Bitcoin: Laying the foundation for a real-world Skynet?

Bitcoin: Laying the foundation for a real-world Skynet?

Summary: It's not about bitcoin as a currency. It's about bitcoin as a technology, a highly-distributed, leaderless, jurisdictionless, identityless, nearly anonymous decentralized architecture for managing ownership.


Imagine a self-regulating, world-wide, distributed digital system, engineered to operate beyond the management or control of any human, corporation, or government, impervious to government regulation or national jurisdiction, growing in size and reach exponentially. No police officer can arrest it. No spy organization can find it. No army can kill it. No human can stop it.

Sounds a lot like Skynet from the Terminator movies, doesn't it? In the Terminator franchise, a self-aware AI network created by the military broke free of human control with the intent of destroying the human race.

So, how do we get from bitcoin, a mere digital currency, to Skynet? It may not be as far-fetched as you think.

Back in time

To trace the untraceable, we're going to have to travel back in time almost 50 years, to 1969 (don't worry, you can keep your clothes on). It was quite the year of contrasts. On one hand, there was the Apollo moon landing. Tricky Dick became president. The Vietnam War was about to begin winding down. Woodstock. And the very earliest origins of the Internet.

Popular legend has it that the ARPANET, named after the Advanced Research Projects Agency of the US military, was created to provide unstoppable communications in the event of nuclear war. This claim is disputed by former ARPA director Charles Herzfeld, who -- at a 1994 BBN conference -- claimed that ARPANET was intended to give scientists access to a limited number of research computers. The fault-tolerant, distributed nature of what eventually became the Internet was actually the result of a RAND presentation on secure voice networking for the military.

Even so, the concept (and eventual reality) of the Internet was a decentralized system, able to withstand regular and unpredictable disconnections of nodes, with no true central authority. Today, of course, we know the Internet is not truly decentralized, but it also is not fully controlled by a single nation or authority.

The fundamental architectural technology underlying the entire Internet is packet switching. There are two key concepts in packet switching. First, all transmissions are divided up into small chunks (packets) containing both data and routing information. Second, if any node that's supposed to retransmit a packet is down, the packet is redirected to another operational node that completes the transmission.

In Jurassic Park, Jeff Goldblum explains how, despite supposedly careful genetic engineering to prevent dino reproduction, "Life finds a way." On the Internet, packets always find their way. To be sure, we've seen how some nations have managed to temporarily cut off their population's access to the Internet, but even so, citizens have found ways to route around their government's data blockade.

The key to the Internet's fault tolerance is decentralization. There exists no single, central Tron-like Master Control that can be shut down to stop the Internet. Sure, there are hubs of power (like the DNS infrastructure), but even there, the network is highly decentralized, with the master name server table replicated to servers all around the world. Because of this decentralization and replication, it's very hard indeed to shut down the entire Internet.

Back to the future

It's the concept of decentralization that lets us jump back to the future, to bitcoin, and to its potential of becoming something like Skynet.

Bitcoin has had a pretty crazy month. There was the Mt. Gox debacle, where thousands of bitcoin holders lost their virtual shirts when the company imploded. There was Newsweek's claim that it had finally "outed" Satoshi Nakamoto, the pseudonymous creator of bitcoin. And at least three bitcoin currency exchanges were hacked and robbed, or suffered denial of service attacks.

With bitcoin under so much pressure, how could it possibly become as all-powerful and all-reaching as Skynet?

The answer is pretty simple: it's not about bitcoin as a currency. It's about bitcoin as a technology, a highly-distributed, leaderless, jurisdictionless, identityless, nearly anonymous decentralized architecture for managing ownership.


Let's go back to the Internet for a moment. The Internet is not a single monolithic entity. At its most simplistic, it's made up of plumbing (DNS, packets, routing, TCP/IP, http), applications (Facebook, Gmail, SharePoint, WordPress) and content (ZDNet, CNET, Mashable, Wikipedia). If one aspect of the Internet shut down (say Wikipedia couldn't get enough funding — a horrible thought to be fair), other elements that run on the Internet (say Facebook) would continue on, uninterrupted. The Internet is a platform, and ZDNet and Facebook and so forth run on top of that platform.

Bitcoin is quite similar. There's an underlying bitcoin plumbing component, a blockchain, that handles all the management of the bitcoin objects. There are a wide variety of applications using this plumbing, from the bitcoin currency to a plethora of alternative currencies, there's the "mining" industry that uses the bitcoin currency application's rules to generate objects that get stored in the blockchain, and there are exchanges (like Mt. Gox) that act as brokers and bankers of bitcoin value.

Next up: the disturbing potential of the bitcoin platform...

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Topics: Security, Government, Government US, Privacy


David Gewirtz, Distinguished Lecturer at CBS Interactive, is an author, U.S. policy advisor, and computer scientist. He is featured in the History Channel special The President's Book of Secrets and is a member of the National Press Club.

