The Manifesto disappointed cryptoanalyst: We are mired in conferences and dreams of “Lambo”
CoinDesk asked legendary shirobana Timothy may, author of “Manifesto of cryptoanalyst”, writing to Express thoughts about white paper of bitcoin is the tenth anniversary of the creation of this cryptocurrency. In response, he 30 pages he ruthlessly criticized the industry, which he considers to have lost touch with the origins. Online resource published this text, presenting it in the form of questions and answers. We offer you a translation.
CoinDesk: Now, when bitcoin entered the history books, what place, in your opinion, is it a white paper in the Pantheon of the achievements of the financial cryptography?
Timothy may: For starters, watching what is happening with bitcoin and its varieties for the past ten years, I have some interest, well-known surprise and strong disappointment.
In the Pantheon of bitcoin deserves the place of honor, because this may be the most important invention since, as has been developed the method of double entry in accounting. I don’t know what Satoshi wanted to see his creation, but I don’t think his vision included a cryptocurrency exchanges with their draconian laws about identity verification and anti-money laundering, freezing of accounts and mandatory cooperation with the secret police for “suspicious activity”. A high probability that all this talk about control, regulation and blockchain will result in the creation of a society of total surveillance and control, where each will lead a private matter.
I think Satoshi would puke if he saw what is happening. Or this sight would have prompted him at least to create a bitcoin replacement that he was going to do in 2008— 2009. I’m not ready to give a high evaluation to the current status of phenomena and to praise the supposedly great achievements along the way.
Undoubtedly, bitcoin and its variants — a pair of forks and numerous altcoins — are more or less as planned. Bitcoin you can buy or mine, you can quickly forward in different ways with low commissions and also sell for tens of minutes, sometimes faster. It does not require any approval or centralized intermediaries, nor the confidence of the parties. In addition, buying bitcoin, you can store it for years.
However, the tsunami that hit the world of traditional Finance, has left behind the ruins and confusion, fragments of knowledge and failed experiments. In General, the “creative destruction” by Schumpeter. All of this is not yet ready for Prime time. Unless someone expects that his mom will download the latest client from GitHub, compile on one platform and using terminal to restore settings?
I can see how hundreds of millions are drowning in a maelstrom of software glitches, theft, fraud, delusional ICO projects. And talented people who could draw on themselves the ambitious plans can be counted on the fingers.
Please forgive me, if damage to you this story, but I think she’s in big trouble. Satoshi made (made, made) a great invention, but the project is not completed yet. The author himself admitted that the version of bitcoin 2008 is not manna from heaven.
CoinDesk: How do you think your view is shared by other members of the community Shirobokov? That creates interest in the industry, and what kills him?
Timothy may: Honestly, the novelty of the ideas of white paper and, subsequently, early usage scenarios for such phenomena as the Silk Road brought many into the world of bitcoin. If the project has been focused on compliance and work with banks, interest would be much more modest. (Projects for the electronic transmission of values such as SET, Secure Electronic Transfer occurred before, and they were unbearably boring. In the SET there was no innovation, and 99% of the associated text is written in legalese. Chiromancy ignored it.)
It is true that some of us interested in “financial cryptography”, when it began to move. With the exception of David Choma, Stuart Haber, Scott Stornetta and several other, mostly academic cryptographers before doing the mathematical aspect of cryptology: the financial aspects of their little interest.
Of course, over the last ten years the situation has changed. At least tens of thousands of people interested in bitcoin and bloccano: almost every week are a major conference. Now many people are interested in “era of bitcoin”, which began in approximately 2008— 2010, prior to that important event.
The story is a natural way for people to understand the nature of things. I’m talking about history as a linear narrative. I’m not going to speculate about the future. I have already talked about the “obvious consequences” from 1988 to 1998, starting with “the Manifesto of cryptoanalyst” in 1988 and the creation of groups and mailing list for Shirobokov in 1992.
CoinDesk: you Seem to think that bitcoin has deviated from its principles, and the company lost contact with the measurement Shirobokov.
