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US Begins Regulating BitCoin, Will Apply "Money Laundering" Rules To Virtual Transactions

Tyler Durden's picture





 

Last November, in an act of sheer monetary desperation, the ECB issued an exhaustive, and quite ridiculous, pamphlet titled "Virtual Currency Schemes" in which it mocked and warned about the "ponziness" of such electronic currencies as BitCoin. Why a central bank would stoop so "low" to even acknowledge what no "self-respecting" (sic) PhD-clad economist would even discuss, drunk and slurring, at cocktail parties, remains a mystery to this day. However, that it did so over fears the official artificial currency of the insolvent continent, the EUR, may be becoming even more "ponzi" than the BitCoins the ECB was warning about, was clear to everyone involved who saw right through the cheap propaganda attempt. Feel free to ask any Cypriot if they would now rather have their money in locked up Euros, or in "ponzi" yet freely transferable, unregulated BitCoins.

For the answer, we present the chart showing the price of BitCoin in EUR terms since the issuance of the ECB's paper:

Therein, sadly, lies the rub.

As central banks have been able to manipulate the price of precious metals for decades, using a countless plethora of blatant and not so blatant trading techniques, whether involving "banging the close", abusing the London AM fix, rehypothecating and leasing out claims on gold to short and re-short the underlying, creating paper gold exposure out of thin air with which to suppress deliverable prices, or simply engaging in any other heretofore unknown illegal activity, the parabolic surge in gold and silver has, at least for the time being - and especially since the infamous, and demoralizing May 1, 2011 silver smackdown - lost its mojo.

But while precious metals have been subject to price manipulation by the legacy establishment, even if ultimately the actual physical currency equivalent asset, its "value" naively expressed in some paper currency, may be in the possession of the beholder, to date no price suppression or regulation schemes of virtual currencies existed.

It was thus only a matter of time before the same establishment was forced to make sure that money leaving the traditional M0/M1/M2/M3 would not go into alternative electronic currency venues, but would instead be used to accelerate the velocity of the money used by the legacy, and quite terminal, monetary system.

After all, what if not pushing savers to spend, spend, spend and thus boost the money in circulation, was the fundamental purpose of the recent collapse in faith in savings held with European banks?

So, as we had long expected, the time when the global Keynesian status quo refocused its attention from paper gold and silver prices, to such "virtual" currencies as BitCoin has finally arrived.

The WSJ reports that, "the U.S. is applying money-laundering rules to "virtual currencies," amid growing concern that new forms of cash bought on the Internet are being used to fund illicit activities. The move means that firms that issue or exchange the increasingly popular online cash will now be regulated in a similar manner as traditional money-order providers such as Western Union Co. They would have new bookkeeping requirements and mandatory reporting for transactions of more than $10,000. Moreover, firms that receive legal tender in exchange for online currencies or anyone conducting a transaction on someone else's behalf would be subject to new scrutiny, said proponents of Internet currencies.

And just like that, there goes a major part of the allure of all those virtual currencies such as BitCoin that consumers had turned to, and away from such rapidly devaluing units of exchange as the dollar and euro. Because if there was one medium of exchange that was untouched, unregulated, and unmediated by the US government and other authoritarian, despotic regimes around the insolvent "developed world", it was precisely transactions involving BitCoin.

That is no longer the case, as the bloodhound of the Federal Reserve has now turned its attention toward BitCoin, and will not stop until it crashes both its value to end-users, and its utility, in yet another attempt to force the USD, and other fiat, upon global consumers as the only forms of allowed legal tender.

More from the WSJ:

The rising popularity of virtual currencies, while no more than a drop in the bucket of global liquidity, is being fueled by Internet merchants, as well as users' concerns about privacy, jitters about traditional currencies in Europe and the age-old need to move money for illicit purposes.

 

The arm of the Treasury Department that fights money laundering said Monday that the standard federal banking rules aimed at suspicious dollar transfers also apply to firms that issue or exchange money that isn't linked to any government and exists only online.

Naturally, the actual object of US monetary persecution, is BitCoin:

"We are beyond the stage where this was just funny money and a fun online thing. This is used as a currency," said Nicolas Christin, associate director of Carnegie Mellon University's Information Networking Institute.

 

Bitcoins can be used in a host of legitimate transactions—for example, website Reddit allows users to upgrade services using bitcoins and blog service Wordpress.com's store accepts them as a form of payment. Pizzaforcoins.com also lets bitcoin savers pay for deliveries through Domino's and other pizzerias.

The problem with virtual currencies is that defining what is permitted in a narrow regulatory sense, is impossible, which is why any definition will be as broad as possible: after all what better way to spook users than to make virtually any transaction borderline illegal:

Creating clear-cut rules for virtual currencies is difficult. A FinCen official said that anti-money-laundering rules would apply depending on the "factors and circumstances" of each business. The rules don't apply to individuals who simply use virtual currencies to purchase real or virtual goods.

 

The new guidance "clarifies definitions and expectations to ensure that businesses…are aware of their regulatory responsibilities," said Jennifer Shasky Calvery, FinCen director.

 

The FBI report last year said Bitcoin attracts cybercriminals who want to move or steal funds. "Bitcoin might also logically attract money launderers and other criminals who avoid traditional financial systems by using the Internet to conduct global monetary transfers," the report said. An FBI spokeswoman declined to comment when asked about the agency's concerns regarding virtual currencies.

We were not the only ones to expect imminent intervention from Big Brother:

Some firms say they anticipated the rules. Charlie Sherm, chief executive of bitcoin payment processor BitInstant, said his company is already compliant.

 

Mr. Christin of Carnegie Mellon said that he believes Bitcoin's dominant use right now is speculation.

 

"When you have a commodity or currency whose value has grown as rapidly as Bitcoin it makes sense to hold on to it as a speculative instrument," he said. It also is commonly used for online black markets or gambling sites. "Whether used for money laundering…there is no smoking gun."

As to the question of timing - why now - the answer is simple. Europe. After all, it was only yesterday that we wrote that "In Spain, The Bitcoin Run Has Started." It is self-explanatory that if such an exodus away from legacy currencies and into BitCoin was left unchecked, more and more people would follow suit, which is why it had to be intercepted as early as possible.

The jump in the bitcoin exchange rate this week also coincides with concerns euros could be taken from retail bank accounts in Cyprus to fund a bailout. Internet blogs say speculators are looking toward currency alternatives.

Well, if internet blogs say... Of course, internet blogs also say that if and when the fascination with virtual currencies fizzles, all those who are disgusted with the abuse of fiat will not cease from seeking USD, EUR, JPY, GBP and CHF alternatives, but will merely go back to the safety of having hard assets as a currency, namely silver and gold, instead of electronic ones and zeroes, which the US government, in all its Orwellian benevolence may one day, for lack of a better word, hack right out of existence.

On the other hand, the regime's desperation is reaching such a level that a Executive Order 6102-type confiscation of all hard asset currencies may not be far behind.

Because forewarned, is forearmed.

 


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Thu, 03/21/2013 - 21:26 | Link to Comment Bastiat
Bastiat's picture

 

Surprise, surprise.

Is there any doubt now how deep the fear goes with the fiat lords.

Thu, 03/21/2013 - 21:29 | Link to Comment CMURRAYR
CMURRAYR's picture

Rothbard:

This process: the cumulative development of a medium of exchange on the free market--is the only way money can become established. Money cannot originate in any other way, neither by everyone suddenly deciding to create money out of useless material, nor by government calling bits of paper "money." For embedded in the demand for money is knowledge of the money-prices of the immediate past; in contrast to directly-used consumers' or producers' goods, money must have pre-existing prices on which to ground a demand. But the only way this can happen is by beginning with a useful commodity under barter, and then adding demand for a medium for exchange to the previous demand for direct us

....

A most important truth about money now emerges from our discussion: money is a commodity. Learning this simple lesson is one of the world's most important tasks. So often have people talked about money as something much more or less than this. Money is not an abstract unit of account, divorceable from a concrete good; it is NOT a useless token only good for exchanging; it is not a "claim on society"; it is not a guarantee of a fixed price level. It is simply a commodity. It differs from other commodities in being demanded mainly as a medium of exchange. But aside from this, it is a commodity--and, like all commodities, it has an existing stock, it faces demands by people to buy and hold it, etc.

http://www.mises.org/money/2s3.asp

I'm not stopping anybody from bying bitcoins however. Feel free to do what you want.

