[GNU/consensus] ZCash

[lupa]

Hi all,

Do you know this project? https://z.cash/

What do you think about it ?

thanks!
--
Lupa
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[IngeGNUe]

Post by lupa
Hi all,
Do you know this project? https://z.cash/
What do you think about it ?
thanks!

Really cool idea from a security perspective, I've been hoping to see
something like this. But, as others pointed out, it has potentially
undesirable political consequences. In my opinion, this is because it
treats every transaction as ethically neutral, even though it is
arguable that there are times when people deserve to know where money is
going, such as how large corporations spend their money.

But that's exactly what the CASH in ZCash is, isn't it? It's like
physical money (which, sans fingerprints, is just as untraceable) -- on
steroids, because you don't have to physically be in front of the person
to hand them anything. The cryptography replaces the physical world.

Let's address the potential for tax evasions and so on. There's no doubt
that something like ZCash would be in demand by humble individuals who
pay their taxes and only intend to (for example) securely donate to
people they've never met (software projects, indie music, indie media).
Shady corporations trying to evade taxes would also find it interesting
for other reasons. As a result, you get the wild west of currency, even
more so than bitcoin.

The question I have is how does one inject ethics without undermining
the security? How does one maintain that level of security without
undermining ethics? How does one have their cake and eat it? Because
that is the most interesting thing to me. Everything I had read over the
years with regard to security points at it being an all-or-nothing
principle: security for all, privacy for all. This being a good and
sometimes bad thing, depending on the circumstances and the people.
Nonetheless, if you undermine security for some, and you undermine it
for all.

Perhaps a solution would be found externally to the currency: for
example, to require certain organizations to practice transparency
(meaning they HAVE to provide view keys, or else they can't use ZCash if
they want to keep their doors open), but that doesn't stop them from --
just as it is with physical cash -- fudging the numbers a bit and using
ZCash to conceal a small percentage of transactions.

Devil's advocate: Even the extensive measures put in place to watch over
transactions in modern economies don't seem to have helped organizations
(especially large corporations) behave any better. It causes me to ask
whether something like ZCash would ultimately make any difference in
that area? Perhaps the bar would be lowered since (in the corporate
criminal mastermind's head) instead of offshore banking you have ZCash.
Which means that in order to sanction them, you would have to be a
little more creative, but it's probably doable. Bearing in mind that
physical cash has been around for centuries, and haven't we developed
systems to deal with that?...

It's worth noting that the other side of the 'coin' here, the side that
ZCash is on, is the ethical necessity of private transactions. There is
no doubt that sometimes people need that transaction privacy, for
ethically good, or simply personal, reasons.

It seems hard to imagine any currency that can evaluate the good from
the bad players, but it is getting late and I should get some shuteye.

Just my thoughts on that. Anyone else?

[IngeGNUe]

Post by IngeGNUe

Post by lupa
Hi all,
Do you know this project? https://z.cash/
What do you think about it ?
thanks!

Really cool idea from a security perspective, I've been hoping to see
something like this. ...

(snip)

One thing I would reflect on this, however, is that if ZCash is based on
bitcoin, then it still has all the drawbacks of bitcoin with regard to
mining/distribution of coins to its users (based on the principle of
processor might-makes-right with diminishing returns).

So could the privacy features of ZCash be ported to more fair currencies
such as faircoin 2.0? I will ask them.

[carlo von lynX]

Post by IngeGNUe
The question I have is how does one inject ethics without undermining
the security? How does one maintain that level of security without
undermining ethics? How does one have their cake and eat it? Because
that is the most interesting thing to me. Everything I had read over the
years with regard to security points at it being an all-or-nothing
principle: security for all, privacy for all. This being a good and
sometimes bad thing, depending on the circumstances and the people.
Nonetheless, if you undermine security for some, and you undermine it
for all.

Don't know if you've seen recent talks or interviews of Richard, but
GNU actually has a sensible answer to that question called TALER.
Check out https://taler.net.

It sounds pretty unspectacular if you first read it. Works with
existing banks. Works with existing currencies. Does not try to
revolutionize capitalism, just tries to stop the madness of paying
the Internet with your soul. Allows the buyer to remain anonymous
while the seller has to explain to authorities how they earned it.

The idea that the whole capitalist apparatus can be revolted by
technology is wrong as technology is heading into the same free-
from-ethics direction, and does so even more harshly than capitalism.
That's why speculators love to proclaim blockchain as the great new
thing. It's the great new tax haven. And the reason why hackers fall
for that is, maybe because they don't get it. So caught up in what
the technology could be, they don't see how much it isn't. It's so
very Dürrenmatt "Die Physiker".

Even the media are blinded by the vibe around unpredictable
anarchist technologies and bored by technologies that were born
with a specific aim and are working to fulfil that.

Post by IngeGNUe
It's worth noting that the other side of the 'coin' here, the side that
ZCash is on, is the ethical necessity of private transactions. There is
no doubt that sometimes people need that transaction privacy, for
ethically good, or simply personal, reasons.

We would need a cryptographic means to ensure that the
legitimate private use of digital currency does not scale
up to the levels that make it useful as a digital tax haven.
Until such a method is devised we have to stick to physical
cash for person-to-person private exchanges.

Also, just because you have income in form of taler and
need to declare it to your tax office when it exceeds
certain thresholds doesn't mean you can't declare a
reasonable amount to be achieved by exchange of private goods,
excempt from taxes. That should work in most countries even today.
You print out a paper declaring you got 400€ in taler for
selling your old laptop and sign it, submit it, done.

