Department Of Defense To Study Bitcoin As A "Terrorist Threat"

Tyler Durden's picture

Submitted by Mike Krieger of Liberty Blitzkrieg blog,

Two very interesting Bitcoin related articles have emerged over the past week and demonstrate the total irrationality that surrounds the status quo’s understanding of this revolutionary and liberating technology. Let’s start with the Department of Defense story, the headlines of which most of you have probably seen by now.

A division of the U.S. military known as the Combating Terrorism Technical Support Office (CTTSO), which studies threats to national security (i.e., the status quo’s grip on power) has listed Bitcoin amongst a number of potential terrorist threats. Of course, as I and many others have noted repeatedly, anything which threatens the prevailing criminal status quo will be merely labeled a “terrorist threat” in order to neutralize it. Just in case you aren’t yet convinced of how insane the folks at CTTSO are, “also on the CTTSO’s list of terrorism research topics were Android, Motorola, social media and virtual reality.” What has happened to this country…

From International Business Times:

After attracting attention from law enforcement, financial regulators and old-school Wall Street investors, bitcoin is now on the U.S. military’s radar as a possible terrorist threat.

 

Friday was the deadline for submissions to a counterterrorism program seeking vendors to help the military understand state-of-the-art technologies that may pose threats to national security, and “bitcoin” and “virtual currencies” are listed among them.

 

The program is being conducted by the Combating Terrorism Technical Support Office, a division of the Department of Defense that identifies and develops counterterrorism abilities and investigates irregular warfare and evolving threats.

 

An unclassified memo from January unearthed by Bitcoin Magazine detailed solicitations for CTTSO projects. The memo states that one of the mission requirements is for “innovative…solutions to develop and/or enhance new concepts and constructs for understanding the role of virtual currencies” in financing threats against the United States.

 

A Treasury Department investigation said in March that it found no evidence of “widespread” use of virtual currencies like bitcoin to finance terrorism. Still, it’s clear that nefarious individuals have recognized the potential to use bitcoin for harm.

Ok so they have no proof whatsoever that Bitcoin has anything to do with terrorism, but what the hell let’s just demonize it anyway! I’m just waiting for the witch burning ceremonies to commence on the National Mall.

Also on the CTTSO’s list of terrorism research topics were Android, Motorola, social media and virtual reality.

There you have it. Peer-to-peer technology=terrorism.

Moving along, Bloomberg published an article this morning talking about how Wall Street won’t use Bitcoin, but will try to rip off the technology. This shouldn’t surprise anyone, as the only advancement we have seen in the financial services industry in decades is an explosion in creative ways to commit fraud and not get in trouble for it. After all, when you are an industry with zero creative talent what are you supposed to do. You lie, steal, cheat and pay off politicians in Washington D.C..

From Bloomberg:

While Jamie Dimon and Warren Buffett express doubts about bitcoin, executives running the financial industry’s back offices are looking at mimicking the virtual currency’s methods of moving money quickly and cheaply.

Zero. Talent.

FIS, a provider of systems used by banks to handle payments, is examining whether a public ledger like bitcoin’s could help securely move funds on existing networks, Fred Brothers, the firm’s chief innovation officer, said in an interview. Fiserv Inc., a provider of technology for payments and accounts, is examining bitcoin’s use of encryption to ensure transfers are secure, said Marc West, a senior vice president.

 

Such interest shows how Wall Street could seek to reap benefits touted by bitcoin’s backers without using the virtual currency itself. Bitcoin, proposed by an anonymous programmer or programmers in 2008, has drawn entrepreneurs and retailers looking to popularize it as a low-cost alternative to established payment systems, supplanting credit cards to international wire transfers. Instead, a variety of financial firms might copy its underlying design to hone their own systems or services sold to clients.

Let me guess, once the big banks start using the technology it will suddenly cease to be a “terrorist threat” and will morph into a breakthrough banking technology.

“It’s safe to say that every bank is looking at what’s going on with bitcoin and those types of technologies,” said Steve Kenneally, a vice president at the American Bankers Association. “Most of the larger banks are investigating it. The larger the banks, the further along they are.”

 

Buffett’s long-time business partner, Charles Munger, was less charitable this week, telling Fox Business Network that calling bitcoins “rat poison” would understate his disdain.