Thu, 03/21/2013 - 21:38 | Link to Comment Supernova Born
Supernova Born's picture

That was quick.

Ben says "Bring it on, bitchez!"

Thu, 03/21/2013 - 21:39 | Link to Comment Supernova Born
Supernova Born's picture

Putting "coin" in the name was not smart.

The Coinage Clause and all...

Thu, 03/21/2013 - 21:41 | Link to Comment CH1
Thu, 03/21/2013 - 21:42 | Link to Comment Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

old news

Thu, 03/21/2013 - 21:44 | Link to Comment The Shootist
The Shootist's picture

Bitcoins are for terrorists wth ak47s.

Thu, 03/21/2013 - 21:48 | Link to Comment Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

one of the Tylers is really off base, this is very old news.  Al fucking Gore said he was a fan of bitcoin since then.  

Thu, 03/21/2013 - 21:53 | Link to Comment labestiol
labestiol's picture

Also worth the read, the opinion of a specialized lawyer, board member of the bitcoin foundation : https://bitcoinfoundation.org/blog/?p=152

Thu, 03/21/2013 - 22:48 | Link to Comment redpill
redpill's picture

Old news or not, it shows the jackboot that could crush bitcoin at any time. These assholes are ruthless, and will go after every node.

Thu, 03/21/2013 - 23:02 | Link to Comment labestiol
labestiol's picture

These assholes are ruthless, and will go after every node.

Even the ones in China or Russia ?

People still have troubles understanding what decentralized mean...If governments try to shutdown bitcoin, they'll make fools out of themselves

Thu, 03/21/2013 - 23:03 | Link to Comment imaginalis
imaginalis's picture

When are money laundering laws going to apply to the cheating fucks calling themselves bankers?

Thu, 03/21/2013 - 23:08 | Link to Comment MiguelitoRaton
MiguelitoRaton's picture

"The sheeple are assembled in the pens now it is time to slam the gates shut." - Said every politician everywhere

Fri, 03/22/2013 - 00:02 | Link to Comment labestiol
labestiol's picture

Just thought I would leave that here. A few words written by bitcoin's creator, Satoshi Nakamoto

The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts. Their massive overhead costs make micropayments impossible.

A generation ago, multi-user time-sharing computer systems had a similar problem. Before strong encryption, users had to rely on password protection to secure their files, placing trust in the system administrator to keep their information private. Privacy could always be overridden by the admin based on his judgment call weighing the principle of privacy against other concerns, or at the behest of his superiors. Then strong encryption became available to the masses, and trust was no longer required. Data could be secured in a way that was physically impossible for others to access, no matter for what reason, no matter how good the excuse, no matter what.

It's time we had the same thing for money. With e-currency based on cryptographic proof, without the need to trust a third party middleman, money can be secure and transactions effortless.

 

Yes, [we will not find a solution to political problems in cryptography,] but we can win a major battle in the arms race and gain a new territory of freedom for several years. Governments are good at cutting off the heads of a centrally controlled networks like Napster, but pure P2P networks like Gnutella and Tor seem to be holding their own.

Fri, 03/22/2013 - 01:54 | Link to Comment GeoffreyT
GeoffreyT's picture

Nakamoto O-Sensei knows his shit.

Eventually the iso-perspicacity of Jim Bell's "Assassination Politics" will be similarly recognised.

Fri, 03/22/2013 - 04:07 | Link to Comment AldousHuxley
AldousHuxley's picture

Gold has 7000 year history

US Dollar has US military backing

BitCoin has what?

 

 

 

 

 

Fri, 03/22/2013 - 04:39 | Link to Comment StychoKiller
StychoKiller's picture

Anonymity!

Fri, 03/22/2013 - 05:47 | Link to Comment gold-is-not-dead
gold-is-not-dead's picture

Bitcoin's are backed by math, and that's a bitch for all the haters...

btw... for the true fans, current mania level is at 66/100

Fri, 03/22/2013 - 09:23 | Link to Comment Vendetta
Vendetta's picture

Bitcoin is backed by the alternative dollar and all the monetary abuse, fraud and corruption that is tied to it, pretty solid backing I might add.

Fri, 03/22/2013 - 10:21 | Link to Comment gold-is-not-dead
gold-is-not-dead's picture

Hahahah, true, this is one of the best definitions I have ever heard, kudos man… it's backed by the fact that every government currency in the world is getting inflated pro actively...

Fri, 03/22/2013 - 10:08 | Link to Comment mraptor
mraptor's picture

It will be funny if some bussnesman with some free money comes by and declare he will buy any bitcoin no matter what at ratio 1b:1$ or whatever ... anytime ... or 1 gram of gld..

Not impossible for some rich guy... it is just 21 million they have to cover forever. (OR 8 mln currently)

Bitcoin users can do it themself too..f.e. 1c on transaction from the major exchanges goes towards a fund until it reaches the 21 mln..piece of cacke..

This way it will be certain that even if they crack down there will be some fiat-value to the currency :))

it will be super funny for the economists professors complaining it is not currency to say anything !!

I wonder why nobody has tought about it ?!

It will be even easier when the currencies devalue more.. and about a crackdown it does not have to be one person on one place... you could have escrowed money from 8000 oeople for 1000$ if the price on the exchange hits 1$ this clause kick's in :(

 

Fri, 03/22/2013 - 21:04 | Link to Comment Zuke Kook
Zuke Kook's picture

 

Answer:

  • the most secure electronic transactions that exist, period
  • guaranteed trust
  • guaranteed asymptotic inflation, to a maximum of 21 million BTC created by approximately 2140 (nearly 11 million already exist)
  • guaranteed against debasement
  • guaranteed against transaction cancellation
  • hacking the protocol is almost impossible, i.e. computationally very difficult
  • as much anonymity as the counterparties want
  • as much untraceability as the counterparties want
  • 8 decimal point granularity, which can be expanded further if needed (the only negotiable part of the protocol)
  • completely decentralized and distributed architecture
  • no need for a bank; you can be your own bank!
  • caters to self interest: mining participants are rewarded for their work
  • impossible to destroy without first destroying every computer on earth and/or every piece of internet infrastructure on the planet
  • transactions around the world take only minutes to complete
  • fees are negligible compared to currency alternatives
  • personal responsibility is engrained in the protocol
  • bankers, government and the collective, out; individuals, in

The only con is that Bitcoin may not survive most types of apocalypses, be it a zombie apocalypse, a dinopocalypse, alien invasion/enslavement, a worldwide EMP, full scale thermonuclear holocaust, or an 1859-like solar activity event. So there's that.

Fri, 03/22/2013 - 04:37 | Link to Comment Cadavre
Cadavre's picture

"the U.S. is applying money-laundering rules to "virtual currencies," amid growing concern that new forms of cash bought on the Internet are being used to fund illicit activities. 

What is more virtual than western fiats? Money laundering virtual money seems perfectly acceptable to Holder. Between he an Alberto, it's hard to tell which one has suffered more concussions from stallion flesh hammers slamming their tonsils and snaping their heads - Holder just gave pass to HSBC for admitted laundering of 1 billion in drug cartel (DEA/CIA) money - now Holder (tween sessions of slobber  bobbing for Marc Rich's tuna sauce  nut) is gonna gonna get all puffed estrogen fluffed and girly boy tuff? Really - his plate's pretty full just hacking up lumps from his lil bo peep buns up and kneeling full bore throat throttling the white shoe boys in their noon rut.

Is the FED converting the notional principal (100 Million) underlying swap contracts to real cash when they bail or QE the subsidiary crime families (?) - ain't nothing more notional than the [fake] principal underlying a rate or currency/rate swap.

Saw a Charlie Rose interview with board dumped Greenberg yesterday (Does a mortician do Rose's makeup). It almost looks like AIG was a Goldman hit like every other bank or state collapse. Recalling history - First Glass Steeg gets repealed, using the same unimaginative tedious strategy the WZO's sayan, Chief Justice William Brandies used to blackmail Wilson into entering the US in (an almost done) WWI. Wilson, also was instructed to approve IRS and FED RESERVE ACTS to avoid public discussion of the alleged tuna stains on Wilson's Monica. Then  AIG opens a quant desk and is fortunate to acquire some Quant jocks from Goldman. A 7 Billion Dollar collateral call results. AIG is denied access to the repo window. At least Libya had access to the repo teller's window when Goldman extorted a couple of billion from them. The board boots Greenberg and puts another Goldman alumni in the director's chair, and viola', a 7 Billion buck quick fix fireballs into a 182 Billion buck tsunami. Could not see any tell of turpitude in Greenberg's description - AIG look to be - though no one saying - one of earliest Goldman "hits" (ENRON?) since god's workers went public. Included in Rose's interview were vids of Elliot Spitzer - Spitzer, OTH, giggled and sqeamed with waving docs purported as proof pos Greenberg was up to some nassity stuff - AND THEN - IN MOMENT OF CLARITY - left urs true with sense was Spitzer was part of Goldman's hit team.