Timothy may: Yes, the greed, the hype over bitcoin and yelling in key “to heaven” and “HODL” is unprecedented. I’ve never seen or heard anything like it. Not in the sense of “tulipomania”, a giant rising prices, but in the sense that all this involved hundreds of companies, thousands of people, from reports is breathtaking. Is the creation of idols and worship them. This HYIP is better than what we saw in the dotcom era. I think that is undue emphasis on publicity: conferences, white paper and press releases. Everyone is trying to sell something.
Individuals and companies seek to stake out rights. Some have hundreds or thousands of patent applications that apparently represent variations of the basic ideas, including those about which much was said in the 1990s. Let’s hope patent office will reject some of them.
The key issue is the conflict of privacy (or anonymity) and the model “know your customer”. It is a conflict “decentralized, anarchist and peer-to-peer” and “centralized, limited and baccarani”. Understand that many supporters of privacy — chiromancy, Satoshi and other pioneers — clearly defended the idea of an open, not requiring permits p2p money transfer system. Some also saw it as a replacement Vietnam money.
One of the leading pioneers, David Choma, very early thinking about the issue of the anonymity of buyers. For example, the fact that in a large store, the seller, receiving payment, should not know the identity of the client. (Clearly, now the system works differently. Walmart, Costco and similar stores are a detailed record of purchases, and police interrogators can buy these notes or to get them on the court. In some countries, governments have misused such information.)
Do not forget that the buyer may be many reasons not to reveal their preferences. Both buyers and sellers need protection from tracking: the seller data about the means of fertility control in many countries has more risks than the buyer. And there are still such things as an insult, blasphemy, and political activism. Models like Digicash, which is focused on the anonymity of the buyer (for example, a customer of the store or the driver on the toll road), lacks a key ingredient: the majority of people prosecuted for statements or political beliefs are just to the sellers.
In fact, Satoshi was trying to resolve the conflict arising from monitoring activity of buyers and sellers, providing BOTH the opportunity to avoid surveillance. But his solution is imperfect, so a large-scale development continues.
CoinDesk: so you think that the developers of bitcoin and cryptocurrency have to fight with the authorities, which, in fact, not in solidarity with them in seeking to implement a truly innovative technology?
Timothy may: Yes, many of us are not interested in the fact that bitcoin has become another PayPal — the new system of Bank transfers. We know the answer to a different question: how to bypass “time”, collectors exorbitant commissions and intermediaries to decide whether Wikileaks (here is a recent example) to receive donations. And how to allow people to send money abroad.
Attempts to “make friends” with the regulators is likely to kill the key usage scenarios of cryptocurrencies, which should NOT be variations on the theme of PayPal or Visa.
Scenarios for using blockchain technology of a more General nature — that’s another story. Many scenarios will be “friendly to the requirements of the regulators.” Of course, some assumed scenarios, such as logistics management through a private or public blockchains, not particularly interesting.
Often point to the fact that the distributed registry is not a new invention but simply the version of the database. Again, it is naive to think that corporations will want to make available to the public contracts, the procurement of materials, delivery dates, etc.
Don’t forget that universal jubilation in connection with bitcoin, due mainly to the prospect to circumvent the control, implement a new exotic usage scenarios, such as the Silk Road. It was about a cool, bold, avant-garde the phenomenon, not about the new PayPal.
CoinDesk: do You want to say that we must stop thinking regionally and to try to understand how to apply this technology in new ways, and not to use it for creating remakes of what is already there?
Timothy may: People should do what they are interested in. It originated as the most innovative phenomena: BitTorrent, mix— net, bitcoin and other. So I’m not sure what to try to understand how “to apply this technology in a new way” is the best way. Intuitively, I feel led by the idea-people will do what they are interested in. People from corporations will likely not achieve much success, “trying to understand”, etc.
