I WannaCry about the Plunging Quality of Evil Geniuses

I have something to confess; I have no patience or sympathy for idiots. When imbeciles impale themselves on reality I smirk and guffaw. With such a nasty attitude it won’t surprise you to learn that I really enjoyed the recent WannaCry Ransomware cyber attack. Judging from the mewling soiled diaper press you might conclude civilization was dealt a death-blow and that idiot Trump is to blame.

What really happened?

  1. The NSA “cataloged”1 a security flaw in Windows XP and didn’t inform anyone.
  2. The flaw was leaked.
  3. Hackers exploited the flaw to infect old Windows computers.
  4. They encrypted files and tried to ransom victims using Bitcoin.

It’s stupid all the way down!

To begin, Windows XP is ancient. Microsoft spent years warning people to upgrade to more current versions of Windows. The warnings went on for years and years and years. Yet despite this relentless nagging an army of morons refused to upgrade. Now these shiftless dolts are blaming others.

“Microsoft should support obsolete crap forever for free.”

“Teresa May didn’t give us enough money to upgrade our computers.”

“What’s the point of rudimentary computer security when Trump is going to nuke us?”

Most WannaCry victims are suffering self-inflicted wounds. Let’s hope some of them bleed to death.

As for the NSA, that festering hive of evil geniuses, you would think they would have learned something from the strong encryption battles and the Snowden affair but apparently not. Judging from recent history the NSA stands for NOT SECURE AGENCY. They’re leaking more than a menstruating woman without sanitary napkins. The entire notion of stockpiling software defects to use at a later date is cosmically stupid because it presumes software is static. Software is always changing: sometimes for good reasons. Your backdoor will probably close with the next compiler or OS release. Some quality assurance drone may notice your favorite backdoor and release a patch. This happens all the time, just read the notices that accompany standard updates and patches. At best stockpiling defects is a short-term tactical gimmick. Frankly, I expect more from the deep thinkers at the NSA.

It’s sad but evil hacking geniuses still depend on dumb users. The odds of obsolete, unsupported, and unpatched software being able to fend off NSA hacks is low but it rapidly approaches zero when dimwitted dolts respond to phishing attacks. How many “don’t click on unsolicited links” warnings must be issued before corporate cubicle warmers smarten up?

“But if I don’t click on this link I might miss consuming more useless crap?”

Finally, using Bitcoin for ransom purposes is unbelievably stupid.

WannaCry hackers you’re using the wrong cryptocurrency!

The Bitcoin blockchain is darn close to a perfect forensic tool. Once a transaction is recorded on the chain it can never be altered, erased, denied or fudged. You’re dropping indestructible breadcrumbs. It’s an audit trail on steroids. It’s like the idiot WannaCry hackers want to be caught!

Many feeble minds still think Bitcoin is anonymous. This was sort of true in the very early days of Bitcoin when nobody gave a shit about it and no serious money was changing hands. The world has changed. Bitcoin has been outperforming all fiat currencies for the last two years. A single coin is now worth more the $1,700 US – more than an ounce of gold. Serious money is now changing hands in the Bitcoin universe and when serious money is present the usual financial rapists and apex predators, your local taxation authorities, descend like vultures on a carcass.

Because the blockchain is immutable and open it’s relatively easy to de-anonymize. An entire software industry has sprung up to do just this. Once you associate a person with a Bitcoin address you can easily and reliably follow the money. De-anonymizing Bitcoin has been going on for years. I just assume the entire blockchain is already de-anonymized which makes Bitcoin just about the worst possible choice for ransoms.

Despite all the amusing stupidity on display here, the WannaCry hack has inadvertently established a proper baseline test for an advanced privacy preserving cryptocurrency. A proper private and secure cryptocurrency should be a nearly perfect money laundering tool! I’m looking forward to the day when real evil geniuses, not WannaCry wannabes, stage a massive ransomware attack, collect a massive butload of untraceable coin, and then spend it right under the noses of the word’s taxation and intelligence agencies. When this glorious day arrives we, the little wage slaves, the deplorables, the lumpen-proletariat, will finally have some financial privacy! Remember, if your money isn’t free then neither are you!

Until then I just WannaCry!


