Many concepts central to Bitcoin were developed in an online community known as the Cypherpunks, a loosely organized group of digital privacy activists. As part of their mission, they set out to create digital money that would be as anonymous as physical cash. Mr. Szabo was a member, and in 1993, he wrote a message to fellow Cypherpunks describing the diverse motivations of attendees at a group meeting that had just taken place. Some people, he wrote,Nathaniel Popperare libertarians who want government out of our lives, others are liberals fighting the N.S.A., others find it great fun to ding people in power with cool hacks.
I admit I haven’t paid much attention to Bitcoin, I don’t understand how it works and why it should exist and this article hasn’t helped clarify these questions. The paragraph above caught my attention though: so the main ‘advantage’ is
as anonymous as physical cash. The thing is, physical cash comes with a lot of downsides as well. It can be stolen much easier, because there is no verification that a certain person owns a certain amount of cash. It’s also an easy way to avoid taxes, since no central authority can control how much cash you receive or pay. This makes cash the preferred currency for the underground economy: prostitution, drug dealers, trading in illegal weapons and the list goes on. Bitcoin may sound good in an utopian anarchy, but in our real world I think it will do more harm than good.
Once upon a time people thought the Internet was anonymous because IP addresses don't include names. Now they think that about Bitcoin.— zooko (@zooko) May 28, 2015