This page has been archived and commenting is disabled.
Another Central Bank Warns Of Bitcoin Risks
First the ECB, then the Fed, and now the Dutch central bank have come out and explicitly warned of the dangers of virtual currencies like Bitcoin and Litecoin. Their explicit statement this morning, raising questions about deposit guarantees, central issuer responsibility, and volatility do their best to inform potential users (or traders) of the alternative currency that it is the devil incarnate. It seems, despite the mainstream media's guffawing at the swings and outrageous fortune in the market's early days, that the powers that be see these crypto-currencies as anything but benign.
Via Dutch Central Bank,
Consumers should be aware of the risks of virtual currency
The emergence and growing popularity of virtual currencies (like bitcoin, litecoin, etc.) are followed by the Dutch Central Bank (DNB) with attention.
The developments around virtual currencies go fast.
At present the state of affairs as follows: virtual currencies fall outside the scope of the Act on Financial Supervision. DNB thus no monitoring of these virtual currencies. Nor, she oversees companies acting herein.
DNB suggests that consumers should be aware of this and will have to realize the risks they run when they buy currencies like bitcoin.
The exchange rate is volatile and there is no central issuer which may be held liable.
Also, the deposit guarantee scheme does not apply.
If this small market cap vicrtual currency is such a "gimmick" as some have said, why are the world's central banks so afraid?
»
- 16567 reads
- Printer-friendly version
- Send to friend
- advertisements -
Wow look at litecoin making it into all the articles now. Our little litecoin's all grows up!
If you put $20 into Bitcoin in 2009, you're a multi-millionaire today. How long before some of that money converts into gold / silver / Porsche 911 turbos? Inflation, coming soon!
And what exactly are they "liable" for with the currencies they "centrally issue" ?
if they fail you get to kill them and call it "crime of passion for fiat"
I'm getting in on the ground floor of "MagiCoin".
Consumers should be aware of the risks of fiat currencyThe developments around fiat currencies go fast... DNB suggests that consumers should be aware of this and will have to realize the risks they run when they trade their labor for currencies like EUR, USD, JPY, etc. The exchange rate is volatile and the central issuer cannot not be held liable...."
No, this is how it should have been written:
Consumers are morons and as your genetic superiors, we will continue to determine the exchange value of every money substitute WE create and control, whether it be fiat, digital or asset based. We enslaved you thousands of years ago and we are never going to give this power up. So, outside of relegating us to Madagascar in a protective bubble, you are screwed.
You continue to fall prey to every meme we create, from government to education, to consumerism, to totalitarian control.
I have some more interesting questions than the usual troll FUD.
Can Bitcoin continue to hyperdeflate against the dollar while everyone in the dollar world pretends that the world is normal around them?
What fundamental factors prevent Bitcoin from continuing to generate returns in the thousand percentile range?
Will Bitcoin fork or will Bitcoin force a balkanization of the internet?
Will Bitcoin finally expose the corporate media for the remaining viewers as no-nothing shills?
Will people finally realize that there can be no stabilization between highly inflationary currencies and highly deflationary currencies?
At what point could Bitcoin form a blackhole that no fiat can escape and collapse the system?
What fundamental factors prevent Bitcoin from continuing to generate returns in the thousand percentile range?
The same reason that all money-for-nothing schemes fail. As the price continues to increase, the risk-reward balance shifts more and more to the risk side. There will be fewer and fewer people willing to spend $1000/$2000/$5000 for a bitcoin. When the price trend turns down, many of those with paper (virtual?) profits in bitcoin will try to cash out. Selling begets more selling and entire bitcoin ramp unwinds.
That's pretty much how all speculative bubbles end.
Okay, fair enough assertion but let's remember Bitcoin is not a stock. It's a currency and it's a currency that has many, many advantages over traditional fiat currencies. Whenever we have seen selling of Bitcoin recently there has been an eager bid to catch it. And most people around the world are not buying entire Bitcoins, another beautiful part of the currency is its superior divisibility.
If you're serious about bitcoin becoming an alternative currency and not just a pump-and-dump scheme, then the best you should hope for is a 6-10% annual increase in the purchasing power of bitcoin, basically mirroring the annual debasement of fiat currency. Expecting 1000% per year is pure speculation.
http://www.larryobrien.net/banking-problems-for-bitcoin-companies/
That was a good read Bindar and I would highly recommend it for anyone who wants a more holistic appreciation of the Bitcoin phenomenon.
thanks fonestar;
I agree with you completely that the big picture of BTC is much more interesting than the current media hype we are reading and watching today.