  1. It’s not clear they discovered the flaw but however it was found they withheld it.

Parsing the Bitcoin Genesis Block with J

The genesis block is the first block on the Bitcoin blockchain. Satoshi Nakamoto, the mysterious entity that created Bitcoin, mined the genesis block on January 3, 2009. It’s been five years since the genesis block’s birth and Satoshi is still unknown, Bitcoin is bigger than ever, and the blockchain is longer than 300,000 blocks and growing.

One of the most important features of the blockchain is its immutability. After the Bitcoin network accepts a block and adds it to the blockchain it can never be altered. This makes Bitcoin blocks rare durable binary artifacts. The cryptographic hash algorithms that underpin the Bitcoin protocol enforce block immutability. If someone decides to tinker with a block, say maliciously flip a single bit, the block’s hash will change and the network will reject it. This is what makes it almost impossible to counterfeit Bitcoins. Bitcoins have been lost and stolen but they have never been successfully counterfeited. This sharply contrasts with funny money like the US dollar that is so routinely and brazenly counterfeited that many suspect the US government turns a blind eye.

The exceptional durability of Bitcoin blocks, coupled with the mysterious origins of Bitcoin, makes the genesis block one of the most intriguing and important byte runs in the world. This post was inspired by the now defunct post 285 bytes that changed the world. I would love to give you a link but this post has vanished. A secondary, but excellent reference is John Ratcliff’s How to Parse the Bitcoin BlockChain. I am adapting John’s nomenclature in what follows.

When programmers start exploring Bitcoin they often cut their teeth on parsing the genesis block. If you Google “blockchain parsing” you’ll find examples in dozens of programming languages. The most popular are C, C++, Java, PHP, C#, JavaScript, and the rest of the mainstream suspects. What you will not find, until now, are J examples.

So what does J bring to the table that makes yet another genesis block parser worth a look? Let’s take a look at Bitcoin addresses. The following is the Bitcoin address of this blog’s tip jar. Feel free to send as many Satoshis and full Bitcoins as you like to this address.

   tip=. '17MfYvFqSyeZcy7nKMbFrStFmmvaJ143fA'

There is nothing deep or mysterious about this funny string of letters; it’s just a plain old number in Bitcoin base 58 clothing. So, what is this number in standard format? Here’s how it’s calculated with J.

   BASE58=. '123456789ABCDEFGHJKLMNPQRSTUVWXYZabcdefghijkmnopqrstuvwxyz'
 
   dfb58=. 58x #. BASE58 i. ]
 
   dfb58 tip
 1709618896654985460726422911112500711652231559804656492485

The second line that defines dfb58, (decimal from base 58), is the complete J program! That’s it folks. You can troll the internet for days looking at base 58 to big integer converters and it’s unlikely you will find a shorter or more elegant conversion program. Not only is the J version short and sweet it’s also fast and versatile. Suppose you wanted to convert ten thousand Bitcoin addresses. The following converts ten thousand copies of tip.

   dfb58 10000 # ,: tip
 1709618896654985460726422911112500711652231559804656492485 17096188966549854607264...

At this point fanboys of mainstream programming languages typically pipe up with something like, “changing number encodings is inherently trivial; what about something more demanding like going the other way, say converting Bitcoin public keys to the base 58 address format?”

The public key in the genesis block is encoded in what many call the “challenge script.” Here is the genesis block’s challenge script in hex.

41 04 67 8A FD B0 FE 55 48 27 19 67 F1 A6 71 30 B7 10 5C D6 
A8 28 E0 39 09 A6 79 62 E0 EA 1F 61 DE B6 49 F6 BC 3F 4C EF 
38 C4 F3 55 04 E5 1E C1 12 DE 5C 38 4D F7 BA 0B 8D 57 8A 4C 
70 2B 6B F1 1D 5F AC

Public keys take a number of forms in the blockchain. John Ratcliff’s post summarizes the many forms you will run into. The genesis block uses the 65 byte ECDSA form. Converting this form to base 58 requires taking SHA-256 and RIPEMD-160 hashes. These hashes are available in OpenSSL which is conveniently distributed with J 8.02 JQT. Here’s how to convert the genesis block’s public key to base 58 with J.