Money is speech. Checks, ious, supply contracts, hawala — all of these models are used as forms of money. Nick Szabo has pointed out that bitcoin and some other cryptocurrencies have most of the features (if not all) of gold, and thus deprived of its shortcomings. So, bitcoin has no weight, it is difficult to steal, to impose on him the arrest, it is also possible to send the most primitive channels in a matter of minutes, rather than during long hours of air travel, as it happens in the case of gold bullion moved from place to place. However, neither banknotes nor coins, nor even checks that look “official”, nothing is sacred. These centralized systems depend on trusted third parties such as banks or the state due to which the possible legal and government guarantees.
Shipment of bitcoins, by contrast, is equivalent to “say” the number of (mathematically more complex, but the General model is). To forbid to “speak” the number — all the same what to forbid any other statement. This does not mean that technology cannot be contained. At the time the court heard the case of “print PGP code”, otherwise known as the organization Defense Distributed and Cody Wilson designer. The court then ruled:
The printed word rarely does not fall under the First amendment to the U.S. Constitution (guaranteeing freedom of speech and press).
CoinDesk: I think here you are implying that some degree of censorship is necessary if we want to fully or at least partially rebuild the economy.
Timothy may: Some contact with the legal system of the United States or the rest of the world is inevitable. The slogans in the spirit of “code becomes law” is more of a dream than a reality. Bitcoin is bitcoin, it largely does not depend on laws. Bitcoin payments are not subject to returns, cancellations, etc., This situation may change. But in the existing scheme, the parties of the transaction are anonymous, information about their jurisdictions, no; it is not even clear what laws apply to them.
However, I think that almost all new technologies have had usage scenarios that someone did not like. The printing press Gutenberg was clearly not to the liking of the Catholic Church. But does this mean that the printing presses should license or regulate? Always was improper or even criminal scenario, the use of new technologies (though improper for the Soviet Union could not be so for Americans). Information about contraception was banned in Ireland, Saudi Arabia, etc. Examples are numerous: the guns, printing presses, telephones, copiers, computers, cassette recorders…
CoinDesk: are There now blockchain or cryptocurrency, which correspond to its purpose? Did bitcoin to implement your plan?
Timothy may: As I said, bitcoin is by and large fulfilled the mission entrusted to him by the creators. It allows you to send, store and can be used for speculation. This can not be said about dozens of major and hundreds of smaller variations of bitcoin that have no obvious and clear usage scenarios.
The concept of “reputation token”, “token attention”, “charity tokens” seem to me to be immature. None of them compete with bitcoin. Even Ethereum, with its alternative model, only to find an interesting usage scenarios (at least none that I saw — I admit that I do not have time and desire every day to spend hours on reading reviews on Reddit and Twitter).
Blockchain, which has become an independent and rapidly growing industry that is moving in several directions: private baccani, Bank baccani, public baccani, even the bitcoin blockchain. Some usage scenarios can be useful, but there are those that seem to be speculative and frivolous. Proposals of marriage on the blockchain — what is it?
A lot of small companies, large consortia, alternative cryptocurrencies, ICO projects, conferences, exhibitions, forks, new protocols cause confusion, and new conferences are held almost every week! People are flying from Tokyo to Kiev, and from there to Cancun to participate in the next event, which will be delayed for three to five days. The most modest events of this kind attract hundreds of fans, the largest managed to gather a crowd of 8,000 people.
Meanwhile, the new credit card presented without any pomp, and bitcoin, by the way, too. People can not constantly wasting mental energy on reading technical documents, follow the weekly ads and endless debate. On a relatively minor phenomenon that you spend too much mental energy.
People who send large sums to use basic things with bitcoin or the Bitcoin Cash, rather than exotic innovations like the Lightning or Avalanche.
CoinDesk: You are at least optimistic in regard to cryptocurrencies as a means of remittances.
Timothy may: it would Be a tragedy if the race of technology, which mistakenly referred to as a cryptocurrency (and the pursuit of profit from them) will lead to the creation of societies of a total surveillance and police control, which has no analogues in the world history. I’m just saying that the danger is obvious.
In the case of the execution of the law on customer identification cryptocurrency remittances will not be the same as current regular orders or even wire transfers, cheques, etc. In the case of the introduction of the so-called “know your client” it will be much worse. And some countries are already moving towards this goal.
We must fight the phenomenon of “driving licence for use of the Internet”.
