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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?
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Go to www.cryptsy.com and take your pick. I have heard Quark or QRK could be the next big thing.
Kewl dude.
Thanks for that. I'll trade my ltc very soon I reckon.
This may jump quickly, hopefully I can make the final jump to PMs quick enough.
(duplicate, deleted)
Very unique ideas, I'm sure noone has thought of that before!
By now everyone and their uncle drunkard are buying the next big crypto thing.
By New Year's people will start realizing all such (not backed by anything) crypto currencies are worth the paper they're printed on.
Desc: long PMs and a tiny bit of crypto currencies.
Alt coins are a great place for gamblers to go lose their money. The guys who really run those shows will be dumping your money back into BTC.
The central banks are afraid of this suddenly popular form of artificial currency for several reasons, the primary one being that the recent rise of bitcoin points out in a very visceral and immediate way the ephemeral nature of all artificial currencies, including the ones they manage.
Since you are very stupid let me point it out for you. A cabal of central banks could and would crush bitcoin if it suited them. They can manipulate far bigger markets than bit-coin. You know that digital currency is actually a central banks wet dream don't you?
Larry Summers is in favor of a cashless, all-digital money system. The fact that Larry Summers is on their side should cause bitcoin-istas to reassess their world view.
How about this: TPTB are opportunistic parasites that survive by hijacking good ideas and causes and corrupting them to their benefit? They did that with nationalism, socialism, environmentalism, genetics and anything else that is popular. That's how psychopaths adapt, they blend in, wolves in sheep's clothes. What do you think Obama was? He was whoring out to the tune of Hope and Change. Hows that think going anyway? Summers, Bernanke, the whole lot, could profit more from jumping on the bandwagon than going against. But then again, the war on drugs never turned out well.
Lets watch what TPTB do with Bitcoin, then draw conclusions about who is on who's side. If TPTB crack down on Bitcoin harder than Rob Ford does on crack, then the theory that Bitcoin is their brainchild can come to rest. Unless of course.....another crazy possibility arises. Nothing seems to make sense anymore.
Uhm, that's bullshit.
They can buy up all Bitcoins out there and then what? Moron.
They could. Just like they have done with gold.
Pretend that its worth real money and buy real assets with it and decide who gets to use it, charge interest on it, just like they do now with paper money.
I'll sell them one of mine if they offer me enough fiat for it. They rest I'll hold on to and see how this all plays out. If they drop the price to the floor, I'll buy some back cheap and hold. I can play this game for a while as Bitcoin is not overweight in my portfolio. The coins I use in transactions I immediatly replace by spending fiat to re-acquire.
Banks: Oh shit on second thoughts we actually stand to lose alot of money skimming money from transactions, they can't dare step into our monopoly!
Deposit guarantee? What the fuck are they smoking? Unless you issue physical Bitcoins so that the digital Bitcoins become claims on the coins just like the numbers on your bank account are claims on the pieces of paper with dead presidents on them, then deposit guarantees are an immaterial notion. Or maybe that's precisley what they imagine?
Or is Bitcoin more about having value from a virtual existence rather than anything physical? Assuming that the internet is here to stay for good, perhaps.
The Dutch statement sounds more like an advertisement than an attempt to portray webcoins as "the devil incarnate". Almost as if they want as many as possible to know about them and start using them.
“held liable” – that’s why they are called peer-to-peer and they are without counterparty risk.
Except when the "exchange" where you're storing them gets "hacked" and you lose everything.
http://blogs.computerworld.com/cybercrime-and-hacking/23217/huge-bitcoin...
Aaaaaaand it's gone...
Agreed . . . but it is very easy to store them outside of an "exchange". You keep the private key (either in your head or in your own vault) and they are then mathematically impossible to steal. When you're ready to spend or redeem for silver, you can simply enter the private key.
did that last night,except for gold, and was amazed at the speed of the transaction. From paper wallet, to online wallet, to retailer in less than 7 minutes and funds recieved transaction complete in seconds.
Except most people aren't up to the task of keeping a wallet off-line. They will let others 'hold' their BTC for them, through online wallets, (banks have taught them well), and their BTC will be 'hacked'.
TPTB did not expect competition when they embarked on draining the entire world of its wealth but they went so far that they have orchestrated a huge backlash that could permanently diminish there power .
