How hard do you think it would be for the US or Chinese governments to amass the computing power needed to maliciously fork the Bitcoin block chain? You are looking at what, $20 million of ASICs? $30 million? Let's be completely unrealistic and say $100 million.
That is less than a tenth of what the government spent on the NSA's new datacenter in Utah. It's pocket change, barely even a blip on the budget of the US government. It requires a very small commitment of personnel and no fieldwork at all, and no real agreement from any other countries. If we called Bitcoin a money-laundering scam, if we attacked under the guise of evidence gathering (just reversing transactions so criminals won't get paid by our cops), I doubt many countries would object even if their citizens lost money in the process.
That is just with the known, well-documented polynomial time attack on Bitcoin. Given that there is no security proof and little formal analysis of the Bitcoin protocol, and not even the kind of heuristic analysis we rely on for block ciphers and efficient hash functions, I seriously doubt that an attack would even require that much effort.
The original argument was about governments making bitcoin de facto illegal. That's quite different from a deliberate attack.
As said, I agree that bitcoin may be heading for trouble, I just disagree it will happen through legislation.
And more generally I disagree it will happen by a third party deliberately disrupting it (either via legislation, the 51% attack or by other means). For a simple reason: A collapse of bitcoin (for any reason) will inevitably spawn a new, more resilient crypto-currency. The exact opposite of what the attacker was looking to achieve.
Why bother doing that when you can just hack or seize exchanges? If MtGox and the next 20 largest bitcoin exchanges get shut down how much more difficult would using bitcoins be?
That is less than a tenth of what the government spent on the NSA's new datacenter in Utah. It's pocket change, barely even a blip on the budget of the US government. It requires a very small commitment of personnel and no fieldwork at all, and no real agreement from any other countries. If we called Bitcoin a money-laundering scam, if we attacked under the guise of evidence gathering (just reversing transactions so criminals won't get paid by our cops), I doubt many countries would object even if their citizens lost money in the process.
That is just with the known, well-documented polynomial time attack on Bitcoin. Given that there is no security proof and little formal analysis of the Bitcoin protocol, and not even the kind of heuristic analysis we rely on for block ciphers and efficient hash functions, I seriously doubt that an attack would even require that much effort.