It would be easier (for me at least, but I suspect others as well) to take Bitcoins seriously if the backbone of the Bitcoin economy weren't the Magic The Gathering Online Exchange, which apparently is crippled by loads of less than 40 transactions/sec.
It seems a bit fallacious to equate a Dollars-to-Bitcoins exchange with the Bitcoin currency itself. I know it's easy to forget amid this speculative frenzy, but conversion into USD is not really Bitcoin's ultimate purpose. None of these attacks have had any effect on transactions within the Bitcoin network/economy itself.
No, actually, it isn't. You're quoting a piece of marketing material for chrissake. They handle 80% of all Bitcoin TRADE. As in Bitcoin-to-USD-and-vice-versa trades. Not Bitcoin-to-Bitcoin transactions.
You clearly don't have even a basic understanding of how Bitcoin itself works. It's a distributed, peer-to-peer system. That statement is analogous to saying "The Pirate Bay handles over 80% of all Bittorrent traffic." In reality, TPB handles exactly zero actual torrent traffic, and Gox is in no way involved in processing actual bitcoin blockchain transactions.
Like TBP, Gox is a convenient target for people trying to disrupt easy entry into the more robust distributed system that it provides access to. But if you already have bitcoins and simply wish to spend them, Gox could get sucked into a blackhole and it wouldn't affect you any more than a raid on TBP affects your in-progress torrent downloads.
Is there a limit on the depth of comments here? I can't seem to reply to cjh_'s adjacent post. Anyway, he's correct that it's possible to keep all your coins on a Gox-hosted wallet. I kind of forgot that people actually do that. It's a really terrible way to store your coins, even if you use a more stable/trustworthy service than theirs.
There are much better ways to utilize the convenience of a web wallet without handing all your coins over to some sketchy website, such as blockchain.info's wallet system.
Yes and No.
You are right in that Mt.Gox doesn't handle 80% of all btc-btc trade.
However many use Mt.Gox as their wallet so the TPB analogy doesn't quite hold that far, as Mt.Gox being taken down would mean these people wouldn't have access to their BTC funds stored in that wallet.
I should have mentioned this in my original post, but I was sloppy.
Transactions only cause lag on their trading engine. They are not the reason their whole website and online presence disappear!
When MtGox denies service, like today, this is because of a DDoS. They have said multiple times that they see 10+ Gbps (SYN flood and UDP packets) hitting their servers on a weekly basis!
Well, that's coming. Give it a few months. There seem to be a number of projects in this space, but I guess it won't be legit for some people until an LMAX Disruptor is written to do BTC FOREX trading.
The recent repeated abuse of the term DDoS by ignorant members of the bitcoin community is misleading and confusing.
The first D in DDoS mean "distributed". There has never been any evidence of a distributed attack.
Server overload from heavy use of an application is not a DoS attack. A 37 transaction per second capacity suggests that MtGox simply cannot handle even moderate trading activity.
The frequent small trades that the exchange sometimes sees can reasonably be explained by bots trying to exploit the market in some way and not to attack availability of the exchange itself.
At least some of these incidents appear to be actual DDoS attacks. It's true that Gox's trading engine sucks and is prone to lag during sudden spikes in activity, but many of these incidents have shut the whole service down very abruptly without any preceding increase in trading volume. Not to mention that they've released at least one Prolexic support ticket:
Most people don't know what a DoS or DDoS is outside technical circles; and it's become a bit of a joke in the Bitcoin community that every problem anyone encounters with MtGox or pretty much anything else can be attributed to a DDoS attack.
Re: Gox's transaction volume capacity, the market is begging for someone to come along and solve these problems.
It is clear you are following the situation as closely as those "ignorant members of the bitcoin community"; as MtGox themselves are calling these DDoS attacks and have reasonable proof of such.
It is also true that Gox's matching engine is .. uhh.. not upto snuff, but your accusation that 'ignorant members of the bitcoin community' are just calling everything a DDoS is in itself, quite ignorant.
Not open source (at least, not yet, for the server-side).
The client side is on Github, but has absolutely no tests. Literally, the stub files for the tests are there, but that's it.
Node.JS dev community really needs to get religion with testing.