   load 'c:/bitjd/scripts/sslhash.ijs'

   Base58frKey65=:3 : 0

   NB.*Base58frKey65 v-- 65 byte public Bitcoin key bytes to base 58.
   NB.
   NB. monad:  clB58 =. Base58frKey65 clBytes

   ekey=. (0{a.) , sr160 s256 y
   csum=. 4 {. s256 s256 ekey
   Base58Check ekey,csum
   )

   Base58frKey65 }. }: ChallengeScript
 1A1zP1eP5QGefi2DMPTfTL5SLmv7DivfNa

The ChallengeScript noun holds the bytes given in hex above. The verbs sr150, s256 and Base58Check are available in the J scripts sslhash and ParseGenesisBlock that I have put in the jacks repository on GitHub.

The following J verb ParseGenesisBlock reads the first full node Bitcoin block file and then extracts and checks the genesis block. ParseGenesisBlock tests the various verbs, (functions), it employs. As a side effect it clearly describes the layout of the genesis block and provides test data for anyone that’s interested.

If this post peeks your curiosity about J a good place to start learning about the language is the recently released New Dictionary of J. You can download a version of J for Windows, Linux, OS/X, IOS, and Android at Jsoftware’s main site.

ParseGenesisBlock=:3 : 0

NB.*ParseGenesisBlock v-- parse and check Bitcoin genesis block.
NB.
NB. monad:  clMsg =. ParseGenesisBlock clBlockFile
NB.
NB.   file=. 'c:/bitjd/blocks/blk00000.dat'
NB.   ParseGenesisBlock file

NB. fetch genesis block data
dat=. read y

NB. first 4 bytes are "sort of" block delimiters
MagicID=: (i. offset=. 4) { dat
'MagicID mismatch' assert 'F9BEB4D9' -: ,hfd a. i. MagicID

NB. next 4 bytes gives following block length
offset=. offset + 4 [ BlockLength=: _2 ic (offset + i. 4) { dat
'BlockLength mismatch' assert 285 = BlockLength

NB. next 4 bytes block format version - has changed
offset=. offset + 4 [ VersionNumber=: _2 ic (offset + i. 4) { dat

NB. next 32 bytes is previous block hash - genesis block
NB. has no previous hash and all bytes are set to 0
offset=. offset + 32 [ PreviousBlockHash=: (offset + i. 32) { dat
'PreviousBlockHash mismatch' assert (32#0) -: a. i. PreviousBlockHash

NB. next 32 bytes is the Merkle tree root hash
offset=. offset + 32 [ MerkleRoot=: (offset + i. 32) { dat
grh=. '3BA3EDFD7A7B12B27AC72C3E67768F617FC81BC3888A51323A9FB8AA4B1E5E4A'
'MerkleRoot mismatch' assert grh -: ,hfd a. i. MerkleRoot

NB. next 4 bytes is a unix epoch timestamp - rolls over 7th feb 2106
NB. there is no timezone information - it is interpreted as utc
offset=. offset + 4 [ TimeStamp=: _2 ic (offset + i. 4) { dat
'TimeStamp mismatch' assert 2009 1 3 18 15 5 -: ,tsfrunixsecs TimeStamp

NB. next 4 bytes represents block target difficulty
offset=. offset + 4 [ TargetDifficulty=: _2 ic (offset + i. 4) { dat
'TargetDifficulty mismatch' assert 486604799 = TargetDifficulty

NB. next 4 bytes is a random number nonce
offset=. offset + 4 [ Nonce=: (offset + i. 4) { dat
'Nonce mismatch' assert '1DAC2B7C' -: ,hfd a. i. Nonce

NB. next 1 to 9 bytes is the transaction count stored as a variable length integer
NB. see:  https://en.bitcoin.it/wiki/Protocol_specification#Variable_length_integer
offset=. offset + vlen [ 'vlen TransactionCount'=: vint (offset + i. 9) { dat
'TransactionCount mismatch' assert TransactionCount = 1  NB. (*)=. vlen

NB. next 4 bytes transaction version number
offset=. offset + 4 [ TransactionVersionNumber=: _2 ic (offset + i.4) { dat
'TransactionVersionNumber mismatch' assert 1 = TransactionVersionNumber