Oh boy, more on this later…

Wedbush is examining the potential use of systems akin to bitcoin for interbank money transfers, said Luria, who oversees the effort. Such technologies include Ripple, a bitcoin-like system that completes transactions faster.

I wrote a detailed post describing Ripple, the pros and the cons earlier this year. In case you missed it: What is Payment Protocol “Ripple” and How Does it Allow for Physically Backed Digital Gold Currency Exchange.

“What banks are looking at is updating the technology they already have — using the rails that they have in a more efficient, faster manner through modifying existing payment systems,” Whaley said.

How can the financial services industry be seen as anything more than extremely well paid parasites.

Now let’s get back to those Charlie Munger comments. For those of you unaware, Munger is Warren Buffett’s right hand man, and he made headlines in 2012 when he stated only Jews in Nazi Germany before being thrown on a train to a concentration camp have any reason to buy gold. I’m starting to think that Munger is actually Uncle Warren’s evil alter-ego. That Munger spews what Buffett actually thinks but can’t say himself since he needs to keep his cutesy grandfather routine going.

In any event, Munger called Bitcoin “rat poison” (watch the interview here) and I found his choice of words quite telling. After all, rat poison is used to eliminate dangerous and unsanitary pests, namely rodents. So if Bitcoin is “rat poison,” who are the rats? I’d say the financial system itself. So if Bitcoin is the poison to eliminate the hopelessly corrupt and parasitic financial system I have to agree with Munger. Bitcoin is indeed rat poison.

I also find it interesting how Munger seems so obsessed with the word “rat.” Recall, he recently described slammed HFT as “rats in a granary.” Lots of rat imagery happening in this creepy old man’s mind. You have to wonder why…

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McMolotov's picture

I look forward to seeing videos of Fonestar wearing a fake beard.

resurger's picture

You kids will hate you for not buying! LAwl

fonestar's picture

FUCK YEAH BITCOIN!!!!

 

                                                        WOOH!

 

  OOH! 

                                                       OOH!

 

                                                 WOOOOOOOOOOOAH!!!!!!!!!!!!

Keyser's picture

The DoD should investigate itself as a terrorist threat...

 

G.O.O.D's picture

I guess I'll see you dancing in the ruins tonight? http://www.youtube.com/watch?v=wlVWprYozR8

fonestar's picture

WW3 is an especially bullish possible scenario for Bitcoin as it facilitates direct transfer right through economic restrictions.  fonestar can always send BTC to users in Russia and China.  The networkers always find a way to route around anything.

knukles's picture

So far they've not explained life or consciousness either.

PS  Androids are dangerous. Just as Arnold Schwarzenegger

chumbawamba's picture

I propose a neologism for "munger".  In the same vein as "santorum" (you know what I'm talking about) and the whole Richard Gere gerbil stuffing meme, I would like to put into the vernacular:

mun·ger

munj?r 

 

verb    to stuff a rat into a partner's rectum as a form of sexual gratification. 

 

"After a few lines of crystal and some indeterminate amount of vodka I agreed to let Cody munger me this past weekend."

I am Chumbawamba.

chumbawamba's picture

You must be an aging fuck like me, knukles.  I realized only after hitting the "save" button that a lot of the kids around here probably don't even know about the whole Richard Gere gerbil stuffing thing, let alone who Richard Gere is.

-Chumblez.

espirit's picture

I always thought Federal Reserve Notes were number one choice of terrists.  BTC?  Rubles, or Yuan seems moar likely.

Bet we need moar .gov to opine this. 

Prisoners_dilemna's picture

"You can assume no government wants you adopting this system in any capacity, and for that reason alone it's worth consideration by honest, moral, and industrious people."

 

http://evoorhees.blogspot.com/2012/04/bitcoin-libertarian-introduction.h...

 

I dont know anything about this Gere incident.   My generation is familiar with "The Sparrow Prince", "The Frog King", "Catatafish", and "Mr. Slave".

gold-is-not-dead's picture

Mr Munger doesn't look happy. Did someone put a dick in his eye? Money can't buy another one.

