Quote from: AbelsFire on September 02, 2012, 08:56:11 PM

Quote from: ItsDom on September 02, 2012, 08:40:52 PM

I'm aware it has a significant amount of momentum and there is a possibility of a paradigm shift as a result. However, most organizations at the moment, are at the mercy of their banks, which are in turn (supposedly) at the mercy of the policy and legislations. I personally believe the majority of corporations that use a bank, and have a legal team and legitimately declare their money and tax will not accept Bitcoin without some form of legislation change. I have no evidence to backup this claim, although the EFF is an example instance. So there maybe a paradigm shift, but for large scale adoption (e.g. your local tesco's accepting it) there's going to have to be a legislation change.

It's definitely possible that a potential paradigm shift created by Bitcoin could lead to a change in legislation, which could then lead to larger scale adoption. But that would still require a legislation change, which I personally believe should be informed by academic research. Most large corporations should (an typically do) do what the law says and the law says very little about Bitcoin, so I believe they will do very little about it.

According to at least one study the fastest growing economy in the world operates outsides the bounds of legislation http://www.foreignpolicy.com/articles/2011/10/28/black_market_global_economy?page=full so the question remains, how do we know that the legislators, policy makers, and corporations which are currently dominant will continue to remain relevant in the future?

You appear to be operating under the assumption that these organizations will be able to forever act as gatekeepers but it could also be the case that they will be forced either to adapt to a new paradigm or else cease to exist.

Things may or not play out that way, but you appear to be dismissing that possibility entirely.

I understand what you mean, and you're correct, I am writing, researching and living from the point of view of someone in the western world, that pays taxes (as much as students have to pay) and does my shopping at the local Sainsbury's. In the UK at least, I believe that these large corporations will act as gatekeepers, and should a paradigm shift come, which "forces" them to change, I don't honestly believe it will be portrayed in that way - I think it will be portrayed as "we've got some new research suggesting this isn't THAT bad, so we'll make a new legislation for it." I don't believe they will admit defeat and just let it happen, they will grudgingly, in the face of research an public outcry, concede that they need to legislate and accept it.

You are right though, I do need to bear in mind the large portion of the world which do not consider or believe in the legal system of their jurisdiction. I've never really thought of the benefits of Bitcoin for such people - suppose potential long term cause of academic research may not be of direct benefit to them. It is sometimes cited as an inherent pitfall with the nature of higher education that research conducted is typically going to be in favour or at least from the eyes of those that support the legal system or government in some way.

But I stand by my belief that the "average joe" (who is probably better off than the majority of the world) isn't going to be able to go down to his local Tesco and spend his Bitcoin in all its free, pseudonymous, unregulated glory without some some legal confusion or some legal formalisation at it. I don't think it's totally impossible, more improbable. There's the example of the up and coming BitInstant credit card, but that requires formal identification of yourself and a small fee to get (justified by the cost of the card - understandable) which sort of goes against the concepts of privacy and free money management that Bitcoin tries to advocate. I'm aware there's more to Bitcoin than just privacy and free money management though.

Quote from: Yankee (BitInstant) on September 02, 2012, 09:19:15 PM

Quote from: ItsDom on September 02, 2012, 05:54:29 PM

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Not only will I have no issues, it would be my pleasure to.

We have JD students, masters students, and people that are generally interested stop in the office all the time to pick our brains.

-Charlie

Brilliant, there tends to be quite a lot of web relevant conferences in the states - if I go to one over the next 3 years, I'll try swing by:) thanks.

Quote from: moni3z on September 02, 2012, 09:28:12 PM

Quote from: ItsDom on September 01, 2012, 05:07:30 PM

my research so far has suggested a large amount of illegal products and services traded online are typically paid for with Bitcoin.

Your research must be limited to reading media hype. Clearly you haven't logged into several of the major criminal blackhat and carding forums or you'd realize bitcoin is a drop in the ocean of so-called "cyber crime". Bitcoin only appears to be the leading payment method for "illegal" transactions, because the media has seized upon it as the boogey-man du jour. Seems you've done no independent research on how criminal networks work outside of reading gawker or CNN.

I would wager that bank transfers using business accounts registered under shell corps, are the most used for 'illegal' transactions, followed by Western Union, followed by Web Money and maybe Liberty Reserve. Fraud teams have dozens of employees with fistfulls of fake IDs to go pick up WU transactions all day long. How do I know this? Cuz they advertise their services everywhere. The shady world of ponzi schemes is all financed with LR and Perfect Money. Sure there was a big ponzi here, but it's miniscule in comparison to the thousand or so ponzi's going on at HYIP investment forums all around the world. Silk Road may be using bitcoin, but there's been a black market for big $$$ bulk narcotics well before SR was around and all of that is done through cash in the mail or shell corporations.

Real criminals exploit the regular payments system because it's easy. Just register a corporation with phantom directors and open up business accounts anywhere you want. One glance at any carding forum cash out services for hire and you wouldn't have bothered with this survey here. You'd already know what they're using. This isn't for a petty few grams of drugs being peddled over Tor, they're cashing out millions in stolen funds every day since the late 1990s.

