A Study in Contrasts – Circle, QuickCoin, Armory

Hey all – life’s been crazy with finals and a graduation or two to attend. Glad to finally be back writing about Bitcoin. There’s been some exciting developments lately, but after attending the MIT Bitcoin Expo a few weeks back and learning of the release of a pair of ease of use-focused Bitcoin products (Boston-based Circle‘s product and QuickCoin), I want to speak on a philosophical level in this post.

Both Circle and a Bitcoin startup known as Armory had featured speakers at the MIT Bitcoin Expo. The products of these companies couldn’t be more different. While Armory is by no means difficult to use for most tech-literate people, it seemed to me that Armory placed little or no emphasis on being user-friendly. For example, a paper backup is the only way to back up and retrieve your wallet if you happen to forget a password. One also needs to install and synchronize the full Bitcoin-qt client and run a full node to use Armory online. Armory also has an option for an offline wallet for “cold storage” – possibly the most secure way to hold bitcoins. This requires an offline computer, though, which is simply not something every Bitcoin user is going to have on hand. (Read more about using Armory’s wallet here.)

Armory is still in a beta build, yet there have been no reported hacks or losses of bitcoins due to the software itself. If one loses their paper backup and something happens to the computer (online or offline) on which the wallet is hosted, though, bitcoins can be lost. Using Armory is inconvenient – no two ways about it. Installing and synchronizing Bitcoin-qt takes hours, and even after it’s installed, it can take a few minutes to load. An offline computer just seems completely unnecessary to own for any other purpose besides something like Armory. And paper is annoying. Yet security of a digital currency in a world full of hackers is an issue that may be paramount.

A common thread among the MIT expo speakers, though, was how Bitcoin would be eventually adopted by the masses. Circle co-founder Sean Neville was among the speakers, and raised some excellent points on the topic of Bitcoin adoption. To paraphrase, he more or less said that your everyday person isn’t going to use Bitcoin when an understanding of cryptography, the Block Chain, private/public keys, and other similarly complex ideas is needed. The way I understand it, Neville thinks that Bitcoin needs an app that “translates it into English”, so to speak. Enthusiasts have no trouble using and wrapping their heads around Bitcoin, but that’s simply not enough for the mainstream to adopt cryptocurrency technology.

Circle and QuickCoin, both of which launched early builds of their wallets recently, are focused on adoption and ease of use. Not to say these wallets are not secure – there’s no evidence yet that they are not secure products for the purchase and storage of bitcoins – but when compared to a wallet like Armory’s, one simply can’t make an argument that QuickCoin’s or Circle’s wallet is more secure. Yet both Circle and QuickCoin are drawing rave reviews for their ease of use (and lack of transaction fees, in Circle’s case).

These apps and other similar apps beg the question: What’s more important, security or adoption? A lack of security in a wallet will eventually give way to hackers stealing bitcoins. However, what’s the point of securing your bitcoins if neither none your peers nor your preferred merchants use bitcoins? If I had to choose, I’d side with adoption. The Internet had its issues with security as it grew, but these proved to simply be growing pains as the Internet gradually dominated the world.

Ultimately, security and adoption are likely to go hand in hand. Increased security will help adoption as users begin to view Bitcoin as safer, and a greater network of users will spur the need for greater security. Bitcoin certainly does not have a “killer app” yet that combines security and ease of use, but I believe one or more of these will emerge in the near future (perhaps even in the form of one of the aforementioned wallets). There isn’t only one credit card company in existence, and I don’t believe there will be only one Bitcoin company in the future. However, the companies that are able to harness the best of the seemingly opposite concepts of security and ease of use will be the winners when the dust clears.

You can check out the apps discussed in this article via the links below:

Circle: https://www.circle.com/

QuickCoin: http://www.quickcoin.co/

Armory: https://bitcoinarmory.com/


“Privacy” – An Unfortunate 2013 Buzzword

We’re a full week into 2014, and perhaps the first realization I had of the new year is how more than almost any other technology trend in 2013, we found ourselves talking about privacy. SiliconBeat is one of my preferred technology blogs, and the folks over there post articles with the word “privacy” in the title at what feels like a daily clip sometimes. The ever-growing social media craze as well as an emerging peer-to-peer industry may be the biggest catalysts of our privacy and safety on the internet becoming such a frequent topic of conversation Instead of analyzing it from that angle, I find it best to look to two of the more significant events in 2013 Internet privacy in terms of what we’ll think of first: The Edward Snowden incident and the recent Snapchat security breach.