Now Cypriots get their deposits MF Globaled? (it worked in the US). Cypriot's central bankster, with Cypriot Politco approval. like Greece and Libya,  make "sure to lose - but sold as winners" side bets with Goldman. As the wagers are confirmed, Goldman follows it's usual practice then shorts a position it sold to a client - then lets the deal steep - waiting for the sure to fail investments to fatten an already bloated GS extortion kitty. Thank god we got ba watchful congress and sec and E Holder protecting us from these guys.

Iceland `em - fuck the EU - let Turkey's leadership (?) has put it's shorts on backwards to join the EU with regards to their sensitivities to the white eyes in the west appetite for a yet another slimey drooley blood rut in (Syria) - shit - just do a nation swap - let Turkey take Cypriots place on the EU roster and let turks get butt fucked by Goldman's and UK Shadow Banks - simple!

CNN HLN has been moon bleating cartoon juries voting their drummed up emotions related a murder trial against Haily Page (?)- I thought she died years ago - reruns(?)

Recommended reading - "The Heaven Makers" and "The Jesus Incident" by Frank Herbert

Fri, 03/22/2013 - 01:16 | Link to Comment U4 eee aaa
U4 eee aaa's picture

They consider themselves money dry cleaners so, in their minds, the rules don't apply

Fri, 03/22/2013 - 07:16 | Link to Comment SilverDOG
SilverDOG's picture

imaginalis,

 

When the drug, weapons, slave traders, etc. end their IMF, Central Bank, FED, etc. money laundering.

Such will expose the ematiated ponzi spine of currencies and zero balance available within the monetary

system. Then "Hang 'Em High"

Far to many "Blue Pill" swallowers currently.

A supposed end of dirty drug money deposits, began the financial bank collapse.

A distractionary WW3 coming to a country near you.

 

Fri, 03/22/2013 - 04:54 | Link to Comment matrix2012
matrix2012's picture

"Even the ones in China or Russia ?"

 

I doubt it very much that bitcoins or any other virtual currency are popular among the Chinese and Russian netizens!!! Both the Chinese and Russian understand and appreciate the value of sound money very well ;)

Fri, 03/22/2013 - 07:55 | Link to Comment awakening
awakening's picture

I guess I dreamed up the entire story about RuCoin and Novacoin =/

Fri, 03/22/2013 - 08:06 | Link to Comment labestiol
labestiol's picture

Well, then you should look at bitcoin on google trends. Russia has been sitting on the top of countries list for a while.

As for Chinese, unfortunately google trends doesn't help, but they probably are the biggest coutry for hashing power (look for Avalon or Asicminer).

Fri, 03/22/2013 - 08:47 | Link to Comment DaddyO
DaddyO's picture

 

matrix2012,

And what sound money are you refering to?

DaddyO

Fri, 03/22/2013 - 10:38 | Link to Comment mraptor
mraptor's picture

Check google trends and you will be surprised :

http://www.google.com/trends/explore#q=bitcoin

Thu, 03/21/2013 - 23:02 | Link to Comment francis_sawyer
francis_sawyer's picture

