With so much talk of bad actors and people claiming that certain ones are trying to destroy coins like bitcoin, I thought I might talk about the likely ways governments would attack if they chose to do so. These are my opinions but I also think that one of the three ways im going to talk about are ultimately the way a government would approach just because of resource limits, ect. Each offers a level of efficiency, but there are drawbacks to each method as well. I write this as a way to highlight why decentralization is important in making sure none of these attacks could take place.
The first one is perhaps the most simple, but possibly the most devastating if carried out, which is an attack that exploits a bug in the code. Essentially it would consist of government programmers scouring the bitcoin code or a mixture of another method I will talk about later and inserting a bug into the code via infiltration and exploiting it. Most likely the exploitation would be used over a long period of time to achieve a specific goal without many noticing what is going on. However there are many drawbacks with this method. First of all you would have to hope the bug available, which might not even exist, would be exploitable to your benefit (allowing movement of coins, exposing someone’s privacy, ect), which itself is unlikely. In addition you have to hope that no one actually notices what you are doing any make sure you can be as disruptive as possible over a long period of time. If you do a quick attack, you risk the chain being hardforked and rolled back which means your work meant nothing.
The second and perhaps most likely attack if governments decided to go after bitcoin would be an endpoint attack, or basically go after the exit points in the economy. Most likely since most of the endpoints deal with bitcoin, they would go after exchanges that pull out or accept withdrawals. They would either use a denial of service attack to bring the websites offline continuously, or more than likely bring them down via the hosting service. Many would be back online, but if you cut off any transfers to banks, you would hurt the investment greatly. Even just saying they plan on doing it, would make many weary people try and cause a stampede out the door. This is why we need localbitcoins and better decentralized exchanges. Some countries have already cut off access to exchanges and more could attempt to do this.
The third and final way an attack would likely take place is through infiltration. There are many organizations where you could infiltrate. Infiltrating developers might work, but there are many idealists in the space who would call you out and the chances of your bip being implemented without people scanning over it for any little bit of hint that you are trying something, isn’t likely. The most effective method would probably be infiltrating the companies around the space that support the network, miners specifically who could purposefully slow down the network. You could also DDOS the blockchain with many small spam transactions which has been an effective strategy. Also manipulating community thought through upvotes and specifically placed individuals is a possibility. Overall infiltration is probably the largest area of possibilities and probably a thought that has already crossed many government’s minds. We saw it happen in the silk road bust, so we know the government isn’t above that.
I think the three methods I covered are the most likely avenues of attack, not just for governments, but for any bad actor to try and take over various protocols. It would most likely not kill any of the coins, but it could hurt them for a long time/indefinitely. You could shrink a coin’s user base with one of these attacks. Again I tell you this because you should know what to look for and question people who seem like they are doing shady things.
Good points When you can print all the money you want to print it sort of give them an advantage. I say they are done in my lifetime. The war monging psychopaths will be history!
Hmm... I'm not so sure. If they wanted to manipulate the Bitcoin economy all they'd have to do would be to buy as much of it with their absurd wealth. Which they may do at some point if/when they have no other means to shut it down.
I see your point They would try to break it first before they tried to just buy their way in to control the market. Well I have been smelling a rat for some time with Bitcoin. Meaning that it may just be another government BS scam. Not much comes from the people. These psycos are way ahead of regular people.
"Essentially it would consist of government programmers scouring the bitcoin code or a mixture of another method I will talk about later and inserting a bug into the code via infiltration and exploiting it. Most likely the exploitation would be used over a long period of time to achieve a specific goal without many noticing what is going on."
Otherwise known as Segregated Witness. Or SegWit2x.
I would also call regulation-strangulation their 4th option.
Not enough understand your very valid concerns
Dave
Exactly this!
I doubt if a certain progressive government will do it... as other first world countries are already into cryptocurrency. A country should adapt or be left out in the competition....
I dig your comment sir.....well said!
So here's the "thing" about crypto. Its a global currency and no one country really owns it. This is extremely important since this makes it neutral in a way. Some countries are taking a very friendly approach to crypto, legalizing it and treating it like any other currency, like Japan and from what I read India is about to do the same. At this point, I believe there is enough support and understanding of crypto that governments will not act hostile towards it. Most people are beginning to find it fascinating like the early days of the Internet.
This is all true in our reality currently. I think it may be too far decentralized right now for any one government to put a halt to the system. If anything there is a very serious threat right now within. In my opinion a contentious hard fork creating two Bitcoins could be the most damaging thing and the government doesn't even have to be involved. I do believe though if it were to happen LTC & DASH would benefit heavily and will get a chance to take the limelight. Ethereum is having their own concerns as well with Casper and the miners maybe not being too fond of Proof of Stake. I guess we will all see.
