[Bitcoin-development] A look back and a look forward

[21E14 <21xe14@gmail.com>]

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Alex Daley recently stated that "one of the problems with Bitcoin is that
it takes us backwards in the transaction chain. Suddenly, you're dealing
with something that's much more cash-like. If Target had been hacked, and
instead of using credit-cards, what was stolen from them were actually
bitcoins, that they have been storing Bitcoin addresses in their systems
and those systems were compromised, Target wouldn't just have a PR
nightmare in their hands. They would be out of business."

Of course, it needn't be Target. The scenario has played out with a number
of exchanges, and is a sword of Damocles hanging over the cryptocurrency
space. The recent Winklevoss Bitcoin Trust SEC filing warns that "the
Trust’s bitcoins may be subject to loss, damage, theft or restriction on
access. There is a risk that part or all of the Trust’s bitcoins could be
lost, stolen or destroyed. The Sponsor believes that the Trust’s bitcoins
held in the Trust Custody Account will be an appealing target to hackers or
malware distributors seeking to destroy, damage or steal the Trust’s
bitcoins. Although the Security System’s design includes various elements,
such as redundancy, segregation and cold storage, to minimize the risk of
loss, damage and theft, neither the Custodian nor the Sponsor can guarantee
that the Security System will prevent such loss, damage or theft..."

This needn't be so, once an optional identity layer, modeled after the
Internet itself, is provided, as proposed in late August of last year on
this mailing list:

http://sourceforge.net/p/bitcoin/mailman/message/32737796/
http://sourceforge.net/p/bitcoin/mailman/message/32742809/

I hope it is apparent that this is the killer app folks have been searching
for in vain. Like its Internet analogues, BCIs will not be created
overnight and without collaboration - and TNABC is as good a place as any
for it.

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