But it is understandable -- like any potentially distruptive technology, it is easy to get over enthiustiastic about the short term windfall and totally miss the big gains that could be achieved if the technology is deployed and adopted. I guess we will see how this unfolds, but I for one have dipped my toe in the water and have come away being cautiously impressed with the potential to disrupt the banking industry :-)
Bindar
I have a background working in IT and networking. Even with that, when I first heard of Bitcoin I could not get it out of my mind. It kept me coming back as if it were haunting me. Bitcoin is a very deep concept, one that you likely will not fully appreciate at first glance but you will if you keep meditating upon it.
I was on the edge of dumping a few buck into Bitcoin @ $20.00/ea - but decided against it based upon the fact that we're currently working on starting a new business, and our house rules of never engaging in pure speculation and not investing in anything we don't have a very solid working knowledge of.
Having said that - as I've watched this ramp-up - I think that Bitcoin's unstable valuation means that it is not yet acting as a true currency. Bitcoin will breach true alternative currancy status when employees can generally elect to get paid in Bitcoins and when Bitcoin becomes more stable in relation to the price of physical gold and barrels of oil. Put another way, focusing on pricing Bitcoins in fiat shows that it is not quite there yet. The irony is that it may help facilitate fiat's demise as an alternative ruler that cannot be manipulated as easily as fiat and (currently) gold.
Of course this process will take a while (if at all) as the system will not take this outright assault on its foundation sitting down. . .
Not really. Massive increases in BTC purchasing power are indicative of increasing acceptance.
Previously, I had expected that what has happened in BTC would happen instead in gold and silver, where those metals resume their role as money, and as a result purchasing power floods back into them, very suddenly. Like an overnight revaluation to ten or a hundred times its value the day before. That may yet happen.
BTC is analogous to land during the rush to settle the American plains. The earliest adopters were granted truly huge tracts of land (like 10% of the landmass of Texas), while later comers got something more like a few hundred acres, then 40 acres, then smaller and smaller tracts as real land values rose due to more and more people coming, bringing money, and generating value there. This continued for 150-odd years until it reached saturation and we had the foolish notiong that "real estate can only go up". There was a reason it went up so much for so long--it was a new world. Just like bitcoin.
The problem with bitcoin is that the newer competing digital currencies such as litecoin will always offer more percentage appreciation potential, and thus will siphon demand away from bitcoin.
Further, there is no limit to the number of digital competitors that can be created, and thus no protective "moat" around bitcoin to protect its scarcity value. A small group of insiders who bought early and promoted bitcoin will want to cash out and convert their wealth to something tangible. The race to the exits in what is, at bottom, a highly illiquid asset could be horrific. The insiders with big holdings are well aware of this.
Not exactly, the altcoins would need to offer something more and better than the current generation do to become a major threat to Bitcoin. Right now I don't see any.
There are multiple issues with BTC that alt currencies try to solve. FTC solves the 51% problem. LTC partially solves the transaction delay time and the monopolistic tendency of ASIC devices. The problem is that with each fix being provided by a new alt coin, I feel it may debase the value of all of them. Most people I see trading these things are gamblers. Miners are tech geeks. I don't know anyone in China so I can't say how well the supposed adoption is really going there.
All I know is I blew $2000 dollars on a few trips to the movies over the summer buying Gyft cards. I'm a sad panda.
The 51% problem is not really a problem; who would spend hundreds of millions of dollars to destroy the value of the currency?
While for the end user shorter block times is a benefit, for miners, the shorter the block time, the more stale shares and orphaned blocks there are, i.e. wasted effort.
I also suspect that shorter block times may reduce the needed processing power below 51% to carry out an attack, since slower pools may get stuck dumping stale shares and doing flushworks, while the fast pool solves several blocks consecutively.
The alt coins help suck off a bit of the raw speculation from bitcoin, since they have little or no utility. They are not real competition for processing real world transactions.