They are 5 years to late in attacking crypto currencies there is little they can do about it short of shutting off the internet , people always forget Bitcoin is global, for every one country that tries to regulate it out of existence there will be 10 more that will accept with open arms ,
BINGO. Exactly.
so i was thinking - what "IF"
no one truly knows who the creator of the software protocol for bitocoin "Satoshi" truly is. "WHAT IF" satoshi is in fact a linked agency to the banking cartel's central bank.
"WHAT IF" those same central banks colluded to despise there own creation? better to have the masses "think" they are doing freely what was planned from the beginning.
"WHAT IF" the idea of crypto currency was to permanently make all money digital.
"WHAT IF" at some point in the future big banks started to "buy up" and control all the infrastructure of digital currency?
etc, etc......you see where i am going with this line of "what ifs".......
What if Satoshi wanted his code to stand on its own merits, not tied to some personality. What if he wanted eyeballs pouring over the code for years and years, improving it, trying to break the fuck out of it. So he released it all into the public domain. What if he thought the powers that be and criminals would come after him sooner or later?
What if bankers all committed suicide?
If they made bitcoin, they made themselves obsolete.
The problem with digital money as we knew it in the past was that it was just fiat and could be issued in unlimited quantities just like fiat. Further, it was never peer to peer. Trusted financial institutions were always going to be a part of it. This is no longer the case. IE they shot themselves in the fucking head.
This is sort of like asking "What if Stalin created a free market in Russia?" Well, that would have been GREAT! But he didn't, and he never would have in a million years.
There ain't no infrastructure to buy up. It's all done by miners and users, hence P2P.
What they are really worried about is Bitcoin trading at parity with the price of gold.
My view is totally opposite. I would imagine they would be happy to see 1oz gold worth less than 1 Bitcoin.
It's getting back to spitting distance again. Have a feeling bitcoin is eyeing some real estate on the other side of the street.
You know the central bwanksters and the gobmint are very worried when they start talking about it so much.
Worried about people?! Hah, worried that people will stop using their printed toilet rolls more like.
Bitcoin Was Created By DARPA
What a bunch of bullshit.
Disc: Long PMs and a tiny amount of crypto currencies.
https://www.nacha.org/aboutus
"Godlikeproductions"
How do you keep from drowning in the shower?
Even if it wasn't crazy speculation, what do you care where the scapel that cuts out the heart of the corrupt financial system was made? It's a simple tool that is fully transparent.
Yep, the super-competant, amazingly capable government that brought you the F-35, ObamaCare, and that awesome military threat software that cost billions but doesn't work, secretly cooked up bitcoin.
If you are going to have a conspiracy, at least make it believable. Like, if you said Goldman Sachs created bitcoin and is the largest holder, that might be believable. Saying central bankers, NSA or whatever made it is pretty nonsense.
I've tried to find people in the circle of sheeple I know talking about Bitcoin, haven't found anyone. But that just means they are stupid to miss out on all the gains right? I know a few people aware of Bitcoin but have been turned off by the volatility and digital wallet.
The biggest issue is the difficulty buying a Bitcoin now, at least in the US. Banks have blocked wire transfers to the exchanges. You must use cash now and find someone to meet you in person, or use a Bitcoin ATM with biometric identification. Hardly the anonymous Internet based virtual currency promised. Then there is the problem of what to do if you want to cash out your mega gains in Bitcoin for dollars. A massive wire transfer, or a string of smaller ones will get the IRS crawling up your ass.
You have to trust that the person you are handing cash is giving you a valid Bitcoin, and not one that has been splintered from the blockchain. One has to wonder why someone would sell you something appreciating in value so fast. I remember all the stories last year of Bitcoin that were traded at a different price from the exchanges and blocked from use. Or has there been a fix for transactions not validated by the blockchain? I've heard of a lot of Bitcoin transactions where the reciever doesn't need to download the block chain first. I thought that was supposed to be impossible.
I also wonder what happens if it is possible to tie the transactions recorded by the block chain to a person. Say you are found with Bitcoin 111334, and that Bitcoin was used to pay for something illegal. You are essentially holding the receipt for it. If you bought a stolen TV, you are the one that takes the rap for it if the police find you. Whether or not you knew it was stolen. You might have Bitcoin that could be tied to hundreds of purchases on the Silk Road.
Most Bitcoin advocates want merchants to use bitpay or something else that does conversions automatically. My question is, where does the Bitcoin go? You use Bitcoin and Bitpay does the conversion and gives the merchant the dollar value. Does Bitpay hold the Bitcoin in escrow until someone uses dollars to buy a Bitcoin from Bitpay? It kind of seems like a crazy gift card scheme. Only most people who bought Bitcoins last month will be able to buy far more than what they put in. Like a Best Buy gift card you paid $200 for all of sudden being good for $1200.
