What kind of repercussion will this have in the future, say, when Bitcoin will be more widely utilized? It seems to me that it might only cause an issue to Bitcoin's market during these initial stages, where a rich bitcoin owner could fluster the market by selling large amounts. But in the long run, there will always be the rich and the poor. Or is there something I'm missing?
And better yet, everyone could just switch to a client that works exactly like the clients we use to day except that it allows a new wallet I just created containing 100,000 bitcoins. This one is better because I get rich.
And to make it work the only thing I need to do is convince everyone to use it. It's kind of like that guy who convinced everyone to allow little green slips of paper to be traded for goods and services -- ALL money has value only because society consents to value it, and society could change it's mind. We've done so before -- consider when the Euro was created and how after a transition period the currencies it replaced became worthless (except as collector's items).
The hard part is convincing everyone to use YOUR plan. The deftness with which Bitcoin has navigated that social dilemma is one of the most impressive things about it. Somehow we have all come to agree that certain bit patterns and secret keys are worth valuable goods and services.
That is a very interesting idea, it makes the fungibility of BTC seem highly questionable, if you can look at its history forever and do an arbitrary 'blacklist'.
That would seriously diminish confidence in bitcoin, though it might encourage spending of bitcoins. I suspect the latter will not be enough to overcome the former. The end result would likely be bogus transactions between addresses merely to keep the money "alive". Adding 0 value and potentially negative value as now a set of useless transactions will sit in the ever growing blockchain.
Similarly, during the transition of clients accepting to clients not accepting those coins, what happens if there's a transaction from one of them? What if it's only partial, they spent 2k but left 2k, they're active but now out 2k BTC that they can't spend?
This is sort of like discussing blacklisting "stolen" BTC. Suppose I figure out 100 brainwallets and steal 1000 BTC. Before I get added to the blacklist, I transfer 1 BTC to each of 1000 addresses. Do you blacklist the whole chain of addresses going back? Do you only blacklist that one amount (essentially reducing the value of those addresses by 1 BTC each)? What if one of those addresses is yours and I'm just tainting every address I can find. You'll have 1BTC that you can't spend, and you don't know to whom it belongs. Which of the original 100 addresses do you send it back to if that's the intent of the system? Do you send it back to a known hacked address? Does the former owner have a mechanism to announce a valid new address for kindhearted souls to return their bitcoins to?
