Yes, I think my schadenfreude is for you.

Generally not a good trait to have, particularly not with something that has a tendency to bounce back.

http://arstechnica.com/tech-policy/2011/10/bitcoin-implodes-...

Were you that guy in 1989?

"My schadenfreude is for all of the people who smugly told us for years that ARPANET is superior to our 'legacy' post office and ham radio in every way"

People in 1989 didn't exhibit a nearly religious devotion to ARPANET as perfect in every way, going so far as to say things like "Bitcoin cannot fail, it can only be failed" (do people realize how absurd this sounds?)

When every one of Bitcoin's characteristics (deflationary money supply, irreversibility of transactions, completely public record) is touted as an unmitigated advantage, it is irritating to those of us who see it as an interesting idea and cool technology with both plusses and minuses.

ARPANET isn't superior to post offices in every way; for example you can't send a package through ARPANET. And in fact one of the Internet's biggest winners Amazon.com built its success largely on being really good at shipping.

I understand a certain irritation with a lot of "Bitcoiners", but don't let contempt of Bitcoin extremists make you an anti-Bitcoin extremist.

Where did you get "anti-Bitcoin extremist" from any of what they wrote?

I didn't necessarily, it's just a precaution. I see a lot of vitriol directed at Bitcoin, and this sort of extremist overcompensation is really nothing new anyway. It's just a reminder to stay rational.

> People in 1989 didn't exhibit a nearly religious devotion to ARPANET as perfect in every way, going so far as to say things like "Bitcoin cannot fail, it can only be failed" (do people realize how absurd this sounds?)

I actually agree with you, but if you're talking about me, I was being wildly sarcastic and riffing off of an old Communist slogan. I'm not aware of anyone who's ever said that sincerely, but if someone did it would be hilarious.

That would be a good analogy if we couldn't transfer money online. But, you know, we can.

The whole point of Bitcoin that's been touted in pretty much every thread, hoisted up by Libertarians like a giant flag, is that it's unregulated. And now, they're all discovering why we regulated in the first place.

yes, and regulated banks/exchanges have never been the centre of financial disasters.

Not that there haven't been failures, but in the US, bank customers -- as opposed to bank shareholders or investors -- are a fairly protected class.

In 2008(?), Lehman investors were fucked, WaMu shareholders were fucked, but as a WaMu customer I was not inconvenienced in the slightest. My money was safe and I was able to freely access it every day during the transition to Chase ownership.

Now, I don't think that it is fair to compare MtGox to a bank. It was really an exchange for investors to speculate on fluctuations in exchange rates, so in the regulated financial industry you'd probably be just as fucked.

I think the take-home message from the failure of MtGox is that your risks don't just come from the volatility of the market you are investing in. You could lose your money through a crash in the market, yes, but you could also lose your money through the incompetence or malfeasance of your investment partners, through having your password stolen and your account hacked, through losing your private keys, ... If you only consider one type of risk, you will understate your total risk, and not hedge against it effectively.

It's this kind of thinking that really irks me. "Well, my $100 still adds up to $100, so it's all there."

Yeah, you money is there. Maybe it holds the same value as yesterday, or tomorrow. But over time, your taxes will go up, prices of things you buy will go up, inflation will rise, and the spending power of your $100 will become less and less.

Every bank failure, financial meltdown, and economic downturn robs your money of value. When a meltdown happens, and the FED has to prints more money to cover it up, your dollar loses value. When the price of merchandise goes up, because fees go up, because bank insurance premiums rise, because they keep losing your money, your dollar loses value.

It may happen slowly and indirectly, but make no mistake, you are losing you money. The best way to cook a frog is to do it slowly, so the frog doesn't jump out of the pot.

actually the latest banking disaster was largely due to a decade prior of deregulation, and the economies of other counties who came through it best had retained a lot of their regulation (Canada).

"Bitcoin cannot fail, it can only be failed."

Cash isn't really a reasonable analogy in this case, since it can't be transferred digitally and needs to remain in the custody of the owner. BTC held in exchanges is much more comparable to money in demand deposit or savings accounts.

Exactly how does this differ from the regular banking sector? I can demand 'proof' (whatever that might mean in this case) from Barclays that their books are balanced, but it doesn't mean they'll give it to me.

But they will give it to the regulators.

And that is the point. Bitcoin as an open system means we are ALL the regulators. Issue is we cant see their FIAT.

How are we regulators? How can we demand anything from any enxchange? How can we punish them if they violate the rules, or our trust?

If Mt Gox has a single deposit wallet for example, we could easily audit how many coins it has.

We couldn't enforce rules, but if some people decided to set up a sort of "best practices" website saying it's "SAFE compliant or something (Sure Against Forged Equalities), in which case beginners guide would be "ALWAYS GO FOR SAFE COMPLIANT EXCHANGES!"

We couldn't punish them but it would allow some sort of feeling of safety(if minimal).

I think that is the whole issue with this.

They are beholden to no one and there is no way to punish them if they violate the rules. (rules in the BTC world?! blasphemy!)

If we can regulate them, so can the government. AFAIU Bitcoin is designed to prevent exactly that, at least in general.

Fully resolving their books would require knowing identities of those entitled to receive Bitcoin from an exchange, as only one example, as otherwise an exchange could simply transfer the right amount to an account under their control and use those Silk Road-style money laundering schemes to transfer it to some wallet they actually care about.

To make sure the outlays went to the customers it's required to know which Bitcoin wallets belong to said customers. Are you going to sign up for an exchange that maps wallet IDs to customer identities for public transparency purposes?

> If we can regulate them, so can the government.

Even if we can't, the government still can if it really wants to. They can still demand access to the software, the wallets, and they can fine or imprison people.