Litecoin has produced far greater percentage appreciation over the past two months than bitcoin. All bitcoin offers is higher prices, slower appreciation and greater risk. Ultimately, the value of bitcoin and other competing digital currencies will depend entirely on their transaction value - that is the ease with which it can be used to purchase real goods and services in the real economy. Given the extreme difficulty and inconvenience in purchasing bitcoins and the very limited utility as a medium of exchange, it becomes clear that the group of insiders that first mined, bought and now own large percentages of the existing bitcoins will want to transfer the "wealth" they have created to some other more tangible assets. The insiders who created Bitcoin are well aware of its limitations and the lack of any ability to sell in size. Digital currencies are a product of a grand supercycle peak in public mood, and probably one of the most brilliant hustles ever conceived by man.
I think its good for Bitcoin in general that there are already altcoins out there gaining momentum. I'm just thinking in terms of transactional processing, congestion, etc.
Currency is used to exchange specialized labor and other economic inputs of one economic actor into different goods and services provided by some other economic actor. The value proposition for digital currencies is whether they can provoke transactional infrastructure investment sufficient to compete with national currencies for convenience and ease of satisfying transaction demand. In other words can bitcoin ever replace the bank debit card. The answer is a definite "no." However, there is a natural demand for digital currencies as a protection against bad behavior by governments, and the inevitable "Cyprusing" of our transaction deposits. It is an effective hedge against "bail in" risk, currency controls, and other more subtle forms of government confiscation of currencies such as escalating bank account fees, transaction fees, negative interest rate schemes, and gold confiscation, all of which are being actively discussed and planned as "emergency measures" by governments.
Ultimately the issuance of new digital currencies will stop once the most recent entry into that market slams into the wall and fails to produce appreciation and profits for the insiders who create it. At that point the prices of digital currences should stabilize relative to one another, and fluctuate together only as the threat of bad behavior by governments escalates or recedes. Thus, the real value of digital currencies derrives from the ease of transport across borders and the ease of concealing ownership and possession. In otherwords the very aspects that make digital currencies inconvenient for purposes of day to day transactions is what creates their real value as checks against government misbehavior.
Expecting price to follow adoption.
That just shows that you do not understand the nature of Bitcoin or what you should expect when you throw a currency like Bitcoin up against inflationary nationalist currencies. I would expect to see Bitcoin increase thousands of percent against these currencies (I did expect it and was proven correct). You need to check your logic as it does not explain what we are observing and is incorrect.
True but Bitcoin like gold is a store of value. SO its behavior is perfectly normal.
We haven't even begun to see serious speculation yet.
The band hasn't started yet. THey're just warming up, tuning their strings. Get ready for the show!
Fonestar, your questions are not all that interesting because they attempt to focus on functionality within the system, rather than the system itself- WHICH IS MY POINT. This is merely an attempt to change the subject, but here goes:
Bitcoin will do whatever the Elites who created it want it to do. You labor under the delusion that it is anonymous and that the internet is "free". You hope to show you have "outsmarted the system" like some brave new revolutionary. There may be some people that escape with a "profit" (denominated in paper currency or bought products) this does nothing to jeopardize the Elites control. It probably gives them a measure of human behavior and acceptance.
The internet is their highway. Bitcoin is a meaningless marker. You do the math.
If a person hasn't figured out the role of corporate media by now, they don't want to. Bitcoin has nothing to do with it.
People rarely "realize" anything. This is why the system is so successful.
The best example is your willingness to play the game. You obviously have learned nothing.
In a world where humans were not enslaved, they would be free to keep all their labor, to develop enough land to live, to voluntarily contribute to social needs and laws would not exist. We would own nothing, but be caretakers of what we have created and saved. More importantly, we would all understand these facts and never allow them to be corrupted, even to the point of death.
It would be an imperfect world, where we would understand that our ecology is dangerous, but manageable. We would understand we are both predator and prey, thus living in a system that rejects organization that results in permanent rules and those that would enforce them.
I've already given you boneheads more than enough chances to prove once and for all how the NSA, "elites", ______ chosen undesirables supposedly created Bitcoin. I even offered you an ounce of gold if you could prove it. There's no reason to believe Bitcoin required any assistance from .gov or any intelligence agencies. But facts will never prevent you from pulling a good conspiracy out of your ass to meet your preconceived bias.
Fine, identify Satoshi Nakamoto. Trololololololololololo....
Read: Eustace Mullins, "The Secret Order" and "Curse of Canaan", "The Controversy of Zion" by Doulas Reed, "The Creature from Jekyll Island" and Fritz Springmeier, "Bloodlines of the Illuminati".
