One of the most exciting things about bitcoin is the innovation it has sparked in trustless p2p applications. Currencies are just the beginning.
A timestamping/notary is one use. Namecoin (mutable key/value store), Bitmessage (transient messaging) are others.
I expect we'll see a lot more. It's interesting to think about how you could combine various properties of different p2p systems like Bitcoin, BitTorrent, etc.
The one disadvantage of such P2P networks is if law enforcement ever cracks down on it.
Not saying they necessarily will, but if the US outlaws Bitcoin at any point, then it will be extremely easy for them (or anyone; hypothetical anti-Bitcoin couch-vigilantes perhaps) to see the IP addresses of American users of the network, and then serve warrants and take action against them.
Same if Tor ever gets outlawed; Tor relays in the US can be identified and taken down with ease.
I don't see these systems themselves being outlawed in the US and it will be a dark day if they are. I'm not a lawyer, but I imagine their use falls under the 1st Amendment. Even if they're used for illegal purposes they're not inherently illegal.
Also it would be rather ironic for the US gov to outlaw Tor, given that they help fund it's development.
As long as Tor or similar systems are available other p2p networks can be used over it (you could even imagine networks that operate as hidden services)
Is what you are discussing not simply a disadvantage of networks though? While it would be possible to whack-a-mole P2P users, it's still a lot more work than taking down a centralised system.
So far the centralised bits of the bitcoin ecosystem (in particular the exchanges) look a lot more fragile than the network itself.
Also, if they want to play bitcoin whack-a-mole, I think they have to outlaw tor as well ;)
Part of the disadvantage is that any user of a P2P network can instantly join the network, and then immediately "rat out" any other peer he comes across.
If a network is totally closed off, with a single point of entry, one would first have to take down or infiltrate that single point. For example, if a hypothetical illicit VPN was created, hosted by a large server in Serbia, criminals in the US could tunnel their traffic through chains of proxies, with this VPN server at the end of the chain. US law enforcement would have quite a bit of trouble seeing the internals of this network, at least without significant social engineering and investigation.
If a network is freely joinable and is a "panopticon" (everyone can see everyone else), investigation into the network can be done by anyone anywhere, with ease. What IP addresses are connected, how much data and what kind of data nodes are sending, etc.
In general I agree though. The Bitcoin network and protocol is strong and well-designed, and assuming major governments do not ever outlaw the use of the Bitcoin protocol itself (and they probably won't), it should remain strong for a long time. Bitcoin exchanges are definitely the weakest link.
Comments
One of the most exciting things about bitcoin is the innovation it has sparked in trustless p2p applications. Currencies are just the beginning.
A timestamping/notary is one use. Namecoin (mutable key/value store), Bitmessage (transient messaging) are others.
I expect we'll see a lot more. It's interesting to think about how you could combine various properties of different p2p systems like Bitcoin, BitTorrent, etc.
The one disadvantage of such P2P networks is if law enforcement ever cracks down on it.
Not saying they necessarily will, but if the US outlaws Bitcoin at any point, then it will be extremely easy for them (or anyone; hypothetical anti-Bitcoin couch-vigilantes perhaps) to see the IP addresses of American users of the network, and then serve warrants and take action against them.
Same if Tor ever gets outlawed; Tor relays in the US can be identified and taken down with ease.
I don't see these systems themselves being outlawed in the US and it will be a dark day if they are. I'm not a lawyer, but I imagine their use falls under the 1st Amendment. Even if they're used for illegal purposes they're not inherently illegal.
Also it would be rather ironic for the US gov to outlaw Tor, given that they help fund it's development.
As long as Tor or similar systems are available other p2p networks can be used over it (you could even imagine networks that operate as hidden services)
Interesting talk on how governments have tried to shut down Tor: http://www.youtube.com/watch?v=DX46Qv_b7F4
I agree, it's highly unlikely it could or would be outlawed. Was just thinking hypothetically.
Is what you are discussing not simply a disadvantage of networks though? While it would be possible to whack-a-mole P2P users, it's still a lot more work than taking down a centralised system.
So far the centralised bits of the bitcoin ecosystem (in particular the exchanges) look a lot more fragile than the network itself.
Also, if they want to play bitcoin whack-a-mole, I think they have to outlaw tor as well ;)
Part of the disadvantage is that any user of a P2P network can instantly join the network, and then immediately "rat out" any other peer he comes across.
If a network is totally closed off, with a single point of entry, one would first have to take down or infiltrate that single point. For example, if a hypothetical illicit VPN was created, hosted by a large server in Serbia, criminals in the US could tunnel their traffic through chains of proxies, with this VPN server at the end of the chain. US law enforcement would have quite a bit of trouble seeing the internals of this network, at least without significant social engineering and investigation.
If a network is freely joinable and is a "panopticon" (everyone can see everyone else), investigation into the network can be done by anyone anywhere, with ease. What IP addresses are connected, how much data and what kind of data nodes are sending, etc.
In general I agree though. The Bitcoin network and protocol is strong and well-designed, and assuming major governments do not ever outlaw the use of the Bitcoin protocol itself (and they probably won't), it should remain strong for a long time. Bitcoin exchanges are definitely the weakest link.