From Russia with love?

I recall I was spending time abroad in Madrid when Snowden first leaked the government documents. Snowden himself was not what scared us, nor really was it the documents he leaked. What instilled fear was the ideas the documents represented – that our own government was both hiding information from us, and looking at our own hidden information. They were violating our privacy, which was awful, while they also were keeping some information private from us, which was somehow also awful. From an ocean away, it all felt like a strange, knee-jerk heavy controversy. I found myself leaning toward the freedom of information stance at the time – I didn’t particularly care if the government was occasionally snooping around if it meant we were safer (Were we though? I don’t really know and I probably never will), but I wanted to know what was going on.

So I took the anti-privacy stance, correct? On the surface, yes, it seems that way. But then we consider the fact that any sort of email tracking by the government means one of two things – that your Googles and your Yahoos were either completely compliant or completely incompetent. Neither of those scenarios is a particularly good one. Evidence of tech companies complying with the government’s surveillance efforts launched months of speculation and debate. The efforts of one Washington Post reporter to attach names to those tech companies had firms with big data – from Facebook to Google to Microsoft – scrambling and confused. The effects from the Snowden reports on technology companies were significant and wide-ranging, and the report was essentially when privacy became a hot topic. My supposedly anti-privacy stance of letting the government snoop around freely is in many ways a pro-privacy stance for the technology companies. The old saying that “any press is good press” just seems like it can’t possibly apply here – how are these companies able to continue their innovative ways we’ve grown to love if the public is suddenly out for blood? How is Google Glass supposed to be the way of the future like we want it to be when bars are going to ban their use?

Fast forward six months, to an unfortunate development in the “tech companies as completely incompetent rather than completely compliant” narrative: The Snapchat breach. It’s recent enough that we all know the story – right before the end of 2013, anonymous hackers backdoor their way into the Snapchat databases and released the usernames and phone numbers of approximately 4.6 million Snapchat users. Snapchat, love it or hate it, was a 2013 staple. The Verge reported that the hackers sought “to raise the public awareness around [the security breach], and also put public pressure on Snapchat to get this exploit fixed”. Even Snapchat wasn’t safe from the privacy and security debate. If there’s an obvious gap in a widely-used program’s code, it should be fixed. But do the hackers seek to make such a statement if we’re not already talking incessantly about everybody’s privacy and security on the internet? “Security matters as much as user experience does”, the hackers added.

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It seemed an unfortunately appropriate wrap-up to a year where privacy was the word on everyone’s lips. Security and privacy is certainly important – we all find ourselves saying that more than ever after 2013. All I heard about, though, was the supposed privacy issues themselves. Did anything ill occur as a result of the Snapchat hackers? The Snowden documents? It would seem at least that nothing tragic has occurred yet because of these breaches of privacy. Has our government turned on you with the information they may or may not have on you? I’ll be the first to say that I don’t know for sure that nothing bad has happened as a result of 2013’s privacy craze, but I’ll also be the first to say this year as a whole gave me a very paranoid vibe. Did we raise hell about privacy in 2013 because we legitimately thought we were in some kind of danger, or was it because we wanted something to raise hell about? I mean, I have nothing to hide, none of this ever legitimately scared me.

A better question: Why am I talking about it now when we’ve put 2013 behind us? Those who forget even the most recent history are doomed to repeat it, of course, and I simply don’t want to have another year of discussing privacy instead of innovation. I want to know whether Bitcoin is ever going to catch on. I want to know how long it is until I can afford Google Glass. I want to know if the next iPhone will actually bring anything new to the table. I don’t want to know why everyone’s afraid of Snapchat, I want to know if Snapchat’s going to go public, or which 2014 startup is going to be the next Snapchat. Everyone’s got their opinion, and maybe privacy just isn’t as important to me as it should be. Let us just ask, though, before we start raising hell about the same trite privacy questions to the point that we’re wearing tin foil hats: Don’t we want to keep moving forward and innovating more than we want to stymie our innovators with privacy (non) issues?