Choosing to remain ignorant and using specious offers does not an argument make...
<----bitcoin crash coming soon!
<----bitcoin will continue its meteoric rise!
OK, where's that little pr*ck, fonestar to tell us all how the CB's don't matter, until they don't matter?
DaddyO
edit:Ha, he beat me to the punch, little bast*rd...
Right, if you can't beat someone's logic engage in ad-hominem attacks.
And besides your stupid wishes, what fundamental factors do you see changing that would stop Bitcoin's rise?
I don't own a single bitcoin, don't want to own a single bitcoin and hope you make a gazzilion dollars!
Just remember, no one cares how much you know until they know how much you care.
In my view the whole world economy is built on shifting sand and there are huge storm clouds building on all sides.
The storms are going to produce floods that no one or thing or .gov can resist, when this flood comes only real, tangible stores of goods will sustain their holders.
So buy moar bitcoins, securities or other fiat assets and see how well you do in the coming storm.
/rant off
DaddyO
Well you can be dismissive, pretend that Bitcoin does not exist or whatever you like. It doesn't stop the fact that it does exist and even if you cheer from the sidelines you can make postulates on potential outcomes. Some will be right and others wrong. This is the most interesting game in town to watch.
The Casino Is OPEN!
I dabbled in BTC, didn't put much in but like the gamble. If it goes to zero, not a big deal and I do think it eventually goes to zero or close. Also willing to admit I can be wrong. It wouldn't be the first time but it looks like a bubble to me.
That said, how does one create a wallet, put those darn little coins in said wallet, and take it offline? Thanks.
Even at $1100 BTC a person can spend $20 on BTC and own more BTC than virtually everyone else on Earth.
give the elctrum wallet a try. It has a high entropy seed function that mamkes it pretty much idiot proof. Not that youre an idiot. But digitalmoney is lost in different ways than gold, cash etc. So take it slow at first. Start with electrum.
If you were selling today and wanted US$ where would you sell?
https://btc-e.com/
Alot of people on /g/ have been posting evidence that this really is the only exchange that is paying out. I've yet to see Mt. Gox pay out a substantial portion of cash.
Thanks.
I'd like to hear fonestar's answer, also.
Edit: They are buying at $975 though most sites show $1100+ ?
I just deal with localbitcoins.com. The exchanges are a pain in the ass and giving all of your information to meet compliance bullshit seems contrary to the crypto-anarchist roots of Bitcoin.
Canada Virtual Exchange pays out. And just issued debit cards.
Well I see one important one. Since bitcoin is backed by nothing (not that, that, in of itself, is its demise) but that since it is not backed, it will find itself to have no more utility over other altcoins, save that, of early adoption. Now because of early adoption, all other altcoins will will be at a disadvantage until the free market asserts itself. If bitcoin is the same as tulipcoin in most every way, save that of early adoption, then as the market chooses to enter, it can enter at bitcoin $5,000 or tulipcoin $5. Therein lies the crux.
Any concerns simply dial 1-800-FUCKYO.....ask for Alice.
Go ask Alice? Oh I think she'll know. When logic and proportion have fallen sloppy dead....
Follow the White Rabbit...
http://www.youtube.com/watch?v=XR8LFNUr3vw
BTC is at peak media, it's in the news every goddamn day.
And it's central banks and the US government that keep it in the news.
I don' think they are afraid. I think they are behind it.
This is probably the most interesting perspective of all. Only time will tell for sure, but the public nature of all transactions is a very salient point in support of this theory.
Time to get out of BitCoin. Let me see, central banks have unlimited ability to print fiat, bitcoin is purchased with fiat....hmmm I wonder who is behind the run up in price? Now with the warning out, CB's will dump bitcoin, price will collapse and they will say "Told you so". Don't fuck with CBs, didn't we learn something from trying to short USTs?
I totally agree with your conjecture. The easiest and safest way to discredit virtual currencies is to create wild volatility via the old pump & dump mantra. Best and worst thing about BTC is it's anonymous!
And to boot, it has been the brainchild of many a NSA cryptologist... Cryptonomicon, any one?
Thousands of technologies we use on a daily basis started off as military technologies. Why would that be any different as it pertains to virtual currencies?
Yes, but we know that those technologies have backdoors built-in. That is common knowledge. With crypto, the difference is the backdoors are unknown to us.