CoinDesk: This development is probably. But because all of the current Internet, we can say that it is not in accordance with the plan 100%, however beneficial, contributing to the progress of mankind.
Timothy may: I just want to note that we risk to come to managing money and cash transfers, such limitation of freedom of speech. Is this achievement? If Alice can deny to say: “I’m happy that week to pay you a dollar for that cheese sandwich,” then what is it if not restricting freedom of speech? The rule “know your customer” can be easily applied to books and publishing: “Know your reader”.
I am saying there are two paths: the path of freedom and the way of the limited and centralized systems. This fork was discussed extensively 25 years ago. The government and types of law enforcement agencies even, in fact, did not Express disagreement: they saw the approach of the fork. Today we have accounting systems, scanners (on elevators, transfer points, transport routes), tools for encryption, cache, privacy, forced decoding, backdoors…
In an era when someone’s smartphone or computer can have gigabytes of photos, correspondence, business information (more than was in the whole of the House of representatives at a time when we were writing “bill of rights”), illegal access to phone and computers is alarming.
Many countries in this respect even worse than America. Needs new tools of data protection, and legislators need education.
It seems that large companies are trying to subdue the blockchain corporations: Yes consortia, cartels, even seeking to bring this technology to “comply with the requirements of regulators”.
Many people want to believe that legal protection and judicial review will stop the abuse, at least in the U.S. and certain other countries. However, we know that the us authorities played the role of despots and tyrants (the Mormons were persecuted, killed and forced into death marches of native Americans, allowed lynchings, ethnic Japanese interned).
How will Iran and China apply the rule of “know the writer” (which will inevitably result in the rule “know your customer”)?
CoinDesk: it Seems we’ve deviated from the topic of technology. Is that what you say is not a question of power and balance of power? Surely the Internet has ceased to benefit, even becoming more centralized?
Timothy may: of Course, the Internet tsunami washed up a lot of good. But China already uses a huge database (with the help of companies that develop search engines) for ratings of “civic loyalty” on the basis of which citizens may be denied access to banking services, hotels and travel agencies. Behind the social media giant Corporation willing to help build a society of total surveillance (they deny it but their actions speak for themselves).
I don’t want my words sounded like the rantings of leftists on Big brother, but any person with libertarian views, or member of the libertarian party is the real cause for concern. Many writers and thinkers for decades ago predicted the emergence of a society of total surveillance, and controls have since made great progress.
In thermodynamics and in mechanical systems with moving parts is the degrees of freedom. The valve can move up or down, the motor can rotate etc. I believe that social and economic systems can be described in a similar way. Some phenomena increase the degree of freedom, while others reduce them.
CoinDesk: have You thought to write in detail about the state of cryptocurrency in our days is to say something new, relying on their old works?
Timothy may: Probably not. From 1992 to 1995 every day I devoted hours to literary work and is not ready to repeat this. A little sad that my work has not led to the appearance of the book, but I bear this blow stoically.
CoinDesk: You are well known of the early history of the movement Shirobokov. Do you see Parallels with what is happening in the world of cryptocurrency?
Timothy may: 30 Years ago I was interested in the scripts to use powerful cryptography. Not so much in terms of “secret messages”, but in the aspects of money transfer, overcoming barriers, free from control by the authorities of transactions that are voluntary associations.
I began to call this phenomenon cryptomeria and in 1988 wrote “the Manifesto of cryptoanalyst” on the grounds of another famous Manifesto. The ideological Foundation of this work was “anarcho— capitalism”, a well-known kind of anarchism. (It has nothing to do with the Russian anarchists or anarcho— syndicalists, the emphasis is only on the free market and voluntary transactions.)
At that time, held one major conference, Crypto, and two less popular, EuroCrypt and AsiaCrypt. At academic conferences almost never read reports about the economy and the institutions (politics, if you will). Was conducted an important development in the field of game theory: for example, then an amazing work of Micali, Goldwasser and Rakoff “Interactive system of the proof with zero disclosure.”