But lastly, it's also somewhat centralized. While you can run a Ripple daemon locally, the actual currency's distribution is centralized. Which I think is... not smart.
Thanks for the link. What I couldn't find out while reading the site: Since it is a decentralized network, who runs the nodes, what's the incentive for doing so? I suppose running a node will give you their ripple currency, but this information seems to be not visible on their site. Apart from that, it looks like a really interesting project.
That is an interesting project indeed but I think the actual solution will not require previous trust among exchangers, because it would render it useless for the majority of potential users in my opinion.
There has to be something like an escrow service connected to it though (centralized or distributed) in order to guarantee for the transaction to be completed, do you agree?
I edited the original post, what I was referring to was a P2P bitcoin exchange, impossible to DDoS, and possibly built upon the technology shown by the bitcoin project itself
A solution exactly like what you've just described is in the works. Zyocoin is a P2P Bitcoin exchange utilizing multi-signature issued "debt", where debt can be BTC, USD, EUR, or bananas.
Real contracts are created with verifiable blockchain-based timestamping.
Debt is issued with colored coins.
Ripple attempts to do something like this but I feel it must be done natively on the blockchain to see widespread acceptance.
Python programmers wanted. Send a BitMessage to BM-oq7iLGGH7e7JJaqiTcUj1qGQYxeZVo65b; IM zyocoin@jabber.org or join #zyocoin on Freenode.
Are you using Entangled? I've looked at doing the same thing, also using colored coins. But it's going to take a lot of work + luck to go up against someone as well-monetized as Ripple.
Plus, the technical issues are not even the biggest challenge, it's forming and managing a clearing house in a decentralized manner. I'm not sure it's possible. But someone has to physically conduct the exchange of dollars, euros, or bananas. Otherwise, you've just developed a p2p version of localcoins.
I'm not usually a conspirator, but what if the US government or another government that didn't want something like bitcoin getting any bigger, was behind this? If this keeps happenings it will diminish the "brand" enough to always make people really cautious. Thoughts? Shooting from the hip here. :)
There are probably easier ways for the US gov to break bitcoin. A 51% attack on the bitcoin network (which requires a lot of computing power), would allow you to transfer all the bitcoins, would be much more crippling than "oh a website went down".
I have thought this as well. The fact that a bunch of exchanges all went down simulatenously and /r/bitcoin had a super-rare non-circle-jerky top-post (calling the bubble bursting), by a brand new member, gave me the impression that there was a coordinated attack going on. TBH, my first thoughts were more of a trading cartel trying to get in cheaper; but government was a possibility as well.
That being said,.. who knows? Certainly can't prove that's the case or even make a good argument for it (although, I do think a good argument could be made that something fishy was going on.
I think (2) is more likely at this point. There's only so much a market will take before it tanks and stays down for months. This kind of market (along with porn and gambling) is a great target for botnet controllers trying to make a buck.
Speculators. Slowing down exchanges drives the price of BTC down. So the plan is to start a massive DDoS, stop it, buy BTC at a lower price, and sell it again when the prices went back to their previous levels.
The original owner of mtgox had the domain name lying around. As far as I know, even the original mtgox bitcoin exchange shared no code with a card exchange.
Nobody's mentioned it, but their competitors would be the big obvious winners. I don't know if I think they are the likely culprits, but Mt Gox has a major network advantage right now over its competitors which is surely being drained by these attacks.
People here need to stuff it and read more before running on about Bitcoin - I've seen more biased, uninformed, telephone-word-of-mouth mutilated information, etc. And ironically, some are even running their mouths while accusing others of doing it. Mt.Gox has been being DDoSd , not just from transaction volume (due to their poor trading engine), transaction spam (a "fun" point of contention among people) and from other SYN/UDP flooding.
Everytime, until two days ago, each DDOS correlated in a massive drop off in price - including the air-releasing drop from 260 to 60 back to 120. Two days ago, the attacker lost money, and today, at least as of now and the price it was last night, the price seems to reflect the truth: sadly, mt.gox is a cornerstone right now (not for long) and mt.gox being DDOSd doesn't mean the immediate impending end of Bitcoin.