AML/KYC rules only frustrate legitimate transactions and don't even phase a modern blackhat or pro criminal. Web Money has perhaps, the most restrictive AML system I've ever seen, like requiring you to show up in person to get certain passports for their system to increase your limit yet blackhats are selling unlimited Web Money passports and ATM cards anyways.

More proof that bitcoin isn't the leading choice for criminals is the massive HSBC, UBS, and Standard Charter laundering that was being done for Iran's oil business and Mexican cartels. No bitcoins were involved. You should be writing a thesis on why absolutely nothing happened to these banks besides a fine, whereas if any individual were to do what they did on even a micro scale, they'd be serving life in prison. Prapaharan Thambithurai of Canada was given a prison sentence for raising just $2,000 for the Tamils. These banks laundered untold billions for the ultra violent Zetas and assisted in funding Iran's nuclear program yet it was quietly swept under the rug.

Whilst my research is influenced and partly informed by the media, as any research on not-very-well-documented things is inherently going to be, I've seen (probably the very tip of) some of the sort of forums your talking about, I've seen the adverts selling batches 1000+ credit cards. You seem to be making a great amount of assumptions based on the little information I've provided about my research. I'm aware that my research doesn't include all kinds of crime - as with any research, nothing is perfect. As with any good research, I also have to critically analyse my own results - as well as that, I have to analyse my own methodology and the flaws, including specifying exactly what my research can and cannot be applied to - which would include corporate scale money laundering. I will be have to acknowledge the limitations of approaching crime and from the outside position of a researcher with a time limit, e.g. I'm not going to be able to get right down to the big players in 6 weeks of practical work.

Silkroad has an estimated monthly revenue of over $1million. You're right, even if you scale it up for other sites and boards like SR, it's still a drop in the ocean compared to corporate theft, but it's still an amount, a large amount for some. But just because there are bigger crimes out there, does that mean we should ignore the smaller ones? Stop trying to catch the drink drivers because there are serial killers out there? You're correct the AML/KYC are probably just a tiny blip on the radar of skilled blackhats, but something like that with Bitcoin would pose a big problem to the majority of casual users of SR. (Just for the record, I'm not necessarily supporting AML/KYC laws for Bitcoin.)

It's funny you should mention HSBC. When chatting to one of my colleague about my research in trying to understand what people use to pay for illegal things - he pointed out that I know longer need to do it because the stuff in the news suggests they all use HSBC:)

Quote from: lonelyminer on September 03, 2012, 04:08:43 PM

Quote from: ItsDom on September 02, 2012, 08:40:52 PM

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You have it backwards. The heavier the regulation, the more comparative advantage there is in using alternatives such as Bitcoin in the regulated areas. Legislative liberalisation would slow down Bitcoin adoption.

I'm not entirely sure I understand. Surely it depends on which way the regulation goes. E.g. if the government were to endorse use of Bitcoin through legislation and keeping Bitcoin in it's current form, all the big chains would jump on it. I believe that's very unlikely to happen, but it's not an impossibility. But assuming it did happen, it would pickup millions of users over night - millions of people otherwise unaware of Bitcoin, would be enjoying the same benefits as you by using Bitcoin. I believe there is such a thing as "good legislation" - I'm not so sure how good legislation of Bitcoin will be when it does come around though.

Quote from: Mike Hearn on September 03, 2012, 08:49:11 PM

I think the biggest problem with this thread is the conflation of bitcointalk.org with the Bitcoin community as a whole.

I routinely meet with and trade with people who are using Bitcoin but post here either rarely or never. Attempting to paint all Bitcoin users with the results of a survey of some random forum readers is intellectually illegitimate.

That's a very good point, and in hindsight, should have really been addressed - I should have really sent it out to more places. But it's an inherent problem with an sample - you can't sample anyone. You're right though, I definitely could have got a wider sample in retrospect. I'll be sure to mention that in the analysis.

Thanks for the input - extremely useful and appreciated:)

Quote from: blablahblah on September 03, 2012, 09:06:25 PM

Quote from: Mike Hearn on September 03, 2012, 08:49:11 PM

...

Let's not bash him too much, at least he's trying... Which is more than I can say for all the other "researchers" that we never hear ~~about~~ from. Plenty of self-styled journalists/bloggers have been happy to mock Bitcoin from the safety of their armchairs. They spend 5 minutes reading, decide that it's a ponzi or some other scam, and totally close their mind against any opposing opinions for the rest of their life. Whereas this guy actually asked some questions. It's a freaking miracle!

I appreciate the support:) I discovered Bitcoin out of my own interests. I like it - I don't want to see an end to it. I've committed to spending at least 4 years of my life to formally researching around it (along with other things.)

Despite it being mainly critical, the feedback you're all providing in this thread is incredibly useful and I do welcome it. Valuable input and feedback here will help shape the way I conduct future research, hopefully with you folk:)

ItsDom

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