For several years I have studied all these ideas. After leaving Intel in 1986 (thanks, the stock has increased in price a hundred times!), I would spend days reading the material on cryptography, thinking about new possible structures. I was interested in phenomena such as the harbour data in cyberspace, new financial institutions, cryptography, with an interim disclosure, digital caches on the basis of steganography and, of course, digital money.
At that time I met Eric Hughes, and he came to visit me in the suburbs of Santa Cruz. We decided to gather the most talented people in our communities and to discuss all these topics. In the late summer of 1992 we held our first meeting in the house that I hadn’t removed in the area of the Oakland hills.
CoinDesk: have you ever Had the feeling that there will be something like bitcoin or cryptocurrencies?
Timothy may: it’s Funny that in that first meeting, I gave the participants the money from the game “Monopoly”, which I bought at the toy store. (It was ironic because years later, in 2009— 2011, bitcoin seemed to people the in-game currency — remember the story of the pizza.)
I gave money to the Monopoly equally to all participants, and we use them feigned tryptomer with data havens, black market and rellerli (“mixes” Choma). As a joke we set up a system like the Silk Road of the future. (Many journalists have asked me why I did not widely disseminate this concept, and I replied that I was not wanted in jail. Although in the United States the publication of ideas protected by the law on the freedom of speech, at least not yet.)
We began to meet once a month, and even more often, and quickly formed a mailing list. They were headed by John Gilmore and Hugh Daniel.
There was no moderation, no dropouts, no censorship (in the narrow sense of the word, I’m not talking about government censorship, which of course was not in sight). A policy of “zero moderation” was accompanied by a policy of “zero leadership”.
A group of about 20 people wrote 80% of compositions and messages. No organizational structure was not. (We thought that its absence would better protect us from possible persecution by the authorities.)
And, of course, this approach is consistent with the idea of a polycentric, distributed, do not require permits p2p structure. It is a kind of anarchy in the true sense of the word: no “Arche”, the authorities, and the chief, “archon”. These topics are covered in detail in the books of David Friedman’s “the Mechanics of freedom” and Bruce Benson’s “Business of law”. Benson considered the possibility of the existence of legal systems in which there is no Central control.
Anarchy is a way the default action of most people who wish to decide for themselves what they eat, with whom to communicate, what to read and watch. And whenever a government or a tyrant trying to limit their choice, they find a means to circumvent the prohibitions: use of contraception, reading samizdat literature, listening to the enemy “voices”, copying tapes, use the stick…
All this might have impacted on the concept of bitcoin, which was later formulated by Satoshi Nakamoto.
CoinDesk: What was your first reaction to the message Satoshi? You remember what was the impression of his ideas?
Timothy may: I did other things and have not followed the discussions. My friend Nick Szabo spoke about these developments in 2006— 2008. When I first heard about the Satoshi white paper and the first “gaming” transactions, I experienced, like many others, contented little interest. I could not imagine that bitcoin will reach such a serious success, which we are seeing now.
He/she/they discussed aspects of a possible digital currency and tried to figure out how to make it interesting. Then, in 2008, Satoshi Nakamoto released a white paper. The document has provoked much discussion, but many took it very skeptical.
In early 2009 appeared alpha version of bitcoin. Hal Finney was involved in the first transaction a couple with Satoshi. It was followed by others. Satoshi himself (or is it themselves?) said that bitcoin will either decrease in value to zero, or will cost “a lot”. I think that many believed the first scenario and thought bitcoin would crash on the information superhighway, and many other projects. The famous purchase of pizza shows that the majority considered bitcoin “toy” money.
CoinDesk: You think so now? Or the rising price forced to abandon this idea?
Timothy may: No, it’s no longer play money. For several years now. But this is not a replacement Vietnam money, paper. Alternative to a Bank transfer or hawala — no doubt. Cryptocurrencies function as a money transfer system, they are functional on the black market, etc.
I’ve never seen such hype, mania. Even during the dotcom bubble, Pets.com when people discussed how much they earn, buying shares. (When the bubble burst in Silicon valley, joked: “It’s a new start-up “Free space”? Because office buildings in the district were empty.)