@redpill

~~~

The part about the operation that BITCOINERS don't understand is the following:

Most seem to be fully immersed in the concept of INDESTRUCTABILITY... When defending bitcoin, I hear the same argument over and over about how IMPOSSIBLE it is either hack the code, or take away everyones 'wallet' & what not...

That's NOT THE FUCKING POINT...

Conventional warfare tactics don't work anymore [in a world that's connected, in an instant, by media]... All you have to do to destroy something is to 'demonize' it [or ~ make people not TRUST it]... Now ~ that being said, that is a conceptual sword that cuts both ways...

Bitcoiners will argue that LOSS OF FAITH in fiat will be the thing that makes everyone rush to bitcoin...

OTOH ~ The very moment that a bunch of people LOSE MONEY with bitcoin [think NASDAQ BUBBLE or any other bubble], TRUST in it will disappear for more than a generation...

I'll lay odds that, even considering the shaky architecture of fiat at the moment... it would be a lot EASIER of a campaign to pull some levers to get people to 'bust out' on bitcoins...

What happened to all the NASDAQ billionaires?

Thu, 03/21/2013 - 23:06 | Link to Comment labestiol
labestiol's picture

People will go away, and then come back. Don't forget bitcoin is recovering from a 93% crash.

 

Fri, 03/22/2013 - 01:08 | Link to Comment fonestar
fonestar's picture

Major LULZ will come from the 31.7 year old libertarian males online when the Fed has to come out and explain why it is bad to use Bitcoin. Or when the sheople come to understand that this supposedly "fake", virtual money buys far more than their "real" money and is steadily gaining in value.  Eventually the 8-bit brain will begin to realise they can merely save in this virtual currency and trade out of it when they need to pay bills, debts, etc....

 

Thu, 03/21/2013 - 23:16 | Link to Comment Matt
Matt's picture

Bitcoin already had a bubble burst in 2011, and will likely do so this year. I think the difference is that, whereas with stocks, fiat money, etc, people have an expectation that it is safe since it is government regulated.

Anyone using bitcoin should be aware that it is the wild west; there is no way to reverse a transaction, no law enforcement or regulators to go to when your money is vaporized.

Thu, 03/21/2013 - 23:34 | Link to Comment Prisoners_dilemna
Prisoners_dilemna's picture

Good comment Matt, but I want to twist your words a bit. "the difference is that...with fiat...people have an expectation that it is safe since it is government regulated.... and then we wake up and realize the govt is the thing to fear most. Where as in the wild west... there are no goons in uniforms acting under colour of law to steal private property. And we deal with criminals in the wild way.  We do have enforcement,  just not the jack booted, tax feeding type of enforcers most people wrongly think are there to protect them.

I'm under no such delusion.

I feel safer in the "wild west".

 

But I feel safer because I follow my own instincts. I have to look out for myself. I trust myself to look out for me much more than I trust any terrocrat and his goons.

2 weeks ago I bought BTC from a guy I looked up on localbitcoins.com. $340 for 7 BTC.  If he cheated me then I learned a hard lesson. But he didnt so I got ahold of him today. Bought 7 more for $540.    I left the money with him and went home.   Again he came through and delivered.   I'm starting to trust the guy.   I might invite him to a BBQ.    I dont need a nanny holding my hand    I'm a big boy.

Fri, 03/22/2013 - 01:50 | Link to Comment Boris Alatovkrap
Boris Alatovkrap's picture

Boris is more feel safe in flooded culvert fighting against large rodent forces for scarcity of food.

Fri, 03/22/2013 - 01:20 | Link to Comment fonestar
fonestar's picture

Nope, I bet everyone of those downloaders in Cyprus, Spain, Italy is showing that app or Bitcoin client to their disenfranchised, demoralized, unemployed and now... robbed buddies and saying "this is really cool!"

I only hope they find a sense of empowerment in it and realise we no longer need the parasitic vermin who have fed off our blood, sweat and tears for centuries!

Fri, 03/22/2013 - 01:17 | Link to Comment fonestar
fonestar's picture

.

Fri, 03/22/2013 - 01:44 | Link to Comment GeoffreyT
GeoffreyT's picture

That's technically correct, Matt, but it's operationally only relevant for 'intra-BitCoin' transfers (i.e., transfers of BTC between one user and another within the BitCoin engine): for merchant payments there is the option of escrow.

For example Silk Road escrows most transactions until it gets feedback from the buyer that the goods have been received. Obviously sellers are therefore the ones who are shouldering delivery risk (a non-trivial risk when some of the products are - ahem - frowned upon by the local overlords).

Fri, 03/22/2013 - 19:53 | Link to Comment Matt
Matt's picture

So, if you use escrow on Silk Road, what government regulator or law enforcement do you go to if Silk Road fails to insure the correct good is delivered, or fails to reverse payment?

Thu, 03/21/2013 - 23:28 | Link to Comment RebelDevil
RebelDevil's picture

We are very lucky that the developers made bitcoin to mimick PMs as a store of value. (even though it is not tangible). Bitcoin cannot die! At worst case scenario, a big sell-off would drop it's price way down, maybe even back to $1, but it could never go to zero. It will gain in value through inflation of the fiat, especially when the 21million limit is reached in mining and the very slow decline of bitcoin supply begins.

Fri, 03/22/2013 - 02:10 | Link to Comment fockewulf190
fockewulf190's picture

"Bitcoin cannot die!"
Actually, I always wondered what happens to Bitcoin if the sun pulls a Mr.Murphy and triggers a Carrington Effect. Of course, not only Bitcoin, but all electronicly stored "cash" would be zapped. All that would be left is paper fiat remnants and phyzz. I'll stick with phyzz.

Fri, 03/22/2013 - 04:19 | Link to Comment RebelDevil
RebelDevil's picture

damn, I knew someone would bring up those solar flares! hahaha XD

Bitcoin will survive anything but that.

Fri, 03/22/2013 - 06:00 | Link to Comment gold-is-not-dead
gold-is-not-dead's picture

it'll survive that as well... just do your backup on optical medium... cd, dvd, what ever...

Fri, 03/22/2013 - 06:10 | Link to Comment negative rates
negative rates's picture

Will this apply to dry powder transaction also?

Fri, 03/22/2013 - 11:11 | Link to Comment I did it by Occident
I did it by Occident's picture

If that were to happen, it might be better to store value in useful things like bullets, alcohol, medicines, whatever.  I'm anti-biotics would be quite valuable in such an event. 

 

 

Fri, 03/22/2013 - 21:32 | Link to Comment Zuke Kook
Zuke Kook's picture

"What happened to all the NASDAQ billionaires?"

During the telecom/internet boom of the 90's, companies printed several trillion dollars' worth of shares. Yes, TRILLIONS (approximately $4.5 trillion was lost by the October, 2002 bottom). Then, unsurprisingly- though not when it was happening, as far as most people were concerned- those shares collapsed in value by over 90%.

Bitcoin's rate of inflation is asymptotic. It is guaranteed and predictable, all the way until approximately 2140 when the maximum 21 million BTC will be in circulation.

The integrity of the protocol has been tested again and again over the past couple of years. There was a Ponzi scheme (Bitcoin Savings and Trust) that netted its creator over $5 million; no transactions were cancelled and no new, additional coins were created in response. Several exchanges collapsed (Bitcoinica and BitFloor); no transactions were cancelled and no new, additional coins were created in response. And the way the protocol is structured, all of the miners would need to accept and facilitate a devaluation of BTC in order for a debasement to be allowed to occur.

THAT is why the currency is so valuable and has increased by nearly 15x over, year-over-year. Well, that and the fact that governments and bankers around the world have been working overtime to either debase, destroy or steal people's personal property due to any number of criminally concocted reasons.

So, what was your comparison between Bitcoin and NASDAQ billionaries about again? Because I still don't understand your point.

Sun, 03/24/2013 - 11:19 | Link to Comment gold-is-not-dead
gold-is-not-dead's picture

hehe, true man... comparing 'nasdaq-web-based-dog-hair-shops-with-previews' with bitcoin protocol is like, ehm, retarded... watch out forthcoming week, several charts look mildly speaking freakish, difficulty raised to 611 petaflops (faster than all supercomputers combined - eat that for derived value!), dividends on rigs dropped by almost 30%, wonder who's gonna dump the btcs now, hehe? Mania level 72/100

Thu, 03/21/2013 - 23:23 | Link to Comment macholatte
macholatte's picture

 

 

It is a paradox that every dictator has climbed to power on the ladder of free speech. Immediately on attaining power each dictator has suppressed all free speech except his own.

Herbert Hoover

 

If you want a vision of the future, imagine a boot stamping on a human face - forever.

George Orwell

 

It is not reasonable that those who gamble with men's lives should not pay with their own.

H. G. Wells

 

Political power grows out of the barrel of a gun.

Mao Zedong

 

Thu, 03/21/2013 - 23:30 | Link to Comment Money Squid
Money Squid's picture

 "I'm the commander -- see, I don't need to explain -- I do not need to explain why I say things. That's the interesting thing about being president."

George W

Thu, 03/21/2013 - 23:26 | Link to Comment macholatte
macholatte's picture

duplicate

 

Thu, 03/21/2013 - 23:33 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

Perfect segue to what a number of I'd have been claiming:

Ultimately, real freedom is obtained and maintained by civic force (pitchforks, guillotines, gallows, guns). A people deserve the Gov they get.

Fri, 03/22/2013 - 22:26 | Link to Comment Cadavre
Cadavre's picture

maintained by civic force (pitchforks, guillotines, gallows, guns)

Ethics, fairness and creativity are not functions of words in a book of rules - they are natural traits. Hardwired core survival. Those traits are not limited to only the human condition but almost all the critters on this rock putting effort into sustaining themselves to assure a healthy legacy for their survivors.

Real capitalism would not seek to destroy the competition. Real capitalism benefits by allowing competition. Without competition  there would be no competitive benchmarks to aim for. Wealth creation is snake oil for low iodine dominion heretics. Wealth is a measure of tokens exchanged for value. All the wealth that ever was and will ever be is fixed. Wealth is the time we have after a healthy days work in the field to light a candle and read to the laughter of our children (you writing this down, right?).

Doing broom and shovel gigs for oligarchs that pilfered every drop of value from the commons and denied the commons access to their craft create value, is not work. It's slavery,  Consumer is another name for slave.

The notion of an all powerful alpha male in any social organization is bullshit. So called alpha males are probably the most detached, fearful  and "weak" members of the troop. The troop spots those weaknesses early and the pampers and nurtures the alpha. Most of the alleged alpha males children are the result of his "harem" screwing sneaky little clever males when he ain't watching. In fact, an alpha spends most of his time, setting aside his first claim to the food trough the allowed by the troop so he'll bulk up, looking for his sneaky harem stock hiding in the bushes fucking the sneaky little cleaver apes that fathered his children. The reason the troop cultivates the alpha, and allows the alpha to satisfy his "might makes right" vanities and tensile sense of invincibility is for the odd chance the troop is confronted with a pack of predators. When that happens, Mr Invincible Alpha, divinely confident in his false sense of invincibility, cultivated by by a lifetime of so called less dominate members of the troop conditioning him to believe the vain notions of dominion the troop spotted when he was young, pounds his chest and, like a fool, takes on the attacking predators, as the rest of the "less dominants" in the troop escape. The alpha's gluttonous bulk, allowed by the troop fostered by the troop when his youthful predilection and weakness were apparent, serves only to delay any threat of the predatory pack cause it takes more time to eat his mass of pampered flesh.

Humanity's problem began (most religious people will confess they are really agnostic and agree that "god" in in the heart) when the notion that some all powerful unmeasurable divine deity is the force behind the magic of existence, and furthermore, a nobility of theologians is both gatekeeper and intermediary to said "magic". It's easy to turn a fear, like the fear of being eaten (that can be strategically avoided), into a fear of the more or less natural death (totally unavoidable). The gods of so called pagan cultures were metaphors to pass the traditions of ethics, creativity and care to future generations.

Forget any search for motive, Psychopathic behavior has no motive, It is an overwhelming and organic fear of everything.

THEN - someone came up with an alpha male notion of a supreme deity (pre hebrew zionism was a notion of an eternal battle between the forces of light and the forces of darkness) and we been in a world of shit ever since. Millions of fundamental christians go to church and sanction with prayer the genocide of Islam's children because the death facilitator at the pulpit before they hit the MSG trays at Luby's, directs them to beleiv that a word for God, Allah, the not the word christians and jews ascribe to Abraham's god.

Allah is the same god christians and jews "believe in": a god, we are told, of an Iraqi named Abraham. SO GET OVER IT!

All the players in De Milles dated epic propaganda flabbergast, "The Ten Commandments", if one accepts the anthropological record, should be African - but that wouldn't go over to well with white middle class Americans on Easter Eve's explosion of TV commercials.

Church services urs tru [had] to attend at the Presbyterian building down the hill so my parents could have Sunday morning "kinky time" without interference from the nestling's, would sometime offer chorals with phrases attributed to a radical egyptian Rabbi designated Jesus. One choral response was "I am the king of kings". Can't recall the minister ever explicitly arguing that the Jesus person was anything divine. In fact the implication was that the quote attributed to the Jesus guy as a claim of divinity, was, in fact, an empowering mantra, like Dune's Maud Dibs recital, under duress and prospect of death, from the "gom jabbar" when the reverend mother tested his "humanity".

"I am the king of kings" is nothing more that a way of saying the king, or a government, is "my" servant, and not boss hog of aeverything. That "truth" has been lost or dulled by over indulgence in Wal Mart iBling, dominion heretics and the snake oil barkers sham wowing the ludicrous notion of the "wealth creation" pig in a poke lame stream slings like monkeys throwing turds at spectators outside the cage.

Couple of summers ago, urs true was mustering up to do lawn work. A Mockingbird (real, not the CIA/Lamestream "Project Mockingbird"), who, for all intensive purposes is our households landlord, was doing what she always did, preparing that season's crop of nestling's for fledging. Her pups couldn't fly - Mocking bird pups look like pine cones - anyways, her pups are flitting about on the the lawn when a cat slinks into the backyard. Moma bird bitches at me to do something about it. I get up, an shoo the interloping feline over the fence. `Bout ten minutes later, Moma bird lands on the patio patio table where I am sitting thinking "why me?" and muster my facilities do execute my chores, and drops a fat juicy wiggly worm on the table, then flies back to her perch to watch her pups, I can only assume the worm was a "thank you" gift for helping out with the cat. Not wanting to be impolite,urs true picks up the worm and drops it someplace out of site.

It is amazing how the natural order of things is connected.

For your notebook: Politicians are not leaders, they are servants (owned/employed) by the commons. Government is not a leadership structure, it is a management structure filled by "public servants", in the employ of the commons, for the express purpose of maintaining the infrastructure and "factually" important institutions of the commons. We are self governing. We are not "governed". We "govern", period. We are the king of kings - every woman is a queen bee - so why the fuck do we believe a single queen hive is a model humanities principals of self governance?

The commons did not create government to enforce the edicts of some bullshit clan of dominion heresy priests pitching salvation for the manufactured fears implanted by corrupt artificial institutions as fodder for campaigns of genocide. The commons created government to maintain the commons assets and repair potholes in roads the commons requires to convert value to wealth so they can get laid on Saturday night. Simple.

How it got like this is not important. How to undo is the question. Delany's "Triton" offers a social organization structure that allows zones of "anarchy" or unregulated contracts that are not allowed beyond the boundaries of the "zone". One can visit the "zones of anarchy", and engage in extra-legal agreements - the "zones" have their own currency and enforcement institutions and are not allowed to leach out into, or transfer property of the commons into tthe "zones" Great place for girlie boys that like killing or dominion heresies to be contained.

And that's why I don't do two shows a night. I just don't.

 

Thu, 03/21/2013 - 22:47 | Link to Comment ebworthen
ebworthen's picture

May not be old news to Spaniards, Cypriots, and other Europeans trying to protect their money from the bankers.

Fri, 03/22/2013 - 03:17 | Link to Comment e-recep
e-recep's picture

so why did this article appear right after spaniards made a move towards bitcoins then?

 

Thu, 03/21/2013 - 22:44 | Link to Comment ebworthen
ebworthen's picture

Those damn AK-47's jumped from $600 to $1,200; but if you get one with a couple of 30 round clips it will be worth $2,000 before long.  Any wonder you can't find firearms to buy?  An alternative store of value (bitchez!).

No doubt the final stages of central bank desperation and despotism will be outlaw of anything but revolvers and shotguns of 8 or fewer rounds; no ownership of anything above .38 caliber, and the sale of Precious Metals worth more than $100 reportable for the I.R.S. and taxable at 25%.

They will go after the dealers, the business people, who have to keep records and file tax returns first.  Then, they will shut down the movement of any assets such as PM's outside the borders of the U.S.  Then, they will get rid of paper/coin currency to kill private transactions.

They almost have the younger generations trapped in the Matrix psychologically, and when there are a multitude of young believers and/or dependents they will make their move to lock the society up.

Killing BitCoin is just the first step.  The confiscation of money in savings by the ECB and the IMF - which they obviously feel no remorse in stealing - was the shot across the bow.  Your money is not your money - it is theirs - they are in control and will do anything to remain in control and continue their despotic march toward 21st century feudalism.

Tyler's:  props, accolades, and applause for this sentence from the article:

"Because if there was one medium of exchange that was untouched, unregulated, and unmediated by the US government and other authoritarian, despotic regimes around the insolvent "developed world", it was precisely transactions involving BitCoin."

Thu, 03/21/2013 - 23:26 | Link to Comment Money Squid
Money Squid's picture

who paid 600 for an AK? They were laying around for 250 to 300 for a long time.

Thu, 03/21/2013 - 23:33 | Link to Comment ebworthen
ebworthen's picture

I'm talking 6 months ago online.  Black market or a gun show is another thing.

Please, tell me where I can buy an AK-47 with two 30 round clips for $250-300 or even $600 today.

I know, I should have bought sooner, shame on me - but now that the hysteria has started - wherefore art reasonable prices and supply?

At least fundamentals still apply in the market of tangibles.

Fri, 03/22/2013 - 11:33 | Link to Comment MachoMan
MachoMan's picture

First, please don't refer to magazines as clips...

Second, you can start getting AKs in the $600 range recently...  check out slickguns.  The best deal since they started popping up again has been the SLR101...  $1k for an AK is pretty obnoxious, but it's milled and effectively produced in Bulgaria. 

Third, overall, tensions are easing on the gun market...  more and more magazines are hitting the shelves at ever decreasing prices...  more and more AR and AK deals...  more ammo is hitting the market and at cheaper prices...  plenty of recent 7.62x39 deals @ $5-6/box.  xm855 is still ridiculously priced, but it will come down too.

Fourth, then, once the tide turns and we figure out nothing is getting banned and the speculators decide to cut their losses, the market will get flooded with the previously pulled forward demand.  Same thing happened last time... 

Thu, 03/21/2013 - 23:30 | Link to Comment gdogus erectus
gdogus erectus's picture

It appears that they may be going after the local bullion dealers already. Here in the CA bay area every small dealer has been systematically robbed by armed thugs after never having a problem for decades. It smells of strong arm to get them to quit. Which several have.

Thu, 03/21/2013 - 23:41 | Link to Comment ebworthen
ebworthen's picture

No doubt.

If I had money to invest and the knowledge and believed that there were 10 years left of no Federal shut-down imminent of PM and firearm dealers I'd open a combo shop; firearms and PM's, each employee with a concealed carry permit and armed to the teeth.

If I ran a PM dealership I'd at least get concealed carry and have someone in the back room with a .223 to take out any thugs; but the Po-Po's and lawyers would probably make that a legal non-starter (which is all a part of the Ponzi).

Fri, 03/22/2013 - 05:55 | Link to Comment GCT
GCT's picture

Investing in firearms is actually something I do as well EB.  I now think the prices will settle as the AWB is not going ot the senate.  But you never know. 

Fri, 03/22/2013 - 02:14 | Link to Comment dark pools of soros
dark pools of soros's picture

I thought they were used by black crack addicts that rape your daughters

Thu, 03/21/2013 - 21:45 | Link to Comment krispkritter
krispkritter's picture

They'll try and regulate everything until they cannot regulate anything...stupid(evil) fuckers...

I love this one: http://www.billstclair.com/DoingFreedom/000623/df.0600.fa.lipidleggin.ht...

Thu, 03/21/2013 - 22:12 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

the move to regulate btc levels the field with feds regulating/monitoring sell/purchases of pm. trades w/ pm and/or btc will now go underground and each individual will need to decide what is more valuable - transacting w/ gold and/or btc

Thu, 03/21/2013 - 23:22 | Link to Comment Matt
Matt's picture

The regulations only apply if you are exchanging over (article says $10,000 but definitions on FinCEN website says $1000) within a day as a currency exchanger, or if you are transmitting. i.e. someone pays you money (USD, etc) to "wire" some BTC to a specific address.

Workaround for money transmitter: Bet on Satoshi Dice and have your winnings come to a different address. Use a new unique address for each bet and win. Result: possibly untraceable way to send money to anyone in the world.

Fri, 03/22/2013 - 03:10 | Link to Comment Tall Tom
Tall Tom's picture

krispkritter...Your link was a good story. Thank you. 

 

I will repeat it so that you all don't have to scroll up...

 

 http://www.billstclair.com/DoingFreedom/000623/df.0600.fa.lipidleggin.ht...

Thu, 03/21/2013 - 21:42 | Link to Comment francis_sawyer
francis_sawyer's picture

.......aaaaaand it's GONE!

Thu, 03/21/2013 - 22:29 | Link to Comment Peachfuzz
Peachfuzz's picture

No kidding. Anybody else notice the gold holdings chart in that link looks like a classic double top bubble that burst in 1950ish? That matches very well with Sprotts #'s from the other day.

Fri, 03/22/2013 - 00:29 | Link to Comment slightlyskeptical
slightlyskeptical's picture

Is it any wonder since gold has gone up at twice the rate of inflation over the last 100 years?

Fair price about $800, but it will likely overshoot on the downside as well, so $575 low is my guess on teh next cycle.

Fri, 03/22/2013 - 03:20 | Link to Comment SilverIsKing
SilverIsKing's picture

Rate of inflation? Which one? The real one or the one your nanny told you about?

Thu, 03/21/2013 - 21:43 | Link to Comment CH1
CH1's picture

Read about it here.

"Users, and Bitcoin miners seem to be exempt from regulation for the moment."

(Sorry for the accidental duplicate.)

Fri, 03/22/2013 - 11:28 | Link to Comment HardAssets
HardAssets's picture

It doesnt matter what they call it - - - anything that threatens the Ponzi will be attacked.

 

Thu, 03/21/2013 - 22:15 | Link to Comment Go Tribe
Go Tribe's picture

I hate our government and governments worldwide.

Thu, 03/21/2013 - 22:19 | Link to Comment TrustbutVerify
TrustbutVerify's picture

Is this hatred a recent occurance or did it start, way back, 50 or 60 years ago when the debt super cycle started.  

Thu, 03/21/2013 - 23:25 | Link to Comment Go Tribe
Go Tribe's picture

Wish I was aware of a debt supercycle decades ago. No, my disgust for central governments is fairly recent.

Fri, 03/22/2013 - 00:19 | Link to Comment Kirk2NCC1701
Kirk2NCC1701's picture

Seeing that TPTB are going after the very things Simon Black talks about (offshore accounts, BTC) kinda smokes out the Gov trolls for me. No wonder their attacks were so... rabid and personal: Their job was to disseminate FUD (Fear, Uncertainty, Doubt), to slow the momentum.

In 10 days I shall be drinking Chilean wine at the sold out offshore event and meeting with tons of other people with brains, balls and means, and these annoying weasels won't be there. While I may feel sorry for the poor, and pity the dumb, I have no time for the Wilfully Dumb. Fuck you, you wankers!

Fri, 03/22/2013 - 01:51 | Link to Comment GeoffreyT
GeoffreyT's picture

Gold.

NB: the Chilean wine I've had recently has been pretty awful - and I say this as someone who will drink the fuck out of ANYTHING with alc/vol > 12%. Had a Chilean Sauv Blanc that tasted like unwooded Chardonnay: made me wish that the winemaker had a visit from Pinochet's Little Helpers (too soon?).

Fri, 03/22/2013 - 07:19 | Link to Comment Ace Ventura
Ace Ventura's picture

Had the opposite experience with Chilean red. Not top shelf stuff mind you, but well worth the bargain price. Then again, perhaps my palate is not that discriminating, as I happen to like Shiraz as well, and several supposed 'experts' tell me Shiraz is the Yugo of red wines.

P.S. Fuck you porcine metastasizing parasitic blood-sucking slime-dwelling asshat bankster vermin. Fuck you and your simpering degenerate treasonous scum-slurping hellspawn puppets in government. Fuck you all very much.

Thu, 03/21/2013 - 21:58 | Link to Comment JR
JR's picture

You can’t force people down in the mud and make them like it. They will kill you, believe me.

And if they should like it, you don’t have a country.

Thu, 03/21/2013 - 22:06 | Link to Comment SpykerSpeed
SpykerSpeed's picture

Appeal to Authority.

Rothbard was mistaken that the regression theorem was prescriptive, when it was actually only intended to be DEscriptive of how certain commodities became money.

Bitcoin is currently being used as money.  Therefore it overrides this interpretation of the regression theorem.  Bitcoin.  Is.  Money.

Thu, 03/21/2013 - 23:03 | Link to Comment LM
LM's picture

Do some googling into why Bitcoin doesn't necessarily violates the prescriptive version of the regression theorem. 

Thu, 03/21/2013 - 23:43 | Link to Comment hmmtellmemore
hmmtellmemore's picture

"Money cannot originate in any other way, neither by everyone suddenly deciding to create money out of useless material... blah blah blah  Rothbard blah blah blah"

Hi, bitcoin isn't money, it is a currency. 

 

Maybe when the redneck half of Zerohedge realizes how difficult it is to transfer money (gold, silver) without a virtual (hence, harder to regulate) currency across the globe, they will realize how great bitcoin is as a tool.  

Fri, 03/22/2013 - 02:20 | Link to Comment dark pools of soros
dark pools of soros's picture

But but all their gold is gone in that there boating accident!

Fri, 03/22/2013 - 12:08 | Link to Comment Thisson
Thisson's picture

Gold is money.  Silver is not money.  Silver is a money substitute.  BTC is not money either.  It's a form of non-counterfeitable scrip.

Fri, 03/22/2013 - 00:04 | Link to Comment Mind Architect
Mind Architect's picture

You forgot to bold this part: the cumulative development of a medium of exchange on the free market--is the only way money can become established. Which is exactly what bitcoin has done. You also misinterpreted what bitcoin is, a currency, not a money.

Fri, 03/22/2013 - 02:12 | Link to Comment RevCBH
RevCBH's picture