No, Bitcoin and the cryptography used in it is entirely open source. Nobody would trust it if it were not.
Uhh, gold, silver, and literally every other thing in the world can be purchased with fiat. That isn't an argument.
Bitcoin has features that make it worthwhile. "The price only goes up" is not one of them. It doesn't matter what the price is, you can use them to bypass the financial system, specifically currency controls. Best to buy it now, before they make it impossible to do so in size. It's already getting harder.
It can't become scarce since it's only used as currency.
It may get more expensive (personally i think it will get cheaper) but why would you care if you only intend to use it to transact.
I use it also as a store of wealth. Why? Fuck you, that's why. It is currently scarce to the tune of $1,150.
I certainly wish I had climbed on board as an early adopter.
If you go to crypto trade or bter.com you will see the volume of "scarce" crypto is at about 40 already.
There are also scam crypto currencies that have been pre-mined.
One of the most difficult things in this world is preserving your purchasing power over long periods of time.
Yeah sounds like a plan, CB's chasing a limited supply of gold and silver as a means to prove how stable their fiat money is, great thinking :-S
Bitcoin is like phyzz... as long as the central bank is in control of the issuance of a nations fiat, they care not who makes the laws or how much of it is (data)mined.
It's not interesting at all. I've already read many captive peoples response and they have figured out the dangers of Bitcoin for themselves. One woman called it "abhorent" and wanted it stopped. They realize that Bitcoin could defund the grand illusion they've spent the past century building.
If they weren't behind it and they were truly worried about, then they would do something under the table to try and hammer virtual currencies. They wouldn't simply give a warning. Seriously, think about it: the Fed giving a warning about the dangers of anything financial????
When have you heard the Fed ever come out and give a warning about gold? Instead, they always just say something along the lines of gold being irrelevant & play stupid.
I guess the fact that banks won't keep any of the exchanges' bank accounts open means nothing, huh?
They are trying to foreshadow. Then the crash will come in 3 months (or sooner, or later), and they will say "Behold, our wisdom. The prophecy has come to pass."
They can't generate credibility any more with their economic policies, so they need new ways to convince us all of their superior intellect in all matters financial.
I listened to Bernanke's testimony and I do not believe he was endorsing Bitcoin as some people have claimed. He was just stating the obvious, that the Fed had no jurisdiction over Bitcoin. Also, I believe he could have been trying to salvage some of his professional image for posterities sakes.
"Hey, at least I got the Bitcoin thing right!"
When even the shoeshine boy says to buy, its time to GTFO. Hence why BitCoin's time is now very, very limited. Then people will learn that virtual currency is the same as stocks, just cause supply is limited doesn't make it valuable, especially when nothing is backing it.
Speaking of which, has anyone issued an Amber Alert yet? The local BTC whore seems to have gone missing. I'm surprised there was a bitcoin article and the kid didn't show.
In the case of virtual currencies, backing is a fault. When something is backed it implies centralization, counterparty and trust. Your backing can be stolen, devalued, rehypothecated. A virtual currency must stand on its own merits, decentralized and beyond human trust.
lol! Its zero sum, idiot.
Inflation coming soon, finally the Bernank gets what he want's. Fiat panic bitchez.
¥en is in a baaaad place right now.
If
well... if you look at all the hardware that is connected to "the internet" and you just add it all as collateral for litecoin just like bitcoin... THAT MEANS LITECOIN IS WORTH BILLIONS JUST LIKE BITCOIN TO!!!
"well... if you look at all the hardware that is connected to "the internet"..."
It's a series of tubes. I think a US Senator said that.
I'm in the black. GO LITECOIN CURRENCY OF THE FUTURE AND WORK OF GENIUS.
(Disclaimer - I may or may not profit when you purchase litecoin)
They still don't get what cryptocoins are backed by.
Last famous words:
"don't keep your monies in .dat file!"
CALLING FOR MONKEYBOY AND REDNECK!!!
Let's hope Quark will be next!
The entire Dutch banking system went bankrupt under their financial "supervision". Fuck them with a 10 foot pole.
Didn't Cyprus banks have a deposit guarantee? Oops.
It was just a loose set of guidelines really....thankfully the politicians got involved and fixed it.
Yes, 100,000 Euros gaurantee. As far as I know, everyone was protected up to the 100,000 limit. The gaurantee worked fine.