I worry that the government could declare Bitcoin a counterfeit currency and declare the forfeiture of items bought with them. Essentially blocking mainstream adoption by retailers. If I somehow received a counterfeit $20 bill, I'm out $20. If I bought $10k in Bitcoin, and can't use it, I'm out $10k. Or I just turn to the underground Bitcoin economy.
> You have to trust that the person you are handing cash is giving you a valid Bitcoin, and not one that has been splintered from the blockchain.
My experience: Wait for a sufficient number of confirmations. It may take a cup of coffee at Starbucks while you're waiting for that to happen (my experience). The counterparty will probably be interesting to talk to, else a complete Johnny come lately type of moron.
Who the fuck would buy a stolen TV with Bitcoins? Just sayin lol. If I needed a stolen TV, I'd prefer to inspect it and probably use cash.
There are some wallets that dont need to download the entire blockchain. Shit is out there...if you seek you shall find.
Anyway, one quote from Jesse Ventura comes to mind.
As soon as you make something illegal, you're essentially making criminals run it.
If the government was smart, it would be trying to facilitate pure, quality weed from dispensaries, and collecting taxes on that baby. Win win. But I guess that's why I don't work in government.
Hearing rumors 25k locations in the UK and 240k locations in Russia may start selling bitcoins in January. Walk into any corner store supported by ZipZap and buy a bitcoin?
[link] [link2]
Its hard to keep track of so many developments. Whatever Bitcoin's fate is, it has already caused a paradigm shift in thinking, planting seeds in the minds of many people. Once alternatives begin to multiply, watch the old order lose control...even more
I think the largest misconception upon bitcoin is that it is a "currency" it is not a currency, it is a transfer payment system. It is a fully encrypted, limited supply transfer mechanism between two parties swapping goods and services. It is the modern day barter system. What gives Bitcoin value is that it is not a currency, but yet it is convertible if you so chose, second it is fully anonymous in terms of central banks and their cartel as well as taxation. Fiat banking systems are nothing more than modern day serfdom, extracting labor and injecting money created from nothing. I am not doom and gloom on the dollar, I think that in the internet age where goods are bought and sold in a place that doesn't exist in reality, Bitcoin offers the most easiest transfer of payment there is. I think more in terms of Visa or MC and their 2 to 3% fees. Bitcoin should eliminate the existance of those businesses. Remember just 1% of Global GDP if Bitcoins were used, would place a value at $720 that is 1% of all transactions, now you can see if it becomes the payment transfer system of choice and a mere 10% of all transactions global pass thru Bitcoin, than that is a $7200 per Dollar valuation. See in this QE environment, with limited 21 million Bitcoin supply, the price is virtually guaranteed to go higher. Speculation has nothing to do with it, its first to buy them and hold them and never get rid of them, will enjoy the largest gains. If I were Google, I would buy as many as I can and make it the virtual transfer payment system of choice...Maybe this is the Winklevoss twins way of getting back at Google. All I know is $720 is probably the lowest in fundamental terms. I will never sell. Hey it beats a 529b plan for my kids thats for sure.
Bitcoin official fiat of Skynet...
I'm waiting for Fonestar to get in here and create 1000 posts about how "awesome BTC is and why its the way of the future, so buy now or be priced out"
When the time comes, the gov will determine eveyone with a digital wallet is a financial terrorist. They will put these people on the no fly list, and call in the IRS. They will make life hell for having the wallet. They will use the NSA, NDAA,and IRS to solve the USA use of bitcoin. They might not know how to get your bitcoins, but they know how to get you. Someone said that bitcoin can go across boarders undetected - not if you are detected and not allowed!
FEAR THE ULTIMATE GOVERNMENT! COWER BENEATH ITS PURE AWESOMENESS! TUCK TAIL, RUN, AND NEVER THINK OF ESCAPE AGAIN!
/sarc
Must suck to be American.
How do banks make their money? They make it primarily on the skim off the top of transactions as the middle man. Petrodollar is the biggest skim job of them all but the lesser TBTF banks make a big bulk of their revenue on transaction fees on digital commerce and ATM swipe fees. It is digital based not analog. Crypto-currency's true disruptive power is to this crucial revenue stream for the banks on a local and global scale. As a medium of exchange for digital commerce crypto-currences provide real value while cutting out the middle men who skim off the transactions. It means the Central Banks need to print moar to offset that loss of revenue which probably messes up their pretty little math equations they use.