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  • bitcoin and the theory of money and credit seems there is a definite possibility that digital currency could break the plastic card cabal's feast of fees. in a p2p environment we just don't need to pay some outfit to process transactions for us
    the digital currency people have a lot to learn about money though before they can make something work. there are various types of money: commodity, fiduciary, fiat, and credit. to make fiat or credit work you need to power of courts and police from government. for fiduciary you must reliably redeem your notes in specie;

    commodity money has implicit trust: an ounce of gold ..... is what it is .... it is not a promise from someone as is fiduciary money -- or a threat -- as is fiat or credit money.

    i don't see people valuing digital currency as a commodity which seems to be the basis on which the concept is supposed to operate as "bitcoins" or currency units are derived by "mining "

    they have a great idea; it just needs work and I don't see which way they need to go.
    • Except that... much as its proponents deny the fact, Bitcoin is fiat, not commodity. Like official currencies, it has no value, except for spendability. The only real difference is there is no central authority managing it.

      Commodities such as precious metals, grain, comic books, and even corporate stock have value apart from their trading value (that's what intrinsic worth is). Precious metals can be used to make jewelry, decorative objects, or electronic components and are both corrosion resistant and pretty. Grain can be eaten. Comic books can be read. Corporate stock usually confers the privilege of voting in corporate elections and always confers partial ownership of the corporation, to include a share of the profits, if any. A real estate deed confers the privilege of governing the land in question, subject to the ultimate authority of the state (it's really a contract between the landholder and the state). Bitcoin confers nothing except the privilege of trading it, just like a dollar; but the US dollar is managed by the US Government which has an incentive to maintain its value; Bitcoin is managed by nobody on the theory that it will maintain its own value.

      Thus, Bitcoin is fiat, even though it is not established by the laws of any jurisdiction; merely by a protocol devised by an anonymous individual.
      John L. Ries
  • I thought

    Google was building Skynet.................
  • Because we all know Hollywood is real, right?

    "Sounds a lot like Skynet from the Terminator movies, doesn't it?"

    Because we all know Hollywood is real, right?


    Amusing, but the analogy isn't realistic.
    • Yet.

      Science is getting quite close to fusion energy. That's what the sun uses- it has a lot of it, and won't run out for millions of years. If humans create an almost limitless source of energy using the same process, do you think other things might change as well?

      The founder of IBM, Thomas Watson, announced in the 1940s that there would never be a need for more than 5 computers, and the govt. would be the only client likely to buy them...

      How'd that work out?
  • And trying to use DNS as a centralized internet control

    is a false assumption.

    DNS is only centralized as far as people ASSUME it is centralized.

    There can be totally independant DNS trees as desired. (I used to run one for the Navy - I was the DNS root server admin as far as anyone could tell).

    The internet is distributed... Various SERVICES available might be centralized, but that doesn't prevent there from being duplicates.
  • If Bitcoin can be "mined" or hacked, so could Skynet

    Then again, with humanity all but wiped out by Skynet, I doubt that there would be much of a human, cellular or internet structures to access Skynet with.

    We are doomed! So sad.
  • Let's acknowledge one simple truth up front...

    Bitcoin may or may not be a lot of things, but one thing it most definitely is not is a viable currency. There is one single threshold in measuring whether something is a currency or not. Can you buy the necessities of, shelter, water and energy...directly with it. You simply cannot walk down the the grocery, fill up the cart, go up to the cashier and pay with Bitcoins. I can't pay my water bill with Bitcoins. I can't pay my electric bill or pay for gasoline with Bitcoins. I can use Bitcoins to buy other financial instruments that will allow me to do some of these things, but I can't make direct payments with Bitcoins for these kinds of transactions. That means that Bitcoins simply do not meet the definition of a currency. There. Somebody had to say it.
    • JasonP: do your homework
  • Distributed responsibility

    In my mind, this is what REALLY makes bitcoin revolutionary; it is the corollary of distributed & anonymous ownership. Here's a comparison to make the point:

    -- an unknown terrorist uses USD to fund a football stadium attack (C4 combined with anthrax plus crowd stampeding tactics, for instance) which kills 10K+ people. As it turns out, he spent cash to do it, a small part of which I had deposited in the bank a few days earlier, and which he withdrew. Yet, by common agreement on multiple levels, I am not responsible for the attack, since I gave my cash to the bank (central authority), which then gave it (unwittingly) to him/them. Clearly, the responsibility lies with the terrorist cell and their original funding organization.

    -- an unknown terrorist uses virtual currency (bitcoin in this case) to fund the same attack. However, the funding organization is also anonymous, because years before that a large, unknown group of humans funded a DAO (see article above) which began mining currency and preparing for this very attack. In this case, the terrorist cell is still on the hook... but what about the DAO? Who are they? Where are they? How do you prove that they are actually responsible for the 10K+ deaths and resulting mayhem?? Clearly, the govt. would try very hard to track them down, but even if it succeeded, how does it shut down the blockchain?

    By distributing responsibility for various actions, good or bad, among many unknown actors who don't know and don't NEED to know each other, virtual currency itself will take on a kind of life of it's own.

    What happens next? We have no idea...