Bitcoin does provide a concrete good, albeit a non-physical one. It allows distributed consensus systems, which it turns out can be quite valuable and useful outside of the context of currency.

 

See here for a good writeup: http://paulbohm.com/articles/bitcoins-value-is-decentralization/

Fri, 03/22/2013 - 05:25 | Link to Comment Skin666
Skin666's picture

"This process: the cumulative development of a medium of exchange on the free market--is the only way money can become established"

Bitcoin was created by the market.

Even a visionary like Rothbard could not have predicted the rise of the internet.

I'm a precious metals man myself, but I have also put some money in Bitcoin as an additional hedge for when the fiat monster collapses under its own weight.

Only gold/silver is money, but Bitcoin is a fantastic idea and an online alternative to bankster and government funny currencies

Thu, 03/21/2013 - 21:30 | Link to Comment prains
prains's picture

But when you control the off switch to the lights you also control bitcoin, nes pas?

Thu, 03/21/2013 - 21:44 | Link to Comment CH1
CH1's picture

To stop Bitcoin, you have to turn off everyone's lights, everywhere.

LEARN.

Thu, 03/21/2013 - 21:48 | Link to Comment prains
prains's picture

Wow CH!

 

did you get to the third knuckle on that one? you might need a kleenex

Thu, 03/21/2013 - 22:00 | Link to Comment CH1
CH1's picture

I have no idea what that means.

Guess you have to be a little demented.

Thu, 03/21/2013 - 22:02 | Link to Comment prains
prains's picture

It means you've stated the obvious so clearly you might have a touch of the r'tard, not that that's a bad thing

Thu, 03/21/2013 - 22:14 | Link to Comment prains
prains's picture

Yes I know that was not kool, my apologies

 

but really don't you think that if bitcoin becomes such a threat to TPTB that they wouldn't shut off all the lights?

 

my snarc was general and not specific to you CH, you just stepped on the mine that's all

Thu, 03/21/2013 - 22:34 | Link to Comment labestiol
labestiol's picture

but really don't you think that if bitcoin becomes such a threat to TPTB that they wouldn't shut off all the lights?

That's a rethorical question, n'est-ce pas ?

Thu, 03/21/2013 - 23:31 | Link to Comment Matt
Matt's picture

"but really don't you think that if bitcoin becomes such a threat to TPTB that they wouldn't shut off all the lights?"

They would have to not only turn off the Internet and the power grid, they would also have to prevent people from generating electricity and sending transmissions by any means, including speech or paper. The current limitation of bitcoin seems to be that regional isolation would cause split blockchains. Hopefully they resolve that.

Fri, 03/22/2013 - 01:19 | Link to Comment Lore
Lore's picture

Re: "Hopefully they resolve [regional isolation causing split blockchains]."

Peg a supply of gold to the supply of Bitcoins?  The Chinese and others appear to be gearing for something along those lines.  Call it 'RenCoin' or whatever suits you.

I wouldn't want to hold shares in a central bank these days.  One way or another, the future lies in a free, distributed monetary network.

Fri, 03/22/2013 - 08:37 | Link to Comment CH1
CH1's picture

my snarc was general and not specific to you CH...

Accepted, my friend.

Peace.

Thu, 03/21/2013 - 21:49 | Link to Comment fonzannoon
fonzannoon's picture

who said stop? they said "regulate' whatever that will mean....

Thu, 03/21/2013 - 23:32 | Link to Comment Matt
Matt's picture

Next up, Goldman Sachs opens a BTC exchange and Western Union enables BTC transfers.

Thu, 03/21/2013 - 23:35 | Link to Comment nope-1004
nope-1004's picture

It means manipulated to keep USD as world reserve currency.  Look at how gold and silver have been managed over the last 3 years.  The govvy is all-in now, no turning back.  They'll manipulate and control until the end, otherwise absolute power is lost.

 

Thu, 03/21/2013 - 22:06 | Link to Comment GrinandBearit
GrinandBearit's picture

US gov regulated it... bitcoin basically just got shut down.  Accept it and move on.

Fri, 03/22/2013 - 00:38 | Link to Comment EscapeKey
EscapeKey's picture

Wow, another bitcoin expert.

Fri, 03/22/2013 - 03:37 | Link to Comment Tall Tom
Tall Tom's picture

Laws only serve to pprovide penalties for those caught violating them.

 

Have you ever heard of Tor? Have you ever heard of Anonymous Surfing?

 

Let's suppose that a criminal enterprise wants to wash their money and deposits heavily into BitCoin. After the transaction is finished there is another user, also anonymous, who will trade Currency for BitCoins. The transaction is made using the encoded Servers and there is no way of tracing the transaction.

 

Just what good is the regulations or Laws if they are unenforceable? Check out Tor.

 

LMFAOAROTFL The Law is unenforceable. So...Why don't you accept it...AND MOVE ON?

Fri, 03/22/2013 - 08:21 | Link to Comment awakening
awakening's picture

While the US Gov would like to believe their laws are global and universal, I shall remind you that such beliefs are greatly misplaced (hence the need for so many US Bases internationally with the ultimate goal to create such an illusion via acceptance of the USD).

Spread so thin, the US will (no longer tragically) fall the same way as Rome.

Fri, 03/22/2013 - 09:46 | Link to Comment Its the Vatican...
Its the Vatican Stupid's picture

Rome is still here, BTW. Hiding in plain sight. And spread nice and thick, thank you very much. AMEN.

Thu, 03/21/2013 - 22:44 | Link to Comment XitSam
XitSam's picture

You don't understand yet. They are OK with turning off everyone's lights. By so doing, they would achieve the total control they crave. It is always about control.

Fri, 03/22/2013 - 08:37 | Link to Comment Long_Xau
Long_Xau's picture

They would be shooting themselves in the feet because they are the ones most dependent on and even owning much of the electricity infrastructure. Think of it - they need to keep military industry, banks, bureaucracy and many of their households supplied and they need basically the WHOLE GRID intact (worsening economies of scale due to the same grid being supported by fewer consumers), because if they leave a town out it basically secedes that moment and creates another competitor for them. Same thing with individuals. Might exacerbate our need to find independent power sources, but we have to be doing it anyway.

Thu, 03/21/2013 - 23:45 | Link to Comment hmmtellmemore
hmmtellmemore's picture

"To stop Bitcoin, you have to turn off everyone's lights, everywhere."

 

And you'd need to wipe our hard drives, and destroy our backups.

Fri, 03/22/2013 - 03:24 | Link to Comment e-recep
e-recep's picture

actually it's not about electricty or the internet. to stop bitcoin all they have to do is to kill the faith in it. if you publicly equalize bitcoin holders with money launderers, terrrorists and drug dealers using MSM, people will refrain from it. and that's exactly what they are doing now.

Fri, 03/22/2013 - 03:45 | Link to Comment Tall Tom
Tall Tom's picture

Oh...You mean like how they are equating the people who use Gold and Silver, respect the Constitution, and reject Socialism as Terrorists? You mean like those people who have lost Trust and Confidence in the Currency?

 

Actually they may have stymied the growth of BitCoin. But the people who are currently using it will not be dissuaded by the MSM Propaganda.

 

So I will not be on record as one of those who equalize BitCoin users as terrorists. I have learned to reject anything that the MSM states as truth. Because I know that generally it is a far fetched fiction which they are selling.

 

I have lost confidence in them. Haven't you yet?

Thu, 03/21/2013 - 21:52 | Link to Comment wintermute
wintermute's picture

The problem the Feds face is that Bitcoin is truly international. Are the Federal Reserve jackboot minions going to storm server farms in Russia?, China?, Australia? Germany?

Thu, 03/21/2013 - 22:30 | Link to Comment Pseudo Anonym
Pseudo Anonym's picture

not yet.  but the btc can be perceived as a threat to all fiat money backed by nothing; thus one may expect the other cb's to follow;

Thu, 03/21/2013 - 22:47 | Link to Comment ForTheWorld
ForTheWorld's picture

Just look at what happened to Kim DotCom. The US believes they can shut down whatever they want, whenever they want, if they don't like it. It boggles my mind.

Fri, 03/22/2013 - 08:26 | Link to Comment awakening
awakening's picture

Unfortunately my patriotism is too severely lacking to believe Australia wouldn't cave to their wishes, not through deliberate and malicious means but from far simpler means of a mere phone call to handlers/puppeteers of whatever Prime Minister (still Gillard not that it means anything compared to events around here) happens to be in power at the time of request.

Thu, 03/21/2013 - 21:36 | Link to Comment HulkHogan
HulkHogan's picture

I told you fuckers this yesterday. All you stupid Bit-bugs.

Thu, 03/21/2013 - 21:50 | Link to Comment Mine Is Bigger
Mine Is Bigger's picture

I put a small amount that I coud bear losing into bitcoin about two years ago.  I didn't and still don't care about anonymity.  I liked the part where the supply of bitcoin could not be increased willy-nilly.  If bitcoin is going to be regulated just like Western Union, it may even become mainstream and its value could actually increase.  I am cruious what others think.

Thu, 03/21/2013 - 21:50 | Link to Comment Half_A_Billion_...
Half_A_Billion_Hollow_Points's picture

the price rallied after this news.  It came out and it was something like $57, now it's around $70, which imo is looking bubbly

Thu, 03/21/2013 - 21:55 | Link to Comment Mine Is Bigger
Mine Is Bigger's picture

Thanks for the info.  I did not know that.  It certainly looks bubbly.  But long term, this development could actually be good news for people to whom anonymity is not that important.

