they can perform seizure indiscriminately, rather than having to name what they expect to find beforehand. So, effective money laundering requires at least an ostensible cover story to avoid that injunction.

"I don't always sip fruity drink, but when I do, I sip dos frambuesas"

splatster, while in the US 'innocent until proven guilty' holds, all that is necessary is probable cause to obtain a search warrant that would make proving guilt much easier. In serious money laundering cases, searches/wiretaps/etc have gone on for years prior to the actual indictment. While in the US hacking is still not allowed for obtaining computer records, precedent for offensive information gathering has been set in Germany. Encrypted hard disks provide no defense against that threat vector.

-s

In a true market-moving demand situation, the bot's supply of bitcoin would be exhausted. A similar argument would result in exhaustion of dollars to buy with in a true market-moving supply situation. However, if the bot is colluding with the exchange, then the exchange can have effective unlimited supply/demand by 'printing money' in either mtgox usd of mtgox btc subject to avoiding a 'run-on-the-bank' and trying to balance out the accounts over time.

This scenario makes a strong argument for having exchanges operate on the bitcoin network so that at least the btc side of the exchange is subject to global auditing.

-s

That would imply that the net demand other than the big buyer is sell-heavy. Which it may be... but then it would be a poor move for that big buyer to keep on purchasing.

-s

I agree that the price stickiness is eerie and inconsistent with some of the fundamentals. Front-running doesn't seem to explain price stability though, although it could certainly be happening. If anything, Front-running should just change who materializes the profits from the market, it still relies on fundamental market direction for its usefulness.

All that being said, having a bot to search for front-running would be useful. Such a bot would still be dependent on accurate reporting from the exchange...

-s

While I have no experience with pirate, I took it for granted that laundering drug money was his gig. I assume most pragmatic analysis leads to that conclusion. I would guess that most of his investors believe this as well.

-s

Interesting notion, essentially issuing a bitcoin-backed currency. 1-bitcoin as the lowest denomination seems a bit high however. I would be interested in reviewing one if its still available.

I'm interested in finding ways to enable paper bitcoins in an easy, personally mass-producible way. The reasoning would be for a fair with many vendors, communal yard sale, etc, where people could purchase tickets with something like a private key that has been promised money for the following day on them, without needing holographic tamper resistant sticker or equivalent.

It seems relatively easy to have the clients accept transactions whose output can't be spent for 'x' amount of time, and transactions initiated before that time would be ignored. The problem I see with this is that an attacker could scan all the private keys they see, and try to race the legitimate holders at the expiration of the spend restriction.

Can anyone think of a scheme that would allow the issuing of distributedly redeemable coins using just normal paper and open information?

-s

If that is indeed the case, it's hoarding price stickiness... and its ultimately misplaced. I believe bitcoins will increase in value, so I would buy on a fall in price. But if I think that its my purchases that keep the price up, I would be better served by gradually selling off my investment because I can't keep the market afloat on my own. I could pursue a strategy of buying just a little bit and hoping that other buyers are encouraged by the price resistance, and then sell into their demand... So I guess that last strategy is possible.

I for one think the extra traffic is REALLY needed for the bitcoin ecosystem. If it ever starts really catching as a medium of dominant exchange, even locally, 20,000 transactions per 24 hour period is only a small portion of what is actually needed.

I think we will need to move to an increasingly thin-client based model, but perhaps allow blockchain verification to occur occasionally, e.g. once a month, locally running through all the transactions since my last verification locally, and verify that it all makes sense (e.g. hashes line up, transaction input is all available, etc.). Then the thin-client could have a 'last trusted block hash' and servers can provide merkle trees to provide verified balances, etc.  This would make the system more like an open-book, transactionally peer-to-peer, and crypto-hard-to-forge version of a banking system, but it makes sense to me to move in that direction.

-s

I am also getting the 504.

I pm-d you, I can do the dwolla transfer to mtgox for you. I haven't done this before so better to start small both to get the hang of it and test the ropes. You could also try to find someone else who has more experience. I PM'd you my email if you want to try it.

-s

Your proposal is interesting, and I agree the confirmation time is definitely a point of some friction. I like litecoin's 2.5 minute target, but even that could get unrealistically large for things like high frequency trading. Definitely worth considering. One of the potential weaknesses is it creates an incentive to oscillate the difficulty. This incentive already exists, but you need a significant amount of hashing power to benefit from it in the current system. Bounding the weight deviation seems an effective way to keep that incentive down.

So, the exchanges have been keeping a fairly tight band around $5/BTC, I'd like to hear opinions on how much you attribute this to the following factors:


1) Fundamentals: economy is growing at the same rate of the influx of coins from mining so prices stay constant
2) Price stickiness: optimal trade would occur at a different rate but either hoarding or excessive selling is keeping the price up or down
3) Price comfort: easy to think of bitcoin rate as divide USD by 5, works well with our decimal system
4) Other factors, please describe...

-s

Just to clarify, people with MtGox USD are having a slow time getting it back to Dwolla USD? Do we know where the slowness is coming from?

-s