If there is one thing central banks fear the most it is honest money.
Your comment may be accurate, however bitcoin is not honest money and TPTB will crush it when they feel it is time. They have an unlimited amount of digital currency to move the bitcoin market in any direction they wish. All they have to do is fund multiple account, ramp up the price of bitcoin, and then cash out. They don't care if they "take a loss" it doesn't cost them a nickle to push print.
Followup Q's:
How? Like gold?
The rich gonna change the rules and outlaw it?
Doesn't that affirm my point that "virtual currencies" are real money (hence a threat to the established mafia of fake money)?
Virtual currencies are a threat because they undermine the power of those with printers and failed policy.
Virtual currencies are a threat? Or physical gold and silver are a threat?
That would be interesting to watch and would likely have the unintended side effect of validating digital currencies.
In any event, BTC has proven that people do not fear the pump and dumpers. This weekend was a good example where a large player repositioned at a lower price and it's back where it was.
Quite a statement when people choose an experimental volalite digital toy over a protected, centrally managed fiat backed by the full power of government.
I think that the FED like powers that be have already purchased much of the bit-coins. With fiat money, it is free to them. Watch for them to sell them in large blocks like they have PMs.
Also the same authorization for manipulation of PMs gives them the authority to manipulate virtual currencies. Someone here pointed out the actual phrases....
While they cannot short it to oblivion like they can PM via ETFs, they can make them so volatile as to make them unpalatable to retail...
I have no doubt that they have. Take a look at the major holders in this post:
http://www.zerohedge.com/news/2013-11-27/presenting-bitkillers-these-are-richest-holders-bitcoin
And buy the way the largest holder's address begins with 1933
And, whats to keep them from setting up exchanges, where they 'sell Bitcoins' which don't exist, or sell them to multiple parties? You will never know, as 'we will hold the BTC for you'.
You can already find exchanges that are not good, just do a small test to see if you can actually cash out money and bitcoins.
You see, with bitcoin the exchanges are far more likely to get robbed or crash or be a scam than keeping the money in your own wallet, so you should only be putting amounts into exchanges that you plan on exchanging; you should not be using an exchange or a mining pool as a bank.
BTW, for the common person on the street, the central bank warning in the article seems like a legitamate warning, not an act of fear or desperation. They are simply advising people that you get no deposit gaurantee, so if you put money or bitcoins into an exchange and it is robbed, you lose your money.
Agreed. A more organic virtual currency will evolve successfully at some point in the future, but Bitcoin is not it.
Correct, banks are no longer "banks", they are middlemen steal value from the real economy. They are parasites and the providers of goods and services and their customers are all too happy to cut these useless paper-pushers out of the picture.
Although Bitcoin is exciting for some and no doubt a way to make money from nothing, there is zero percent chance bitcoin will survive long term. Historically, private currencies have been crushed by the government. If Bitcoin, litcoin, or whatever-this-month-coin gains a foot hold, without a doubt governments will outlaw it.
They may have to outlaw the internet first. Not saying they won't.
In fact I'd say there's a fair chance it'll be attempted and crypto currency will be a BIG reason why.
The reason Bitcoin has value is demand. Not because of some unknown magic. If the government goes public and states anyone who uses bitcoin is subject to 10 yrs in jail and $50k fine, demand will be crushed. Value will go to zero.
or demand might skyrocket. Cocaine is "illegal", has it's demand gone down?
Not very bright are you?
Bright? You pin the success of bitcoin on the fact cocain is traded illegally and for high value? This is the recipe for success of bitcoin? enough said, idiot.
EDIT: yes, demand is down for cocain. Do you believe demand for cocain would go down if it was legal? BS, it would go up. making it illegal reduces demand.
You said said this --> "The reason Bitcoin has value is demand."
Do you stand buy this statement or not? Unlike a physical stash of cocaine, which can be confiscated and used as evidence, how exactly will this confiscation occur so that one could be prosecuted? All these transactions and "bits" are anonymous and stored on hard drives all over the world.
I am not supporting bitcoin as a store of value (as central banks have unlimited purchasing power and can also buy bits), but you made the statement, not me. Idiot indeed. Think a bit harder, I'd argue that the value is in cutting out the middleman between a customer and someone that has something to sell (sounds a lot like a real free market to me - BTW, there are many ways to do this).
