Last updated on July 27th, 2013 at 03:29 pm
Keep the anonymity and freedom. This is the main goal of two anonymous activists that have proposed an alternative to Bitcoin: an option that would fork the protocol and generate Bitcoin 2.
This new derivative of the original code would help maintain what the proponents call, in their paper “Bitcoin 2: Freedom of Transaction”, the “original long-term vision” of this cryptocurrency, destroying the elements of the protocol that they consider to be damaging to the system.
Bitcoin 2 would be built to support the anonymity protocol Zerocoin. This is the activists’ plan to stop the original protocol from developing “into a system that is a complete perversion of the original vision – a completely transparent payment system with very few points of control which has been totally absorbed by the established financial and regulatory environment”.
This is their vision, but what would the experts say? Core developer Jeff Garzik says “it’s another Altcoin. They are attempting to ride the coattails of the Bitcoin brand, but other than that, experimentation is a good thing. The marketing of most Altcoins is inevitably Bitcoin-critical, as they want to distinguish themselves from the main competitor”.
Besides fighting for Bitcoin’s anonymity and freedom, the paper also hopes to harvest the users of cryptocurrency. “We do not lobby for making our proposals part of the current Bitcoin system, but will do a hard fork. Whoever wants to stay in the old system, can. Whoever wants to switch can as well. And we think this can be done without the problem of a hard asset reset which limits competition to Bitcoin (as in, starting from scratch in mining, market, etc.)”, explained Eric Gonzalez, one of the proponents.
According to the paper, the authors are specifically concerned with the new features of the Bitcoin v0.9 release, which brings the Bitcoin Payment Messages system that allows merchants to connect with the customers. Payments would be completed using digital certificates owned by the merchants and would contain information about each transaction.
The authors are also worried about the possibility of tracing the route of every Bitcoins spent by a user. As stated in the paper, “software to analyze financial flows for money laundering patterns in the traditional banking system is widely available and it could be adapted to Bitcoin easily, which would make it harder to conceal ones identity”. Gonzalez claims that this “is one of the concerning developments, not too dangerous in itself, but problematic in combination with other changes”.
However, Jeff Garzick claims that these features are unnecessary and probably are going to retard the progress of Bitcoin: “a corporation that wishes for its finances to be auditable by the world at large will not want these proposed anonymity features. Wouldn’t it be wonderful if major corporations or governments published completely open, transparent, auditable, cryptographically proven accounting? Bitcoin technology enables that”.
Another thing that the paper wants to introduce is a regular-sized block chain, since the one we have now is always increasing. According to the paper, the increasing block chain increases the idea of centralization, still making full clients less feasible over time. “We might sound rather pessimistic to you, but we have been in the digital currency industry for almost two decades now”, says Gonzalez, adding that “things usually go ways you didn’t plan for, simply because you did not have the power necessary to defend yourself against regulatory pressure”.