NB. next 1 to 9 bytes is the number of transaction inputs
offset=. offset + vlen [ 'vlen TransactionInputNumber'=: vint (offset + i. 9) { dat

NB. next 32 bytes is the hash of the input transaction
offset=. offset + 32 [ TransactionHash=: (offset + i. 32) { dat
'TransactionHash mismatch' assert (32#0) -: a. i. TransactionHash

NB. next 4 bytes is the input transaction index
offset=. offset + 4 [ TransactionIndex=: _2 ic (offset + i. 4) { dat
'TransactionIndex mismatch' assert _1 = TransactionIndex

NB. input script length is next
offset=. offset + vlen [ 'vlen InputScriptLength'=: vint (offset + i. 9) { dat
'InputScriptLength mismatch' assert 77 = InputScriptLength

NB. script data
offset=. offset + InputScriptLength [ InputScript=: (offset + i. InputScriptLength) { dat

NB. sequence number 4 bytes
offset=. offset + 4 [ SequenceNumber=: ,hfd a. i. (offset + i. 4) { dat
'SequenceNumber mismatch' assert 'FFFFFFFF' -: SequenceNumber

NB. output count 1 to 9 bytes
offset=. offset + vlen [ 'vlen OutputCount'=: vint (offset + i.9) { dat

NB. output value - number of satoshis sent
offset=. offset + 8 [ OutputSatoshis=: (offset + i.8) { dat  NB. 64 bit unsigned integer
'OutputSatoshis mismatch' assert '00F2052A01000000' -: ,hfd a. i. OutputSatoshis
OutputSatoshis=: ]`(_3&ic)@.IF64 OutputSatoshis

NB. challenge script length
offset=. offset + vlen [ 'vlen ChallengeScriptLength'=: vint (offset + i.9) { dat
'ChallengeScriptLength mismatch' assert 67 = ChallengeScriptLength

NB. challenge script - contains elliptic curve signatures
offset=. offset + ChallengeScriptLength [ ChallengeScript=: (offset + i. ChallengeScriptLength) { dat
'ChallengeScript mismatch' assert GenesisBlockChallengeScript -: ,hfd a. i. ChallengeScript

NB. challenge script is 67 bytes drop first and last byte to
NB. compute the familiar Bitcoin base 58 address - compare with block explorer
NB. http://blockexplorer.com/block/000000000019d6689c085ae165831e934ff763ae46a2a6c172b3f1b60a8ce26f
OutputAddress=: Base58frKey65 }. }: ChallengeScript
'Genesis Block address mismatch' assert GenesisBlockOutputAddress -: OutputAddress

NB. last 4 bytes lock time
TransactionLockTime=: (offset + i.4) { dat
'TransactionLockTime mismatch' assert 0 0 0 0 -: a. i. TransactionLockTime

'Genesis Block Parsed and Checked'
)

Your Bitcoins are Now Welcome!

Recently Coinbase introduced payment pages. Here’s my page. Payment pages simplify the process of paying with Bitcoins. In the last six months more and more businesses have started accepting Bitcoins. Once people get cryptocurrencies they inevitably start questioning the legitimacy of national currencies. This is all good. National currencies are part of the past.  It’s embarrassing to trade debased presidents or unnecessary queens for goods.

I now pay online fees with Bitcoins when I can. I am doing this for three reasons.

  1. Bitcoin payments are orders of magnitude more secure than credit cards, PayPal or other online payment methods. When you pay with Bitcoins you don’t spread personal information around. Bitcoin is a nightmare for identity thieves.
  2. I want to encourage the widespread adoption of Bitcoin as a payment technology. The entire parasitic financial class must be reformed or destroyed. A good way to kill something is to cut off its air supply. When you use credit cards a big cut goes to banks. Why enrich what you hate? Bitcoin, and its brethren, will help suffocate traditional banks and their despicable government cronies.
  3. The era of government backed legal tender is drawing to an end. Money is way to important to allow governments to control it. Abominations like the Federal Reserve are as obsolete and morally repugnant as slavery.

