Bitcoin Suggestion

[dveb8886]

Hello guys, I was listening to a debate Stephan was having with Peter Schiff about bitcoins as linked here: 

 

http://www.youtube.com/watch?v=mFcTJAQ7zc4&feature=c4-overview&list=UUC3L8QaxqEGUiBC252GHy3w

 

One of the concerns that Peter mentioned was how bit coins require technology in order to use them, as opposed to cash, which you can just transfer from one person to another easily. His concern was this technology involving the internet, so every transaction can be monitored by an outside agency once somebody figures out how to do that. 

 

Peter later noted that people might be able to carry their bitcoins in their flash drives, and transfer them that way, but I thought of something that might appeal even more so as it eliminates the need to find a computer to execute the transfer if you use the flash drive approach : Our smartphones.

 

What if somebody created an app where phones connected to other phones that are nearby (using bluetooth or something), and the app would connect to an instance of the same app on the other phone, and then the transfer can be executed with just a few simple finger swipes. This would make the transfer process much easier as a whole, and I think it resolves that concern that Peter had about bitcoins being more difficult to transfer than cash (for black market actors)

 

What do you guys think?

[powersquash]

Smart phones are currently the most sought after in terms of hacking. When the newest iPhone was released a website was paying $10k and other bonuses for the person who figured out how to successfully hack through the finger print scanner. Until security on cellular devices increase I don't see this being a huge plus.

[Kevin Beal]

Smart phones are currently the most sought after in terms of hacking. When the newest iPhone was released a website was paying $10k and other bonuses for the person who figured out how to successfully hack through the finger print scanner. Until security on cellular devices increase I don't see this being a huge plus.

I'd like to see this ad.

 

I'm not an expert, but here's my understanding of security:

 

Security is almost always an afterthought, a patch on top of a prototype. It gets increasingly more sophisticated, but it's still not very secure. The solution is just to find out how people hacked it and then do an update with that security hole patched up. You even see this with flash games like Gemcraft (for example).

 

The actual way that security professionals program applications is to build the security right into the architecture of the program. Not like passwords and locks at each entry point (that would actually be a bad idea as it turns out), but an architecture that provides information on a strict need to know basis to each of it's component parts in a modularized pattern. It means that if you do end up getting access to one of those components you aren't going to get anything interesting and getting access to the next component becomes increasingly difficult.

 

If you get access to the component that communicates with the server, but not the component that generates meaningful requests to that server through that component, and not have access to the encrypted keys either, you just aren't going to get anywhere.

 

I don't know C++ and haven't looked at the open source code for bitcoin, but it's my understanding that it was built from the ground up with security as one of it's main features.

 

The fact that it's open source, but we can't counterfeit coins or steal from people's bitcoin wallets is a testament to this fact. Any hacker that wanted to could look at all of the code and still find nothing meaningful in his search to steal from people.

 

This is a really profound thing if you think about it.

 

People have this idea about hackers like they are looking at ones and zeros and making magical programs to affect those ones and zeros in any way that they wish, but as I understand it, hackers just capitalize on the mistakes of bad programming (and there's a lot of it).

 

This Google tech talk about secure programming is actually really good, although the speaker is slightly abrasive, and it might not make a whole lot of sense to non-programmers:

[Wesley]

Ways to hold and transfer coins:

 

1. Send them before you leave. The idea that you need to transfer coins by carrying them anywhere was silly and showed that Peter Schiff had no idea how bitcoins worked. You can send the coins to a cold wallet or another wallet or import your private key into a computer that is overseas, or just take you computer or many other things. There is 0 need to take anything physical with you when transferring bitcoin overseas. Thus, there is no need to declare that you are carrying bitcoin overseas.

 

2. Paper Wallets. Put any amount on the wallet and then hand the piece of paper to someone.

https://en.bitcoin.it/wiki/Paper_wallet

https://bitcoinpaperwallet.com/

https://www.bitaddress.org/bitaddress.org-v2.6.2-SHA1-4d98755d7e78caa4361228a2b11b0faa0f65e6de.html

 

3. Use Cassius coins. (same idea as the paper wallet, but they are coins)

https://en.bitcoin.it/wiki/Casascius_physical_bitcoins

https://www.casascius.com/

 

4. As with the smart phone app with bitcoins, that already exists. However, iPhone is notorious for kicking wallets off of their app store. However, if you jailbreak your phone then you can get an app or you can use a browser app as a wallet. Android, just go to the app store and download it. I would advise against storing large sums using these methods. Only carry around spending change that wouldn't be terrible if you lost.

 

5. Make your own cold storage-type thing in the path of Cassius Coins or paper wallets.

 

6. I am sure there are many others.

 

The problem with a local transaction is that it cannot be verified by the network. The receiver is then taking a massive risk that they actually received the coins and that they are not an attempted hack. Once the transaction is broadcast is verified or rejected by the network, you know whether to accept the coins or not.

 

Thus, transactions do need the network, however using one of the paper wallets or coins has ways for you to check the balance of the wallet in a secure way where it is apparent that the wallet hasn't been compromised through physical means. You can then hand the hidden private keys to someone else and thus there is no need to broadcast the transaction.

[powersquash]

http://istouchidhackedyet.com/

 

That's the website kevin. Plenty of news coverage surrounding the event if you go to Google ^^