Ray Dillinger on the Sad State of Blockchain

From Ray Dillinger, who reviewed the blockchain code for the orginal bitcoin source code and began experimenting with virtual currency back in 1995, comes a regretfully toned message on the current state of affairs:

Sadly, many of the people who launched these alternates don’t know what they’re doing. Even more sadly, most of them do know what they’re doing, and at least three quarters know that what they’re doing is ripping people off. They strive to do it as well as they possibly can, usually by means that I can’t really distinguish from blatant stock price manipulation and insider trading.

His lament comes after praise of bitcoin and Satoshi:

Every Trusted role is, by definition, a weakness in security. You can see why security professionals are aghast when people talk about “Trusted Computing Modules” becoming a standard part of computers.

Satoshi had developed, as far as I’m aware, the first digital cash system with no Trusted role at all and thus, no way to abuse a Trusted position.

You know the old saw about being able to get a lot done if you don’t care who gets the credit? Satoshi doesn’t want the credit. Two years later he walked away and left the pseudonym behind. And hard as this may be to believe, it looks like he doesn’t even want to be paid for it. As far as we can tell he mined approximately a million Bitcoins and has never sold a single one of them.

The original selflessness of bitcoin feels a long way from the ICO-craze.

I hate to even imagine how many billions of dollars of scams and failures and thefts have been perpetrated by abusing people’s faith in and enthusiasm for that technology by now. And I have no idea how we could possibly have prevented it.

$280 million in ether gone forever?

From Code mistake freezes up to $280 million in digital currency at Engadget:

Observers estimate that there could be more than 1 million in ether locked away, which would amount to roughly $280 million.

The digital wallet company Parity is warning users that a large volume of Ethereum funds have effectively been frozen after code contributor devops199 claims to have accidentally deleted the library needed to use multi-signature wallets (those that require more than one signature to move funds) created after July 20th.

This doesn’t mean that the currency is permanently off-limits, but unfreezing it and compensating users could involve a bailout. And whatever happens, the incident highlights a simple problem: digital wallets and cryptocurrency in general are only as reliable as the code that guides them.