So Bitcoin is NSA created to come along precisely when they might lose control of gold/silver?
And the Queen is the mastermind behind the New World Order.
Really? I thought it was Prince Charles.
Dear Central Bankers,
Here’s your frothy cup of STFU. Exposure of your lie will ripple across the globe.
Money Confiscation Legal?
Let me know if you need a tissue to pad your crocodile tears.
Amen. But please allow me to wipe my ass with that tissue before you give it to them.
It's all fiat... but BTC is a controlled and limited supply and to it's demise is it's predictability of being (data)mined. Makes it real easy for the CB to manipulate it.
I really don't care what kind of fucking mania or bubble bitcoin might be in, they can all go fuck themselves and mind their own fucking business.
When central bankers get scared enough to start making anti Bitcoin statements, it can only be good for the average man in the steet.
Bitcoin theft:
http://www.newstatesman.com/future-proof/2013/12/theres-%C2%A360m-bitcoin-heist-going-down-right-now-and-you-can-watch-real-time
It is precisely this sort of risk that makes crypto-digital-currencies a NO for me. Well, that and the fact that digital money is paper fiat on dilithium steroids traveling at Warp 10.
The money was stolen from Silk Road 2.0. Why would you send your money to some random website? Because everyone else is doing it?
Why are the central banksters so afraid? Four words:
Gradual. Loss. Of. Control.
I'm no fan of crypto-currencies, but welcome the CHOICE of competing currencies they represent. In the end, a 100% digital currency is the bankster's wet dream come true. What they absolutely CANNOT have, however, is multiple forms of such currencies, unless they're ALL under their control.
Looks like someone else reads Reddit too:
http://www.newstatesman.com/future-proof/2013/12/theres-%C2%A360m-bitcoin-heist-going-down-right-now-and-you-can-watch-real-time
This is now officially a repost. Downvoting myself.
Have we forgotten? The last thing you can expect from a cenral banker to do is to tell the public the truth.
This is a "proud calling" dedicated to the preservation of the US hegemony in first position, with 700 military bases to ensure copmliance, all paid for in promises stating that the American taxpayer will front up.
And you expect the truth from such as POS Bernanke, destroyer of our future? Bitcoin, Litecoin etc are the monetary equivalent of a stake and a clove of garlic to a vampire.
Massive Bitcoin heist going on right now by the way, to the tune of 60 Million Pounds making it as large as any of the famous robberies in history, yet few media even report about the event, you can watch it go down pretty much real-time on the reddit forums mentioned in the article too:
http://www.newstatesman.com/future-proof/2013/12/theres-%C2%A360m-bitcoi...
EDIT: Fuck me, I should have read the latest comments before posting myself..Sorry for yet another repost.
I had a Sheep account hacked due to a bad link from the Hidden Wiki (I should have known better, and I usually do). I only had about .002 BTC in there, but the admin was useless, so I never went back.
Having to be responsible for the security of your own bitcoins is a feature, not a flaw.
Derp.
there is no central issuer
Oh, talk dirty to me baby. Say it again.
there is no central issuer
Ahhhhhhhhhhh....
If a large dutch bank will go bust the deposit guarantee mechanism will also fail because the losses will be to large to divive over the few banks left.
actually if you traduce the Dutch Bank's words from national banker lingo to plain English, it's quite a positive message that it's giving
of course it's a consumer warning - after all it's Europe, where citizens expect and demand a certain degree of protection from the state - yet it says it will not monitor, not care and above all not intervene
that the DNB felt it was necessary to make a statement even though as member of the eurozone's ECB it could have refrained from doing so has also it's roots in the Iceland banking drama. there a lot of Dutch were reimboursed for losses, even though legally the Dutch State could have washed it's hands
this time, it makes a disclaimer beforehand
in short: "take care, you are on your own... and good luck"
Central Banks calling the kettle black. Those who profit on others labours.
Bitcoin, may remove their Gravy Train.
{The exchange rate is volatile and there is no central issuer which may be held liable.
If the Central Banks, Fed were held liable, the next step would be sueing them, some how I think they are above Commoners laws.}
LOL. Bitcoin has NONE of the problems the central banks mention.
Their only problem is it's not centralized.
Bitcoin's REAL problem is it's a grid currency. No grid, NO CURRENCY and you BETTER be ready for that outcome.
"The exchange rate is volatile and there is no central issuer which may be held liable."
Riiiiight, because that happens otherwise, right? Right?
L oh L.