To help bring about the glorious day when shitheads in government no longer create money out of thin fucking nothing and give it to their bum buddies I am encouraging all of you to start using cryptocurrencies. You can start by tipping moi!

Review: The Creature from Jekyll Island

jekyllislandIn 2008 whatever residual trust I had in American democratic institutions was irrevocably shattered by the larcenous and criminal bank bailout. If you recall the bailout, the infamous “crap sandwich”, was overwhelmingly opposed by the public, initially rejected by Congress, but stuffed down our throats anyway. The sky was falling! The banks had to be saved or the world would end. At the time I knew the failure of half a dozen of world’s largest banks would be a disaster – for bankers – and many innocent bystanders, but it was hardly world ending. Asteroids weren’t falling, super volcanoes weren’t erupting, nukes weren’t detonating, in the worst case we would have a short sharp, parasite cleansing, depression followed by the growth of new financial institutions. This is exactly what happened – in Iceland: the only country that refused to bail out their banks. The reward for poor judgment, bad planning and mendacious behavior should be failure. Of course that is not what happened. That ultimate get out of jail free institution, The Federal Reserve, kicked into high gear and rescued a host of institutions that should no longer be with us. It was a complete undemocratic travesty.

I thought the 2008 bailout was an exception; that the entire outrageous chain of events was pulled out of the asses – of asses – on the fly. Edward Griffin’s “crazy” history of the Federal Reserve, written more than a decade before 2008, clearly shows that the only exceptional thing about 2008 was scale.  The Federal Reserve has been saving banker’s butts for a century. As long as we have, fiat currency, fractional reserve banking and central banks like the Federal Reserve we’ll have, massive government debts, never-ending inflation, (money creation), and the relentless insidious transfer of the costs of bank screwups to an unsuspecting and stupid public. This is the way the system is supposed to work! Griffin’s footnotes make it clear this was completely understood by the originators of the Federal Reserve over a century ago. In short, the “Jekyll island creature” has pulled off the biggest bank job in history.

Most of The Creature from Jekyll Island recounts the fascinating history of central banking in the United States with entertaining asides into the longer history of money. For millennia “money” was largely precious metals: Gold and Silver.  There are good, very long-standing historical reasons,  for this. Even today, given the choice between a pile of paper dollars and the equivalent amount of Gold, most of us would still take the Gold. You would think something that has functioned for five thousand years as global money would be good enough for central bankers but Gold, in the duplicitous language of bankers and their economist fanboys, is insufficiently elastic. What this means is that Gold cannot be created and destroyed by banker will alone.  Barbaric old unreactive Gold, forged in the collision of neutron stars, and unevenly dispersed in the interstellar medium, is just too damn hard to acquire and use as money. What’s needed is something that can be “poofed” into being on demand.

On course the problem with poofed, or fiat, money is getting poor dumb suckers to accept it. That’s where the legal tender laws come in.  Central bankers are only one side of the bailout ballet. The bankers need the power of the state, with its ability to imprison and execute anyone that balks at taking colored paper for Gold, or gets the silly idea that they can print some colored paper themselves, to really work the fiat magic. In return the state gets preferential access to newly created, tax levy free, funds to piss away on vote-buying boondoggles. It’s a great system for bankers, politicians and their many blood sucking ticks. It’s a shame the rest of us get inflation raped paying for it.

Griffin ends his book with two flights of conspiratorial lunacy: one pessimistic and the other realistic. If you’re wondering, Griffen holds there is no optimistic scenario. We’re in for a world of economic butt-hurt when the creature dies. The pessimistic scenario is basically 1984 central banker style and the realistic outlines the economic disruptions required to return to a silver based dollar. Griffin is a better historian than a science-fiction writer and Jekyll would be a better book without the last two chapters.

Finally, I disagree that there is no optimistic scenario, but I can forgive Griffin for not seeing one twenty years ago. In 1994 there were no new ideas about money: just the same old fiat crap served up on plastic credit cards. In 2014 we have Bitcoin. I hold that the ideas in Bitcoin are the first genuine monetary innovations in many decades. The Bitcoin network demonstrates how a “nonpoofed” form of sound money can work without governments or central bankers. Economists are fond of quoting Gresham’s law: “Bad money drives out good.”  With ideas it’s the exact opposite: “Good ideas drive out bad.” Let’s hope the exceedingly bad Federal Reserve idea succumbs to better ideas like Bitcoin as soon as possible.