I stand by the statement. It is an economic law. Bitcoin is musical chairs (like all currency). The government does not need to confiscate it to reduce it usage. The only purpose of bitcoin is to trade it for something. If government outlaw the use of Bitcoin as means of tranaction, it kill the whole purpose. How will they stop it? Easy, take out the big players like the nonsense ETF and the bobsie twins and all the casual users will run scared. They will toss their flash drives, and anyone (I heard there was a few) who accept Bitcoin for actual trade goods will stop. Sure a few drug dealers will still use it, but it will not be mainstream.
The reason illegal substances have value even though they outlawed is they surve a purpose. Bitcoin doesnt even look shiny.
So you're a "free market"/"economic law" guy who doesn't see the value in cryptocurrencies that cut out the middleman and connect people offering real goods and services with their customers. The thing about "laws" is they must be enforced. I save my wealth in real physical assets, including PMs (have been for 25+ years) but as a free market guy myself I see the value in anything that allows me to exchange with others without any middle men. I would never store my wealth in bits, big difference.
But even if I had bits on a jump drive, go ahead and try to confiscate that jump drive motherfucker, good luck with all that cognitive dissonance Dr. No.
I never stated I dont see value in crytocurrencies. You assumed that. I encourage their use; infact i mined a few a while back and cashed in. However, history is riddled with private currency programs that all end with a bunch of players competing and ultimately the government comes in and sweeps the board. Bitcoin, Litecoin, Quarkcoin, what-next-coin will all compete and one day leave a sour taste in someone's mouth and the corrupt government will sweep in to "save the day".
Its a total rerun.
BTW, I dont need to confiscate your jump drive. it is up to you to find a sucker to buy those bits with something (musical chairs). Or just salvage the price of that jump drive and rewrite with your family photos.
"I never stated I dont see value in crytocurrencies."
"Value will go to zero."
Things that make you go DDDUUUUUURRRRRRRR...
Value today; as in $1072 each. Long enough timeline, remember?
So exchange those bits for physical ASAP. Fucking duh.
You could prosecute in the world court, which may be why we are seeing this latest warning, or you could be prosecuted by public opinion, but that could take a while. Either way time is not on the coins side.
Perhaps, but good luck collecting the evidence. All I am saying is that I can see the value in any means of exchange that cuts out useless paperpushing middlemen. I would never save in "bits". When fruad is the status quo (as it is now) possession is the law.
Evidence? You're cute with the whole "rule of law" thing. Hell, they'll probably bring up your ZH posts as evidence .
how exactly will this confiscation occur so that one could be prosecuted?
I'm sure the NSA is finding that out as we speak. One thing is for sure, Bitcoin is not immune from gov at all.
I expect the bitcoin community will ban fiat before the central banks ban bitcoin.
Pretty tough to do when the main use of btc is to buy drugs and kiddy porn.
Junker. Was it my use of the term "kiddy porn"? If it makes you feel better I don't even do drugs.
Never heard you could buy kp with it. You sure seem to know a lot about that.
KP? I thought that was washing dishes.
YOU seem to know all about it.
Bought gold last night for less than $100/oz when considering what the cost of my bitcoins were. Maybe this is more what they are worried about, XFER of wealth to those who are not the .001%
So Sen. Schumer throws a hissy fit and the U.S. tries to make bitcoin illegal - who gives a fuck? You think the entire world will stop using it because banksters are afraid it will cut them out of the loop? Ha, I think the entire world will be more motivated to use it or something that resembles it to cut the banksters out.
Why does Target have the Red Card? The thingy that draws straight from your checking account cuts out Visa/MC/Discover/Amex. Don't be shocked in 12 months when Target and many others accept bitcoins.
This is desperation and fear from another CB afraid that their power and influence might wane. The skank whore that doesn't get hit on anymore is not happy about it so she will tell everyone that the other girls have stds.
you had me at skank whore !
It doesn't have value because of demand. The vast majority has been consolidated ino a few hands. Now that they have ramped it up, they will soon start dumping on retail.
http://www.zerohedge.com/news/2013-11-27/presenting-bitkillers-these-are-richest-holders-bitcoin
I had to junk you. That is the very definition of demand. People want what only a few have. So much to the point they are willing to pay $1072 for one.
You may need to look at the chart again and analyze the dates of their last purchase versus price action. This is a typical pump and dump. Consolidate, ramp up the price to simulate demand, advertise on CNBC, and then dump on unsuspecting retail.