[Christian Grothoff]

Actually, our ideal goes slightly beyond that: you don't submit
anything. You just pay your taxes following the rules, and IF the
government decides to do an audit, the you have to submit the
(cryptographically signed) contracts as evidence that you did pay the
right amount of taxes based on the rules.

So for those years where you are not audited, the government doesn't
even need to get records. And we can all understand that probabilistic
audits with reasonably high penalties in relation to the audit frequency
(for example, say the fine is 5x of what you owed if you did it wrong,
then audit at greater than 1/5 probability) is perfectly sufficient as
it eliminates the economic incentive to cheat by making the expected
return on fraud negative. This way, your private business (like private
sales) could really remains completely private 4/5 of the time (except
you don't know in which cases it might be revealed).

And of course, as Lynx said, the specific rules of if/when transactions
are subject to tax is up to the government to determine.

Post by carlo von lynX
Also, just because you have income in form of taler and
need to declare it to your tax office when it exceeds
certain thresholds doesn't mean you can't declare a
reasonable amount to be achieved by exchange of private goods,
excempt from taxes. That should work in most countries even today.
You print out a paper declaring you got 400€ in taler for
selling your old laptop and sign it, submit it, done.

[carlo von lynX]

Post by Christian Grothoff
Actually, our ideal goes slightly beyond that: you don't submit
anything. You just pay your taxes following the rules, and IF the
government decides to do an audit, the you have to submit the
(cryptographically signed) contracts as evidence that you did pay the
right amount of taxes based on the rules.

Oh, even better than I thought. Cool.

This whole blockchain/fry-your-cpu-and-bandwidth technology
vs. taler/gnunet/secushare/liquiddemocracy technology that
was actually designed to do something ethically meaningful
reminds me of a general pattern in the history of software
development. a popular hacker fallacy: the teen-age tendency
to rewrite everything from scratch vs the adult understanding
of refactoring things step by step with a clear perspective.

Blockchain people are trying to rewrite the world from
scratch and don't bother if they introduce more and bigger
and less predictable bugs than the existing world currently
has whereas we are trying to refactor design aspects of the
world such as the data prostitution capital model and the
broken representative part of democracy, and we have a clear
plan indicating precisely how to get there.

Developing an ethical consciousness of technology can be a
part of growing up, unless you are already enjoying the
forbidden fruit of Ayn Rand's fallacious ideology and now
need an excuse to legitimize your egocentricity.

[IngeGNUe]

Post by carlo von lynX
blockchain/fry-your-cpu-and-bandwidth technology
vs. taler/gnunet/secushare/liquiddemocracy technology

Thanks to both lynX and Christian, for bringing this up. The latter is
clearly better. I had recalled SecuShare describing the incorporation of
transactions into their infrastructure.

I have been unable to donate to SecuShare and GNUnet because getting
bitcoins is too hard...

Anyway, I look forward to the release of Taler!

[carlo von lynX]

Post by carlo von lynX
vs. taler/gnunet/secushare/liquiddemocracy technology

You shouldn't put them all in the same bag: liquiddemocracy is a time
sync that requires professional users to keep an eye on things for

That has not been the case in the past, why should it be a precondition
in the future?

others. I can't imagine one second such an approach will work that
promotes a unique ('rational'?) interface to political issues through
written language with no human interaction. It's the kind of technology

Who impedes human interaction?

that takes the problem on its head, requiring more human attention and
less live interaction. I'd rather not use any technology at all than

It's just more screen work than paperwork, more transparency by
documentation instead of getting convinced by a lobbyist over a beer.

waste my time on such a system. Requiring it to participate in
legislation sounds exclusive to me. Politics can and should be made
human-to-human, not running away with the machine. There's a huge

We can see how successful human-to-human politics has been in the past.

non-verbal dimension in human communication that is not captured by this
system. We already know what a statistical perspective on politics is
able to bring to the world. We don't need more autistic politicians.

Do you have any papers backing your position or are you just opinating?

Too late to save the Pirate movement, only in 2015 scientists made a
profound analysis of the effects of liquid delegation on the democratic
intentions. The paper that you should absolutely be aware of resides at

http://arxiv.org/abs/1503.07723

What those non-pirate people found was that the promise of liquid
democracy actually proved true: delegations were "stabilizing" the
political outcome of liquid feedback even in the face of majorities
of participants being distracted by other political issues or simply
being busy watching soccer on TV.

What we know now is that the liquid modeling of a representative
approach actually works and actually reduces the risks of demagogy
that come with direct democracy. Still, there are reasonable and
unreasonable ways of setting up a liquid democratic platform.
Depending on the legal architecture around it you can either reap
the best of both direct and representative democracy or earn the
worst of both worlds.

Let's understand: electronic democracy has many enemies - anyone who
would prefer to have things done their way rather than having to
listen to some thousand strangers clicking their vote from their sofas.
And being against something is usually much easier than being for it.
Demagogy and populism does the rest. As frequently in politics, if
we're not going to be scientific about this, we will succumb.

Post by carlo von lynX
Blockchain people

Not the same bag either. Some blockchains can be useful in some contexts.

Consensus protocols may be. I still haven't seen a scientifically
convincing use of blockchains that I couldn't have done with
secushare pubsubs over gnunet without damaging the environment.

Since we know about the quantum, we don't live anymore in an either/or
world. Sustaining that vision is retrograde and harmful.

What does the quantum have to do with that?

Post by carlo von lynX
Developing an ethical consciousness of technology can be a
part of growing up, unless you are already enjoying the
forbidden fruit of Ayn Rand's fallacious ideology and now
need an excuse to legitimize your egocentricity.

Indeed.

I like that you agree on the most radical thing I said. :)