DarkWallet Aims To Be The Anarchist's Bitcoin App Of Choice

DarkWallet Aims To Be The Anarchist's Bitcoin App Of Choice




Bitcoin may be the world’s first decentralized, stateless digital currency. But in the eyes of at least one group of anarchists, the Bitcoin community has been getting a little too cozy with the establishment. And they want to bring the cryptocurrency back to its anti-regulatory roots.


On Thursday a group of libertarian Bitcoin developers calling themselves Unsystem launched a crowdfunding campaign to raise money to code a new Bitcoin “wallet” they’re calling DarkWallet. Like any Bitcoin wallet, DarkWallet will store a user’s Bitcoins and interact with the Bitcoin network, allowing the owner to spend and receive the currency. But unlike other wallets, DarkWallet is designed specifically to preserve and even enhance the properties of Bitcoin that make it a potentially anonymous, tough-to-trace coin of the Internet underground.


“If Bitcoin represents anything to us, it’s the ability to forbid the government,” says Cody Wilson, DarkWallet’s project manager. (If Wilson’s name sounds familiar, he’s also the creator of the world’s first fully 3D-printable gun, another project designed to show how technology can undermine government regulation.) “DarkWallet is your way of locking out the State, flipping the channel to one beyond observation.”


To publicize DarkWallet’s fundraising campaign on the site Indiegogo, Wilson created this rather dramatic YouTube video:

http://www.youtube.com/watch?v=Ouo7Q6Cf_yc
http://www.youtube.com/watch?v=Ouo7Q6Cf_yc


Bitcoin has already served as a powerful tool for the so-called “dark web”– the lawless, anonymity-enabled corners of the Internet alluded to in some parts of Wilson’s video. Bitcoin’s most recent moment in the spotlight came with the shutdown of the Silk Road, the Bitcoin-based anonymous online marketplace for illegal drugs that generated hundreds of millions of dollars worth of sales in its 2.5 years online; The FBI seized another $28.5 million in stored bitcoins believed to belong to the site’s now-arrested alleged owner 29-year-old Ross Ulbricht just last week.


Bitcoin enabled the Silk Road by acting as a trustworthy form of payment that didn’t require any real names. Though all Bitcoin transactions are publicly visible within the Bitcoin network, they’re only linked to pseudonyms, and users can anonymize the coins further by sending them through a Bitcoin laundry that mixes up users’ bitcoins with those of other users to make them harder to trace; Silk Road automatically mixed the coins of all its users.


But DarkWallet would go further towards making Bitcoin a truly untraceable form of digital cash. The wallet creators plan to include a feature called “trustless mixing” according to Amir Taaki, one of Unsystem’s founders and a longtime Bitcoin developer. Rather than hand a user’s bitcoins off to a typical Bitcoin laundry service that must be trusted to send back another more anonymous bitcoin, trustless mixing bundles together a collection of Bitcoin transactions and simultaneously sends them to new Bitcoin addresses that are also controlled by the same users; Since no one watching the transactions can see whose coins went where, the technique erases any ownership-identifying traces on the coins, while also avoiding the problem of trusting a third-party service to sufficiently mix the coins and not to simply steal them.


The software, which is intended to be a browser plug-in for Chrome and Firefox, would automatically coordinate the process with other users over the anonymity service Tor or similar services to further hide users’ identities. The process could even be reduced to an anonymizing “toggle switch” that would enable users to launder their coins on command, says Taaki. “You buy the bitcoins in a normal exchange, switch this on, and it slowly anonymizes them for you in the background,” he says.


DarkWallet would also aim to solve another potential privacy problem with Bitcoin that arises from wallet software “announcing” transactions to the Bitcoin network from a tell-tale IP address. By broadcasting the messages from a proxy address or over the Tor network, Taaki says that DarkWallet could prevent anyone from tracking a user based on those transaction announcements.


Wilson and Taaki see DarkWallet in part as an answer to Bitcoin’s increasing adoption by users and developers with more mainstream, government-friendly views. In the video above and in their writeup of DarkWallet on Unsystem’s website, they directly attack the Bitcoin Foundation, a non-profit group that has sought to engage with governments and use lobbying tactics to compromise on potential regulation of Bitcoin. “Many prominent Bitcoin developers are actively in collusion with members of law enforcement and seeking approval from government legislators,” reads one portion of the DarkWallet text. “We believe this is not in Bitcoin user’s self interest, and instead serves wealthy business interests that make up the self-titled Bitcoin Foundation.”


When I point out those criticism to Gavin Andresen, a Bitcoin Foundation founder and its chief scientist, he says that he’s met with government agencies including the CIA, but only with the intention of explaining Bitcoin, not helping to regulate it. “What we’re trying to do is educate regulators on what Bitcoin is and isn’t and influence how the existing regulations are applied to Bitcoin, so that we get the best possible outcome and regulations aren’t heavy handed,” says Andresen. “We want to see Bitcoin succeed. We just think that talking and being open about it is better than trying to work undercover in the shadows of some kind of ‘dark web.’”


With or without the Bitcoin Foundation’s approval, attempts to regulate Bitcoin are coming. The anti-money-laundering agency the Financial Crime Enforcement Network announced in March that some Bitcoin organizations would have to register as Money Service Businesses and follow the same money laundering regulations as users of traditional currencies. In May, the Department of Justice indicted the operators of Liberty Reserve, a Bitcoin-like alternative currency scheme, accusing them of running a $6 billion money-laundering operation. And under pressure from regulators, the biggest Bitcoin exchange Mt. Gox announced later that month that it would require identifying documents for all users trading bitcoins for dollars.


Those moves to tighten the controls around Bitcoin are exactly why a service like DarkWallet is needed, argues Unsystem’s Amir Taaki. He sees the software’s anonymity features as part of an “arms race” with regulators that’s necessary to preserve Bitcoin’s original libertarian purpose.


“We need to investigate new methods and put them into practice, respond to challenges and adapt,” he says. ”You need people researching tools to empower individuals, give them anonymity, get around censorship and surveillance. Just putting Bitcoin out there isn’t enough.”

http://www.forbes.com/sites/andygree...app-of-choice/