Sunday, August 26, 2012

Fascinating: WikiLeaks Bypasses Financial Blockade With Bitcoin

This is big for both Wikileaks and Bitcoin.

Jan Matonis writes:
Following a massive release of secret U.S. diplomatic cables in November 2010, donations to WikiLeaks were blocked by Bank of America, VISA, MasterCard, PayPal and Western Union on December 7th, 2010. Although private companies certainly have a right to select which transactions to process or not, the political environment produced less than a fair and objective decision. It was coordinated pressure exerted in a politicized climate by the U.S. government and it won’t be the last time that we see this type of pressure.
Fortunately, there is way around this and other financial blockades with a global payment method immune to political pressure and monetary censorship.
On its public bitcoin address, Wikileaks has taken in over $32,000 equivalent in more than 1,100 separate bitcoin donations throughout the blockade (1BTC = $10.00). But these amounts may be significantly higher, because it does not even include the individually-generated bitcoin addresses that WikiLeaks provides for donors upon request.
The ultimate success of bitcoin will depend on the number of people and organizations that use it as a way to operate against interventionist and snooping government. The more government puts pressure on  financial  transactions by monitoring and controlling transactions, the more it will drive people to use bitcoin, 


  1. Two things I will never understand are public/private key encryption and bitcoin.

    Whats to stop whomever controls creation of bitcoins from creating more and diluting their value?

    Are they convertible into dollars at 1=$10? I thought I read about a bitcoin crash in value.

    1. Bitcoins are difficult to understand. Having them be "inflation proof" was a part of their design. There can be no one in control of how many bitcoins there are, it is all a factor of the people who exchange bitcoins, part of the "handshake" of such an exchange is an agreement of how many bitcoins exist. No agreement means no exchange.

      That is cute that the story has bitcoins "pegged" to 10 USD. No, that relationship fluctuates a lot, but it has been in that ballpark recently.

    2. > Whats to stop whomever controls creation of bitcoins from creating more and diluting their value?

      The short answer? Math.

      Without knowledge of public key cryptography, then it's rather hard to explain - but there will never, ever be more than 21m Bitcoins in existence, unless 50%+1 of the computing resources on the Bitcoin network agree to a fundamental change of the protocol.

      > Are they convertible into dollars at 1=$10? I thought I read about a bitcoin crash in value.

      There was a bubble, and price went to about ~$30 USD / 1 BTC briefly. That corrected (a/k/a/ "crashed") back down to about $3 USD / 1 BTC. It has steadily increased in price back to ~$10 USD / 1 BTC today.

      Seriously - I have a basic understanding of how the network works, to the point that I've written some small pieces of software that operate against it. If there were a major flaw in the protocol, it would have been discovered by now. There is an effective bounty of millions of dollars for anyone that could exploit it that way.

    3. (NOTE: see offer to Bob and readers near the end)

      No one controls the creation of bitcoins. They're created by the completion of a series of mathematical functions that are visible to all. The biggest weakness of bitcoin is if someone gets control of 51% of the mining rigs in operation. In the long run, it's not a profitable venture to have control of the network, but if you're already made of money and just want to subvert or destroy it, it would still cost hundreds of millions to do so.

      Bitcoin is, first and foremost, a network protocol, like the web (http) or email (smtp). Like all protocols, it has its own particular means of moving data across its network and of validating that data. The miners are the network, essentially. They're the ones that do the accounting and the validating of all transactions on the network.

      The revolutionary thing about bitcoin is the "blockchain", a large chain of data that is connected to all other data in the chain via multiple hashing algorithms. No part of the chain can be changed without recomputing the entire blockchain, a process that is impossible unless one has the power of the largest distributed network in the world, which happens to be bitcoin's network at the moment.

      Bitcoin's blockchain is being looked at as a means of validating voting results. Proof of concept is here:

      Understanding public key crypto isn't necessary to using bitcoin but it does help. Though the math behind it is hard, the concept isn't: A message encrypted with a code exposed to the public can be decrypted with a key that is only known to a private party. Each bitcoin is an encrypted piece of data owned only by the party holding the private key to that coin. If I send you a bitcoin or a fraction thereof, I'm actually giving your bitcoin software the ability to read that encrypted data and rescinding my own use of it.

      Bitcoin is a lot to wrap one's brain around (remember how confused everyone was when the web became part of the mass consciousness?), but it's worth having a small piece of it.

      OFFER: to the first ten of Bob's readers that respond to this post with a bitcoin address, I'll send you a free 0.1 of a bitcoin. To get the software, go to:

      and download for your operating system. You might also have to do some research into it get the gist of it. Search google for the usual random help one might find. Or ask me. I'll be checking this thread off and for bitcoin recipients anyway.

      The amount I'm sending you is enough for a roughly 90-100 games of Satoshi Dice at .001 per bet. There are small transaction fees that go with each transaction, so it eats into your total (unless you're winning):

      Bitcoin, if it isn't severely subverted by the usual suspects, has a real possibility of being the beginning of decentralized thinking when it comes to money. I don't see it as a be all and end all but it certainly is the beginning of something.

    4. @Anonymous

      This article explains the origins and some of the cryptographic predecessors

      Also, I gave this presentation in South Africa recently: The Evolution of E-Money,

  2. Bitcoin value is based on public appreciation of the currency. The number of bitcoins are based on the processing of the combined users graphic processors connected to the network. There is a maximum number of bitcoins and new bitcoins are slowly created based on formulae.

    I'm going to arrange a bitcoin rep to discuss this with Mr. Wenzel.

  3. Interesting. The Bitcoin economy is really developing. I have wanted to subscribe to EPJ but do not want to pay the increased cost in terms of privacy, who knows who may round up whom in the future based on purchases, and have therefore boycotted EPJ for its refusal to accept bitcoin, especially when it is so easy to accept with services like or

  4. You do not understand the technology behind cell phones - and you use them. You do not have to understand Bitcoins - just use them (info : ). I just sent 1 BTC to WikiLeaks - so what are you waiting for ?

  5. Wenzel, you should consider accepting bitcoin for subscriptions. Free publicity, more sales, and - hey - you're you'd be accepting a free market currency!

  6. Paypal in Brazil is going to take a big dive once the Brazilian government discovers its hidden fees which hurt the consumer...

  7. Lets Help WIkileak donate here 1ALkRBYJWXmYMUqdRaZRPHbEM6exyLJ5GM