I upped you for that. It is so obvious what is happening. But simulated demand vs demand - it all works to increase the price. With so little float, it takes little demand to pump, but demand is what does it.
Just so we're clear, y'all be making these same statements at $10k, $25k, $100k?
Since when is 20% is vast majority, Dr. Engali?
What, pray tell, is the consolidation among the top 100 Gold holder's hands?
"Vast majority"
"20%"
Things that make you go DDDUUUUUUUUUURRRRRRRR...
The top 500 addresses hold 40% of bitcoin. That is a pretyy strong concentration.
Apply that metric to gold, genius. You'll notice something interesting.
Early adopters got rich, so what? Why are you more afraid of crypto-anarchists than central banks?
Shit, that doesn't bode well for PMs!
Wow, what's it like living in liberal fantasyland?
No guns-they're illegal. No drugs, they're illegal. No financial fraud, that's illegal. Etc etc.
"If the government goes public and states anyone who uses bitcoin is subject to 10 yrs in jail and $50k fine, demand will be crushed. Value will go to zero."
You mean the American Government? That is why, due to regime uncertainty, America is not the center of the bitcoin ecosystem. The opportunities to really make money providing goods and services are thriving outside America.
Welcome this. Risk to CBs is they find the can't or they become simply ignored. Then the floodgates open by current bench sitters. If CBs are successful, better we find out sooner rather than later.
You do realize that bitcoin was probably financed and developed by DARPA right? the libertarian myth that bitcoin was created and funded by a single Japanese guy is a complete and utter sham. Do some research on it's origins.
Correct. Moreover, the central banks have some very savy computer people and unlimited purchasing power, they can buy bitcoins just as easily as you and I. When fraud is the status quo, possession is the law, all you need to know.
So the central banks created cryptocurrency so that crypto-anarchists who adopted it early would become multi-millionaires while simultaneously cutting the heart out of the financial transfer system, and building the base for bitcoinx to destroy the remained of the financial system and usurp much of the role of government in private enterprise?
Sure is Mel Gibson in Conspiracy Theory in here.
You guys aren't from NASA are you?
Assuming they cash out now, they are multimillionaires.
How many former middle class will be rendered working poor, by Bitcoin speculation? It awaits to be seen.
https://btc-e.com/
Go to that site. Read the chat box for a few minutes. Those are the people buying Bitcoins at current prices. Bagholders. Greater fools. Call them what you will, but they all think they are geniuses, and are onto something no one else even knows about. This is a distribution phase, IMO.
So, who are you to determine what another person is allowed to risk their money on? If free people freely choose to gamble away their life savings, that is their choice to make. They are free to make a fortune, they are free to lose a fortune.
Could have been written by my niece, doesn't matter. It's public domain. The code belongs to me, you, and everybody else now.
I trust nothing that is SECRET. PERIOD
Bitcoin is open source. It's more transparent than ZH.
"governments will outlaw it"
honey badger doesn't care
Stop fear of the tiny dot!
http://www.youtube.com/watch?v=zijmsZGFpO4
You got it backwards. Governments cannot kill Bitcoin. Bitcoin can kill governments.
It replaces many of their functions with a highly efficient blockchain for currency, ownership, and contract law. Tech dismantaling borders
Dinosaurs hate technology and then they die.
"no central issuer" - that's why they are called decentralised.
... and that's why there is no counterparty risk.
The counterparty risk is the exchanges. That, and the weaknesses in operating systems and client software.
i got a guestion. so someone buy btc. where this money end up? end when someone sell btc where the money come from?
usually bitcoin exchanges sell bitcoins for money and buy bitcoins for money....ie, the actual bitcoins are not really worth anything if the exchange is down..
roughly
Exchanges don't buy and sell they only setup the medium for the exchange and take a commission .
You can trade online without a centralised exchange through something like localbitcoins and people are currently working on decentralised exchanges to mitigate the centralised risk of exchanges ,
"deposit guarantee" - your BTC etc are the owners responsibility.
"The exchange rate is volatile and there is no central issuer which may be held liable"
Now that is rich. When have the criminals responsible for inflating away our buying power been held accountable? They do what they fucking wish.
Cool new trade idea:
I had to trade btc for ltc.
Just trade your "important" crypto currency for the next unknown = profit.
Anyone know the next one? I'm newe at this.