Bitcoin is a Perfect Protest

VbitcoinThe most intelligent comment I have read about Bitcoin is that it’s a perfect protest. Bitcoin went live in 2009 shortly after the 2008 financial crisis. The 2008 crisis was a defining moment. Prior to that date I believed that the US government, despite its obvious warts, short comings and long checkered history was still partly accountable to the electorate.  I didn’t buy the widespread cynical notion that modern elections are largely meaningless dog and pony shows that help sell the illusion that the people are in charge. I seriously thought there were important differences between Barak Obama, Hillary Clinton and John McCain. It’s embarrassing to confess such naivety.

Before 2008 I was a good little cog in the machine: obediently paying my taxes and being a productive member of society. I was a chump: a silly stupid chump, but lucky for me, the “crap sandwich” bank bailout cured my naivety. Despite being overwhelmingly rejected by the public and initially rejected by Congress the crap sandwich was forced down our throats and all three presidential contenders voted for it.  When push came to shove there were no significant differences between liberal democrats and conservative republicans, both groups lined up to betray and indebt the public and we’ve been suffering, and will continue to suffer, the consequences for years to come.

The 2008 financial crisis, and the comical US election that followed it, taught me some important lessons:

  1. If none of the above is not on the ballot the election is fraudulent. The political systems in the countries I have lived in depend on presenting limited, and frankly insulting choices, to the electorate. If anyone is going to seriously argue that Barak Obama and John McCain were the best that a country of three hundred million souls could offer then we are lost. If I was lost in the woods with Obama and McCain I wouldn’t take a millisecond of direction from either and might consider getting rid of them on the spot to improve my chances of survival. A candidate must be better than nothing, and if nothing is superior to the highly gamed political selections put forward then nothing should be on the ballot! I will return to this theme in future posts. The next time you cast a ballot look for none of the above. If none of the above is not present the election is illegitimate and you are being used to put a stamp of public approval on what’s very probably a vacuous choice.
  2. You can tell we’re dealing with a real issue when the ruling class closes ranks. Our idiotic media maelstrom is inconsequential noise that is best ignored.  Will a society with gay marriage manage their finances better than a society without gay marriage?  Will free birth control pills for sluts impact trade balances? Will crosses on public lands constrain money creation?  Does the size of Kim Kardashian’s ass moderate capital controls?  Get in the habit of asking such questions. If the question is absurd, or if the answer doesn’t matter, it’s a distraction.  On the other hand if you see alleged ideological enemies coming together to promote a critical common good beware! In 2008 the flamboyant cosmetic differences between liberals and conservatives vanished removing even the illusion of choice. To bailout, or not bailout, was a real issue and with real issues there is no choice. We’ve recently witnessed rank closing on Edward Snowden. Again, both left-wing democrats and right-wing republicans lined up to declare Snowden a traitor and praise the glories of our NSA surveillance state. Clearly public privacy is another real issue and with real issues there is no choice.
  3. Human beings cannot be trusted with money creation.  The 2008 bank bailout was outrageous for two primary reasons. It lavishly rewarded bad behavior and it created money to do it. Money creation is convoluted; many argue that commercial banks create the bulk of money through loans, others claim the Federal Reserve creates money when buying government bonds and treasuries. The food chain is twisted but nobody disputes that at the base of the chain money is created out of nothing. Everything boils down to ledger entries made by sanctioned authorities. There is no mining, there is no collateral, there’s nothing but an invisible yoke that’s eventually placed on the public’s head. The invisible yoke has briefly shown itself in the fiery debt limit fights about the full faith and credit of the United States. What the hell is the full faith and credit of the United States? It’s nothing more than a promise that the government will somehow extract the means to make payments to that long forgotten ledger entry. If the public fully understood that their labor is balanced against nothing they would refuse to pay and the entire system would collapse. The system is such a perfect scam it’s hard not to admire it. Oh, it will eventually collapse; fiat money always goes to zero, but in the meanwhile it affords unlimited fiscal flexibility to the ruling class. Who gets to create money is a real issue and once again there is no choice about real issues.