Thu, 03/21/2013 - 21:56 | Link to Comment francis_sawyer
francis_sawyer's picture

Kind of like owning JDS Uniphase back in the day I guess... Nowadays ~ you can buy a "Gordita" from the the dollar menu at Taco Bell with a share...

Fri, 03/22/2013 - 00:20 | Link to Comment dtwn
dtwn's picture

Best thing to do to increase interest in something is to regulate it.  Also see Prohibition, Drug War.

Fri, 03/22/2013 - 00:40 | Link to Comment EscapeKey
EscapeKey's picture

I predict an imminent increase in AMD GPU sales.

Fri, 03/22/2013 - 08:27 | Link to Comment awakening
awakening's picture

It's all ASICs now, the days of AMD GPU mining have ended.

Thu, 03/21/2013 - 21:52 | Link to Comment Diablo
Diablo's picture

Amount of bitcoins (1 year chart): https://blockchain.info/charts/total-bitcoins

Market Cap (1 year): https://blockchain.info/charts/market-cap

Yup, seems legit.  LOL

 

Thu, 03/21/2013 - 22:02 | Link to Comment BeaverFever
BeaverFever's picture

Looks like Max Keiser's scam is going down the tubes. I'm sure that he will still make tens of millions by duping people before the crash.

Thu, 03/21/2013 - 23:25 | Link to Comment Diablo
Diablo's picture

Agree 1000%. 

First he was scamming suckers into silver, talking about 'buy silver, crash JPMorgan', next he went into BitCoins. 

 

Fri, 03/22/2013 - 04:01 | Link to Comment Tall Tom
Tall Tom's picture

I buy Silver everytime the oportunity presents itself. I buy Gold too. I will be happy to see the suckers bail out of the Fiat dollar which is destined to end up upon the trash heap of History.

 

Suckers are ones who buy into assets which are planned to lose value, rather than gain value, over the years.

 

With a Targeted 2% Inflation Rate it is actually planned that the Dollar will be worth only One Half of its value today in 35 Years.

 

Because of the Planned Loss in value of the US Dollar it is only Suckers who invest in those. And with the overwhelming World Wide Demand for Dollars I must write that PT Barnum was wrong.

 

PT Barnum was reported to have said that there is a Sucker Born every Minute. He was sadly mistaken. Suckers are born continuously and there are some suckers right now who I am responding to on this Comment Board.

 

Suckers are those who invest in US Dollars. People whom are invested into Silver will realize that their wealth remains intact through the Hyperinlationary Destruction of the US Dollar.

 

Yeah...Keep those Interest rates low.

Thu, 03/21/2013 - 22:08 | Link to Comment e1618978
e1618978's picture

You need to research how it works more before you jump to that conclusion.

Thu, 03/21/2013 - 23:35 | Link to Comment Matt
Matt's picture

The sudden increase from mid-January is ridiculous, no matter how much you research. That is a straight up hockey-stick formation, and the graph has 0 as the lower-bound and increases in a linear manner.

Thu, 03/21/2013 - 21:55 | Link to Comment HulkHogan
HulkHogan's picture

It will be regulated, then you'll need to pay taxes on it. You'll need to report everything you bought with it, the appreciation of the bits, capital gains, dividends, energy consumption, or whatever else .gov wants to add on to shut it down. And they'll do same with gold and silver when it finally spikes.

Thu, 03/21/2013 - 22:02 | Link to Comment Mine Is Bigger
Mine Is Bigger's picture

Thanks for your feedback.  I guess someone should set up a bitcoin-based anonymous political funds donation scheme.  Then, they may back offk.

Thu, 03/21/2013 - 22:06 | Link to Comment HulkHogan
HulkHogan's picture

Now that is a good idea. And it could work. If a bunch of Bit-bugs gave coins to a popular and heavy favorite, it may turn out alright for you guys.

Thu, 03/21/2013 - 23:43 | Link to Comment seek
seek's picture

You already need to pay taxes (it's capital gains, after all) if you convert to USD. There's no change there.

Most exchanges were already operating under the FINCEN rules, even if bitcoin wasn't formally subject to it, so this is a non-event.

A key issue for the government in tracability, which is very, very weak with bitcoin, and can be made non-existant. So enforcement becomes a challenge. No doubt when the time comes the gov't will claim everything, bitcoin, gold, silver, the sun the stars -- as its own, but just like in the depression their ability to actually call things in will be severely limited.

Fri, 03/22/2013 - 00:43 | Link to Comment EscapeKey
EscapeKey's picture

I guess you just argued why btc is better than gold or silver, then. Good luck proving individual x is the owner of wallet y (unless x doesn't know what s/he is doing).

Thu, 03/21/2013 - 22:04 | Link to Comment slightlyskeptical
slightlyskeptical's picture

i don't believe the supply stays the same. Don't they split it up into more fractions with every new "investor"? Thus dilution is built in.

Thu, 03/21/2013 - 22:08 | Link to Comment Mine Is Bigger
Mine Is Bigger's picture

I think the supply continues to increase, but it follows a predetermined pattern.  What I meant was the supply is not supposed to shoot up just because somene decides to print like crazy.

Thu, 03/21/2013 - 22:28 | Link to Comment labestiol
Thu, 03/21/2013 - 21:52 | Link to Comment BandGap
BandGap's picture

I own a boatload of PMs.

If the public owning PMs fuck up what the powers that be want to do, you can bet your ass they will come for yours and mine. Just saying. See the forest for the trees.

Thu, 03/21/2013 - 21:56 | Link to Comment wintermute
wintermute's picture

PMS are great. Most Bitcoiners own some PM too.

The answer is to diversify assets across several fiat-crash-proof investments. Not all of them can be seized at once either.

Fri, 03/22/2013 - 04:12 | Link to Comment Tall Tom
Tall Tom's picture

Time to sink that Boatload in an unfortunate Boating Accident.

 

Personally I lost what little I had as I was burglarized...TOMMOROW. It was such a tragic loss.

Fri, 03/22/2013 - 05:16 | Link to Comment StychoKiller
StychoKiller's picture

I'm selling all I have left for some Bitcoins (the wave of the future™!)

Thu, 03/21/2013 - 21:40 | Link to Comment ziggy59
ziggy59's picture

The schmucks that be hate competition..

Thu, 03/21/2013 - 21:46 | Link to Comment JR
JR's picture

You know what they’re afraid of, Bastiat? They’re afraid of freedom because freedom means that crooks get punished.

Thu, 03/21/2013 - 22:20 | Link to Comment MsCreant
MsCreant's picture

Nice!++++

Thu, 03/21/2013 - 22:12 | Link to Comment NoDebt
NoDebt's picture

Damn.  In the time it took to write it, my post got buried on page 4!  Things move fast around here.  I apologize in advance for shoving it back up front in such an unseemly way, but I think it's worth sharing (you are free, of course, to disagree).  Here it is...

Funny, I just started with BitCoin 3 days ago.  As a "research" experiment.  Had to know what it was about and how it worked.  So I'm an "expert", right? 

None of this surprises me.  The first and primary problem with it (in it's pure form) is that the whole thing is IDEAL FOR MONEY-LAUNDERING.  It's absolutely perfect for that.  Money disappears in country A, reappears in country B (in the local currency, no less!), clean as a whistle.  There was NO WAY sovereign governments were going to allow that to continue, and it looks like they've taken first steps to squelch that in the US.

Those enforcement actions aren't likely to put a big dent in BitCoin.  The real attraction is that there are 21 Billion BitCoins and there will never be more than that.  Like gold, but there aren't even any more gold mines to take more out of the ground.  (Yeah, yeah, I know they said that about Beanie Babies- point taken, I get it, don't beat that dead horse in front of me, I already get it).

What will put a big dent in it is if people start using it to actually do a large number of transactions for legitimate purposes.  THEN IT'S IN COMPETITION WITH LOCAL CURRENCIES.  At that point you will see sovereigns move to actually outlaw it.  Then it's over.  That time is, however, quite a long way off.  You can't really buy shit with BitCoin right now.  It's a curiosity.  If you only had BitCoin you might not starve to death (pizza delivery) but you sure as hell ain't paying your electric bill with it or putting gas in your car with it.

Full disclosure.... I have a grand total of $500 fiat bucks in it right now (more with the recent BTC exchange rate run-up).  If I lose it all, I am unlikely to starve.  Not that anyone here gives a shit if I starve, but that's my total involvement.

That is all.

Thu, 03/21/2013 - 22:48 | Link to Comment wintermute
wintermute's picture

NoDebt, at least you are trying it, not like some others who shoot from the hip.

This is a 4 year old enterprise. It may become bigger than the euro, google, mastercard and JP morgan all put together, or it may stagnate. We just don't know. I have spent several months researching it in detail, and I conclude that the former is more likely.

 

Fri, 03/22/2013 - 04:25 | Link to Comment Tall Tom
Tall Tom's picture

Yeah they might attempt to illegalize it. But with anonymous services and encryption like Tor the chances getting caught transacting in it are Slim to None.  And Slim just left the scene. 

 

Furthermore you can purchase anonymous Debit Cards out of Wal Mart. The Bit Coins can be transferred to a new owner and the Cash credited to that Debit Card where it can purchase Goods and Services in the Above Ground Economy. This is all done anonymously.

 

They can pass all of the legislation they want. They can make it more difficult to use it. But if they are powerless to enforce those regulations then they are just pissin' in the wind.

 

Laws do not stop behavior. (e.g. Prohibition, Drug war, Theft, Rape, and Murder). 

 

Laws only provide PENALTIES for those CAUGHT violating them. Anyone with half a Brain will not be caught.

Do NOT follow this link or you will be banned from the site!