Subject: [Bitcoin-development] Making bitcoin traceability harder

From: Faré <[email-masked]>
Date: Tue, 20 Aug 2013 23:39:12 -0400

Dear bitcoin developers,

trading arbitrary amounts of bitcoins makes it easier to trace who
does what just by observing the amounts being traded, and where the
residual money ends up: e.g. you can identify that obviously, the
recurrent user of address A sent 2.5 bitcoins to the recurrent user of
address B, keeping the rest of his money in A. If instead bitcoin
users practice the discipline, enforced by the client software by
default, of only keeping a power-of-two amount of satoshis in use-once
wallets except where public donation addresses are meant, then tracing
suddenly becomes much harder.

Whether this particular discipline is the best to implement or not,
shouldn't bitcoin clients enforce SOME discipline that makes tracing
harder? After all we know that uniformed goons are eager to watch
who's trading with whom and to crack down on users. We shouldn't be
making it easy for them, though this will mean slightly higher
transaction cost. Merchants would then generate not one but a series
of new addresses at each transaction, and the customer would send
appropriately sized buckets of satoshis to each of the addresses.
There should just be a standard way to specify an amount and a list of
addresses as a target for payment, that merchants can communicate to
customers (though that might require e.g. higher resolution QR codes).

Has this idea already been considered before? Accepted or rejected?

—♯ƒ • François-René ÐVB Rideau •Reflection&Cybernethics• http://fare.tunes.org
Of course, Third World leaders love you. By ascribing third world ills to
First World sins, you absolve them of blame for their countries' failure to
advance. — John McCarthy