[cryptome] Re: 1st British Bitcoin Exchange due to open

  • From: Peter Presland <peter@xxxxxxxxxxxxxx>
  • To: cryptome@xxxxxxxxxxxxx
  • Date: Sat, 11 Apr 2015 14:30:31 +0100

Hi Doug

On 11/04/2015 11:30, Douglas Rankine wrote:

May I say, it isn't a competition between you and I, or anyone else for that
matter, rather, we are sharing information and your contribution was very
good stuff, in my opinion, I learnt quite a lot from it.

By 'compete', I was referring only length which facilitates proper
exploration of the multiplicity of facets that comprise an extremely
complex subject. I cannot compete on word-count and so cannot really do
the subject justice IOW. It's a time and other commitments thing, that's

Just a couple of points, all currencies have to "cash out" i.e. get turned
into another currency or realise their value through exchange for goods or
services. See Capital Vol 1 by K. Marx or The Wealth of Nations by Adam
Smith, for a definition of capital value. If they don't cash out they are
worth nothing, or hypothetical billions. That is if I am understanding what
you mean by cashing out.

My usage specifically excluded 'exchange for goods and services'. It is
the practical necessity (currently) of exchanging Bitcoins for $ £ etc
and vice-versa (itself a function of the paucity of goods and services
currently exchangeable for Bitcoin) which is a fundamental obstacle to
wider Bitcoin take-up - a classic 'Catch-22' IOW. The reason is simple,
currency exchange on any serious scale requires gateways - all such
gateways can be (and are) both monitored and controlled by Gatekeepers
who report to said 'Financial Authorities' - or else! Think about that -
big subject with big ramifications. Even if Bitcoin were as anonymous as
cash (and I accept that it isn't) the gatekeeper network tells the FAs
pretty much all they need to know about who is using the currency and
for what purposes. That is the current position. For goods and services
exchange, it is loosely analogous to cash but with the following (among
many) differences:

Advantage: Fee-less electronic transmission including across national
boundaries. Unlike fiat money the actual transmission does not rely on
ANY third party - official or otherwise.

Disadvantage: Exchange into and out of a tightly regulated currency is
necessary with all that implies - a problem that most users of cash do
not face (unless they want to emigrate).

OK, my 'shit-scared' characterisation is arguably a bit OTT. However, I
am still sufficiently connected to the 'Financial capitalism' world to
know that it regards maintaining and tightening control over
crypto-currencies as seriously as it views its control over existing
fiat currencies and that to do so poses a whole raft of tricky technical
problems. Like I said; they're working on it.

In fact, though a wonderful piece of mathematical invention, it is
quite useless, like all good art...to paraphrase Oscar Wilde... :-).

A couple of points to ponder:

1. The FBI + various 'authorities' probably already control a sufficient
proportion of total mined Bitcoin to manipulate its 'value' (viz-a-viz
$,£ etc) in whatever fashion is judged to best serve the interests of
the existing fiat-based capitalist system.

2. Since cash is becoming increasingly embargoed (in UK/Europe anyway)
for transactions above a few K's - and with all the
printing/distribution/accounting problems of cash, I would not be at all
surprised if Bitcoin - or the technology underpinning it - did not soon
to find its way into OFFICIAL cash-replacements.

In any event, AFAIAC Bitcoin is certainly NOT useless, if only because
my Wikispooks site has received more donations in Bitcoin over the past
12 months than it has in any other currency - and I have no problem
either spending or exchanging it either. I know Big Brother is watching
me; but so what? - he's watching you too.


P.S. I notice that some peer to peer organisations are putting bit mining
into their sharing systems...without asking permission...Lots of folks
aren't very pleased about it...including me...I don't have enough bandwidth
as it is, without sharing it surreptitiously. Now, that is something to be
shit-scared of... :-).

-----Original Message-----
From: cryptome-bounce@xxxxxxxxxxxxx [mailto:cryptome-bounce@xxxxxxxxxxxxx]
On Behalf Of Peter Presland
Sent: 08 April 2015 16:51
To: cryptome@xxxxxxxxxxxxx
Subject: [cryptome] Re: 1st British Bitcoin Exchange due to open

On 08/04/2015 15:29, John Young wrote:
Odd that Bitcoin users believe its anonymity features, as though
exchanges occur in the untappable, invisible, untrackable byways of

What better way to track bitcoin users than anonymizing bitcoins.

I can't compete with Dougie's epistle about technical Bitcoin
anonymity/Authorities matters. Suffice to say that my post was primarily to
point out a couple of misunderstandings - misunderstandings which I now
suggest evidence a lack of familiarity with the issues and may therefore
affect his speculations.

However, my 'shit-scared' characterisation had nothing to with the alleged
anonymity (or lack thereof) of Bitcoin transactions.

The thing that really bothers the financial authorities is the absence of
centralised control over issuance and all that flows from it. Since Bitcoin
issuance is known and finite, it is analogous to gold as a currency but with
none of its storage and exchange problems. How to exercise a similar degree
of control over Bitcoin value and flows, that is their problem and they are
working on it.

Bitcoin take-up remains constrained by the need to cash-out. So long as that
is so, then its use will likely remain confined to the fringes. The
financial authorities absolutely need to be able to prevent any serious
break-out from this constraint and they don't appear to have a plan - yet.
Hence my 'shit-scared' remark.

OTOH, the Powers that drive the NSA (ie those who also pull the strings of
the ones who are 'shit-scared') have almost certainly got the whole thing
well in hand - even designed it this way :-)

Mr Nakamoto may indeed be a maverick but co-opting the technical brilliance
of mavericks (among its vast array esoteric capabilities) is after all an
NSA speciality.


Recalls the case of Crypto-AG being rigged by NSA to spy on its crypto
machines. Or Tor and Snowden implementing digital Crypto-AGs.

Still, biblical faith in unverifiable protection is as ancient as
authority warnings of enemies at the gate, in the soul, in the private

Not to mention invention of money and taxes conjoined to
mortality: death taxes a great way to assure filled tills.

But no authority can survive without porn, liquor and gambling.
And heavy-handed alarms about their danger if not carefully controlled
to assure dependency on defiance of authority.

Cheating humans is supremely human.

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