There has been a lot of nonsense written about Bitcoin but one thing is clear it serves as a brilliant financial foil so I am not surprised to see recent worldwide efforts to suppress it. The most frightening thing about Bitcoin is that it gets people asking questions about money. For example:

  1. Exactly what is money?  Every crank has their own definition of money. What amuses me is that both Gold cranks and fiat cranks have lambasted Bitcoin for being arbitrary and made up. One of the best retorts to this confused drivel notes that Bitcoin is to “real money” like the Flying Spaghetti Monster is to “real religion.” Everyone sees the Flying Spaghetti Monster is made up, but – oddly – nobody can mount rational arguments explaining why it’s more made up than the “real thing.” Bitcoin is capable of playing the role of money, so in proper contexts it is money.
  2. Why do banking authorities have exclusive money creation rights? The historic rationale was to prevent counterfeiting. Counterfeiting is irresistible to anyone in a position to do it. By giving money creation rights to select authorities and using deadly force on counterfeiters governments could claim they were protecting the “currency of the realm.” It is many orders of magnitude more difficult to counterfeit Bitcoins than US dollars or any national currency. To counterfeit a Bitcoin you have to break a hard cryptographic hash.  Technology has rendered the rationale for central money creation authorities obsolete.
  3. Should money be created without limit from nothing? Now that monetary creation restraints, historically ties to gold, no longer exist the only limit on creating money out of nothing is the stupidity of the public. How much debt can you get poor dumb suckers to accept before they rebel? Bitcoins are not created out of nothing. The mining process validates the public ledger, the Blockchain, and insures that nobody is counterfeiting coins or double spending. Mined coins are a reward for valuable network services. Additionally, there is no central creation authority. Competing miners create Bitcoins all over the world. This system is not without fault and Bitcoin variants are exploring technical improvements but the Bitcoin creation process is essentially a mathematically secured network phenomenon and it is much harder to corrupt than bribing a few central bankers.
  4. Why do authorities maintain the right to confiscate private funds? A Bitcoin feature that is particularly disturbing to authorities is that it’s not difficult to prevent even powerful entities from seizing coins. A coin cannot be moved or spent unless you get its private key. If you do not know the private key a Bitcoin will just sit in the Blockchain taunting goons that covet it. In a Bitcoin economy it will be difficult to garnish wages, block money transfers and seize assets. How will the state survive?
  5. Why must fees be levied when moving money across national borders? The public has never accepted this little rape. How many of us have lied to custom officials when asked about how much cash we’re carrying?  I’m guessing a fair fraction of all travelers. We all know it’s none of their damn business but being good little cogs we bend over and submit to state sodomy. Bitcoin penetrates borders with the same ease that custom authorities conduct cavity searches. Go ahead cut off coin movement! All you have to do is turn off the Internet, commander all USB ports, block old fashioned paper mail and learn how to read people’s minds. Any information storage and transmission device, including the human brain, can be used to move coins. Go fuck yourself customs. One day money will be free to move without your permission or consent!

Obviously we cannot have too many people asking such questions. Mathematically sound, open source, publicly validated and distributed real money like Bitcoin must be ridiculed, harassed and stopped. Left unchecked it will cauterize an important component of state power: arbitrary money creation rights.  By providing an elegant mathematical model of how a world without central banking and national currencies might function Bitcoin is a perfect protest: a good idea that our corrupt “leaders” cannot honestly answer.

Tipping with Bitcoins

For the last two days my elderly laptop has struggled with the bitcoin-qt client while it downloaded and checked the entire Bitcoin block chain. This is one of the fascinating things about this “currency.” Its entire global transaction history is public. It occurred to me that the Bitcoin economy is now large enough to verify basic macro economic equations. You can precisely calculate the “velocity of money” from Bitcoin blocks.

Now that I have synchronized with the Bitcoin network all I need is some coin to play with. If you would like to send me a few micro Bitcoins I will send them right back. I want to observe the transfer process. Please use this address as a tip jar:

17MfYvFqSyeZcy7nKMbFrStFmmvaJ143fA.

17MfYvFqSyeZcy7nKMbFrStFmmvaJ143fA