Dec 18, 2013

value, counterfeits, authentication, and trust

these statements seem indisputable:

the more valuable a class of objects becomes, the more likely it is that someone will try to counterfeit instances of the class.

the more counterfeiting attempts there are, the more likely it is that good counterfeits will be produced.

the better the counterfeits, the more effortful it will be to authenticate any object.

trust in the value of the class of objects is proportional to the ease with which any instance of the class can be authenticated.
let us consider the implications of this for bitcoin. the only media of exchange that are systemically immune to authentication-related trust failures (though not immune to local trust failures) are those in which trust in the medium is highly distributed.

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