I still think that bitcoin is too complicated… Coins, forks, sharding, network ofcan directed acyclic graphs, the proof of execution of work vs proof of share ownership is to an ordinary person it is difficult to understand. But what are the real usage scenarios?
There is talk about what cryptocurrency in the end will replace the banking system, credit cards, PayPal, etc. Is all great, but what cryptocurrency can NOW?
The most compelling scenario, which I hear is a situation when someone sends money to the user who doesn’t have PayPal, Visa, banks and money transfer systems. Everything else — the hype, the evangelism, HODL, “get rich and buy a Lambo” and other debris.
CoinDesk: so you think that’s bad. You do not accept the argument that, over time, gradually…
Timothy may: Yes, sometimes the creation of new takes time. Designers draw lessons from the crash and dam failure. But the ecosystem is replete with flaws that are apparent. Here and code errors, and conceptual shortcomings, and weak defense. As a result, hundreds of millions of dollars lost, stolen, frozen forever…
If banks lost money in the same way as cryptocurrency projects, hysteria would be still the same. When the vaults began to crack, the manufacturers have studied vulnerabilities and have made changes to the design.
Universities are not fast enough to prepare even cryptocurrency engineers, not to mention the researchers. Cryptocurrency requires extensive knowledge in many specific fields: game theory, probability theory, Finance, programming.
Any child understands how to use the coin in 25 cents. He sees how people use coins, dollar bills — their model of work is clear.
When the first time I got a credit card I didn’t have to waste time reading manuals, not to mention to download wallets and tools cold storage. I didn’t have to study and compare protocols. Everything just worked, and the money didn’t just disappear.
CoinDesk: it Seems that you don’t like how the industry has mixed innovation and speculation…
Timothy may: Innovation is good. I’ve seen a lot of innovation in the industry of producing chips. But we did not hold a conference EVERY WEEK! And not declared on the products. Not created a number of new companies. Not attracted through the launch of the ICO hundreds of millions of dollars, taking advantage of the naivety of people hoping to find a “new bitcoin”.
Among those of my friends who work in cryptocurrency companies and stock exchanges, dominated by speculative interest. Therefore, they often keep their cryptocurrency exchanges: for fast trading, shorting, hedging, but NOT to buy something or transfer funds outside the normal channels.
CoinDesk: You are well aware of all aspects of this field. Must you have specific ideas about what it should be?
Timothy may: Perhaps I spent too much time reading discussions on Reddit and Twitter (by the way, their own Twitter account I have).
What should it be? As they say, people decide for themselves what to do with the technology. For some time the mass distribution had the Silk Road and the variations of this darkmarket. Then came the time of hodling, that is speculation. I heard that gambling is one of the main usage scenarios of Ethereum. Well, let the fools squander their money.
Whether the hype is justified? Will the cryptocurrency world? Possible. Undoubtedly, the world of the future will be networked, electronic, paperless. But while too much hype, too much publicity and too few people who understand the ideas. People seemed to suddenly found out that the unknown the world is huge, and thousands of them started to build boats in the back yards. Someone will reach your goal, but most will either quit construction halfway, or drown in the sea.
At the time we published extensive manifestos. We did not do it to impose anyone your vision and to show a possible way. This is partly as giving advice to the cat: it is impossible to tell, you can only suggest something, and sometimes the cat agrees.
A brief summary of Timothy may
You should not use something just because the idea sounds great. Technology should be used, if it really solves the problem (in our days of crypto-currencies solve the problem of few people, at least in first world countries).
Most of our problems can not be solved by cryptocurrencies or similar technology (and stuff like “improved systems of donations” most people are not interesting).
If you are engaged in dangerous transactions, you should exercise “operational security”. Let’s see how caught Ross Ulbricht.
Mathematics is not the law.
Cryptocurrency is still very far before it started to use the broad masses (even technicians).
Necessary in the interest of openness, freedom of transaction and freedom of speech that allows you to go back to the original explanation. Don’t waste time trying to create “friendly governments” financial alternatives.
Remember: the world is full of tyrants.