I could not agree more. Two Bitcoins would def not be a good thing for Bitcoin since its whole deal from day one was cash and store of value. I am sure if SN could do it over again he'd have put in a governance type of DAO. At very least proof of shares protocol built in but 09'-10 Bitcoin was only a baby and it was already big experiment to prove in itself. Will see what happens but I am leaning towards seeing two Bitcoins come Aug. 1st. It still does not mean I would not hold any but I have more and more into Dash as I see it surpassing BTC anyhow down the road.
Much like grow ops, I see them looking at the miners. Those are the low hanging fruit. Monitor power consumption. If it's high, get a warrant then find out if its drugs or miners.
Since miners aren't illegal, they would then have to monitor the bank accounts of the individuals. (Similar to watching endpoints)
I hope this never happens, but I see it as the easiest way to spot something. POS will reduce this risk.
Governments control everything, they know everything about you. There's no way to escape them, they own you!
Haha....no one owns me. I choose what I want voluntarily. If something happens outside of my control, then so be it. I'll deal with the situation when it appears. I choose and will continue to choose freedom without fear.
Bitcoin is unstoppable, governments can just slow down of what is going to happen. Quantum computers are a thread though.
As long as they can find a way to tax it then it will be safe if not it will not be around to long. Like online gambling sites the USA made it almost impossible to put money in or take money out a few found ways around it,others quit some like myself discovered bitcoin sites. Time will tell whether we're just at the beginning of this revolution or at the end. Don't forget the saying don't put all your eggs in one basket.
I always worry some stupid law will be passed that will end cyprtocurrency! But I hope that day never comes! Fingers crossed!
Laws are manmade and therefore not necessarily just. I imagine there are laws that we all are offenders of...but it doesn't stop us from doing what we want. A 'stupid law' is only as effective as you allow it...because if you can memorize your private key(s), then they would have to torture you to make you tell them (for some this may not be effective). Also, if we are connecting on a decentralized private platform then they aren't privy to that activity. Although this is not true amongst all crypto-currencies.
Monero would be really useful wouldnt it?
Yeah...if you use it correctly and keep your view-key private as well.
do you think tor or vpn is necessary if it does become illegal?
The government is always after money 💰, or people who make money
good
This is why Proof of Stake is the way foward
Yes, I'm always a little wary when the big guys like the government, have their hands or interest on something.
Bitcoin is already infiltrated according to We Are Change. However, it is not enough to destroy bitcoin because if it does fall…other cryptocurrencies such as Ethereum, Monero, Zcash & more will take its place.
It wasn't Luke with We Are Change....I believe you may be referring to the interview that Amanda B. Johnson had with AMTV. Personally, the host hypes things even more than Alex Jones.....I'm not a fan of hyperbole.
We will have to evolve as these threats progress. The threats will not stop and will possibly never let up. Things like STEEM give power to our community because it allows us to share information. It's time to make them afraid of what the people can do. Thanks for the info.
Taxes will be another way to go after crypto and discourage people.
A new bunch of European directive about crypto is coming in 2017 and in some country, there are already crazy taxes when you want to cashout your profit.
Or they can go crazy like in Venezuela, forbid bitcoin and throw miner into jail.
For me the way they could try and bring it down is to make it a lot harder to get to, and trying to prove that bitcoing is mostly used for criminal and terrorist transfers and such, wich was the original stand they had when it became a thing. Financing terrorism and criminal activity annonimously is a big downside that can be pushed and used for putting people off of the crypto world.
I think they are already pushing this narrative and even ramping up the rhetoric around this concept. While this is technically true...you can not damn a whole community when only a certain percentage is participating in that sector.
Exactly but they can make it harder for the rest of the people to use it so that small percentage stays on display. We all know how media works and how much people like to believe it.. it needs a really small push which is quite sad.
Attack by bugs in the code requires evil coders hunting a coin's code for weak spots. To me that does not sound much different than ordinary hackers trying to game the system. It seems unlikely that government would attract brilliant hackers to try to find bugs in a cryptocurrency coin's code. Even if they find one, software can be changed quickly so damage to the reputation of cryptocurrencies, if any, would only be temporary.
The connection points between digital currencies and fiat (meaning: current money) systems are weak spots. But the importance of exchanges may diminish over time once cryptocurrencies spread over communities, entire countries, the entire world. In principle, exchange can be done directly without the need of an exchange. However, some form of exchange is still needed for price signals. Should government attack exchanges instead of regulating them, I foresee the rise of decentralised exchanges like Bisq. In fact, Bisq may be the next-gen exchange once fiat money no longer plays a major role in economies.
For infiltration a similar thought applies as stated under 1. Yes, it could do damage and yes, it may give governments an angle if they want to cause harm. No, it won't stop cryptocurrencies from advancing. Set backs would only be temporary. The strong points of (open source) software are that it can be copied endlessly, reused and changed by anyone. Whacking a mole will not destroy all other moles popping up.
I miss the biggest 'threat': taxation. Governments will probably tax cryptocurrencies in forms that are not always the best in terms of economic effects. With governments up to their eyeballs in debt, there may be an incentive to impose crushing taxes on cryptocurrency gains or capital gains taxes levied from exchanges directly. Such move would severely delay the rise of cryptocurrencies. But it would not stop the advance, only temporarily slow it. Cryptocurrencies would go underground on a 'dark net' and if that happens in large enough numbers, governments will have lost total control, forever.
So in my opinion,, government's best approach would be to adapt to this new tech and find a place in a new equilibrium between citizens and State. Attacking it too hard and this tech will go underground.
Brilliant additions, thank you!
However, if governments did attack the end points in say the US or UK there would still be some countries that would allow bitcoin to be exchanged for local currency because of the potential billions of $ in trades it would inject into their economy. It would be such an advantage to a smaller nation, like say Japan for a large country to this. Thus ensuring a way out of crypto albeit probablly at a loss
Or they can just shut down the internet.
Could China infiltrate bitcoin by influencing the miners that are situated in China?
I wrote an article on this. My research on China is on the comment
https://steemit.com/bitcoin/@rjona1/can-bitcoin-be-co-opted
Never underestimate the greed and power lust of governments...
They will and have to fight the coins, because they cannot control them. But they can stop them.
The weak spot is what you listed as #2, the transfer between the web and real world economy. And they dont need any clever hacking or so, they simply declare it illegal to exchange coins into FIAT money or vice versa, or to accept coins in a purchase. Sure, you then can still send your coins around on the web, but you cannot buy anything for them - which renders them worthless.
The government want to instill fear in the population so they can keep people enslaved on the fiat dollar. Keep us in debt keeps us under they're control so they can profit, sad.
See, I'm thinking that they would just report little used or perhaps straight up imaginary exchanges failing!
Actually, all they will do is outlaw it and be done, I suspect. Call it a "tool for money laundering, drug dealers, and terrorists."
The governments have a far more easy, and tried and true method of attacking crypto. Fear. Fear through misinformation, by working in unison with the media and the finance industry (who are driving the policies on this) and then fear of prosecution fines and jail time.
If another nation should wholeheartedly embrace the said taboo or even offer a safe haven for others, they will also be punished with fear, the fear of sanctions and then the fear of war (terrorism).
None of this is to say, that governments are not already doing any of the things you have suggested.
What an excellent steem post man! you obviously, have the right ideas, I think there's no reason to worry because the social support for blockchains will out perform and out number any one government! It would take every government from all countries working together to stop or control bitcoin...lol when was the last time all governments were in agreement on anything ..lol thus we have nothing to worry about! -Great job #calaber24p
good article.. thanks
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Your post basically says they could attack it at it's front, middle or back.
We had come up with 10 ways in this post about two weeks ago that goes into a bit more detail specifically about what central banks could do.
https://steemit.com/cryptocurrencies/@thehutchreport/10-ways-governments-could-stop-cryptocurrencies
Regulation, exchange rate manipulation, media smear campaigns, etc.
It'll be like it's always been. They'll thell the people cryptocurrencies are bad for economy. Then, they'll invest in cryptocurrencies. When the party is over they'll say it's okay.
Either that or we make them fall.
Greetings from Argentina.
NIce but you forgot the 51% attack that is viable on PoW/PoS and the N@S on PoS.
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I think a way for them to stop it is to completely tarnish the image of cryptos to the point where they couldn't enter the mainstream (due to the usage by criminals, ransomware etc, scaring the public) and this worries me.
good article! upvoted
You missed the most obvious which is also the most likely.
They will start to tax transactions. Corrupt the system by skimming a bit off the top.
Almost certain to happen. And a sign that cryptos will have a long life once governments start realizing the benefits of skimming
STEEM On !!
Dave
tax transactions?ouch
With the budget deficit in US, I predict that this is inevitable.
Government won't be able to keep their grubby hands out of the money flow
I like your post.
The first method that you were talking about reminds me of the core v. unlimited war. I mean debate