Jreb's picture

Fuck - I laughed hysterically at that. I'm getting old....

prains's picture

poor fucking rat, it does not deserve such a fate....my vote is to replace the rat with Bernank. So instead of stuffing his rectum with an innocent creature whose only crime was to fail in the genetic lottery of biology, the Munger would include Bernanks head being stuffed instead.

 

I am Haka or prains or hey you! depending on how much money my kids sense I have at the time in my wallet

sleigher's picture

You must visit the hole in the wall bar south of market SF.  I insist.  

$5 for a line and a budweiser.  Years ago anyways.  I moved away 3 years ago or so. Jack knows the spot.  Wonder if he still works for yellow... 

chumbawamba's picture

Nice, you're a domestic terrorist now!  Welcome to the club, brother.

I am Chumbawamba.

mkkby's picture

"Could be used by a terrrorist", not "is a terrorist threat". 

Duh.  Krieger is an ass.  Nothing to see here.

TheReplacement's picture

If there really is to be a WWIII btc will die or do you really think countries will leave the internet up so that they are connected, just to make it easier for spies and such. 

We aren't talking about some rainblow revolution in where Sheik Yerbooti is gently escorted out of office.  A real WW and the world we know stops existing.

XitSam's picture

What are you buying from Russia and China? How do they deliver it?

HardAssets's picture

WW3 bullish for bitcoin ?

Ever heard of EMP ?

At least with PMs, you don't need computers or even electricity

I don't think the WW3 scenario is a bitcoin selling point.

gold-is-not-dead's picture

good luck with hidding 10 kg of gold...

Parrotile's picture

Seeng as a single Fed. Reserve gold bar weighs in at 14kg or so, and is only approx 7 x 3 1/2 x 1 3/4 inches, 10kg gold wouldn't be that difficult to hide, especially if it were to be subdivided into, say, 2kg ingots.

HardAssets's picture

Another example of the military 'mind' ?

I swear, some in the military remind me of trained East German guard dogs. Enough 'brains' to do (with great effectiveness) as their masters order. But not enough brains to see that they're being ordered by psychopaths to attack old ladies, as they try to escape over the Berlin Wall.

Then again, maybe they just want to grab taxpayer dollars and keep some more job slots for themselves open.

fonestar's picture

Or US GIs kicking in doors of innocent Iraqis and executing women and children?

logicalman's picture

Shortest investigation in history!

Guilty!

RafterManFMJ's picture
Headline from 2015

 

 

Department Of Defense To Study Gold As A "Terrorist Threat"
Stuck on Zero's picture

This is the coolest.  A mathematical algorithm is now a potential terrorist threat.What's next, poetry?

 

asteroids's picture

What's the difference between bitcoin and the FEDs fiat? Not much really. They are both created with computers and no real physical work is done, ulike the mining of gold or silver.

fonestar's picture

No work done?  What a crock of shit, the Bitcoin network is the most powerful network on planet Earth.  It is LITERALLY doing more work than everything else.

Jendrzejczyk's picture

Could you get it to pull some freaking wires through a hotass attic for me tomorrow?

Thanks Fonebro.

Clever Name's picture

I have some mulch being delivered tomorrow also, chop chop!

XitSam's picture

Good god you're an idiot.  This "work" you speak of is actually the largest contributor to global warming, I mean climate change, I mean climate disruption.

KingFiat's picture

For the FED fiat I have to agree that no physical work is done. That is plain counterfeiting.

But for bitcoin a lot of work is being done by computers: To validate the blockchain (and create new bitcoin) a lot of computer power is used. Currently enough computer power to calculate more than 64,000,000,000,000,000 cryptographic hashes per second, or more than thousands of the world's fastest supercomputers can do.

Because anybody can mine bitcoin, simple economics apply: The profit after CapEx, electricty costs and cost of trading bitcoin to fiat to pay the bills is marginal.

The only real value of the mining for bitcoin is the validation of the blockchain (the public ledger of bitcoin movements). It is needed to avoid trusting any particular entity with this validation (as the trusted entity would become corrupted, just as the FED). Instead we trust that at least half the computing power of the mining network are honest. And fortunately bitcoin mining today requires expensive specialised hardware that is useless without bitcoin, so dishonest miners have to work to destroy their own investment in mining hardware.

logicalman's picture

Simple question....

Who has the most computer power?

Answer that and you know who will end up controlling BitCoin.

Don't get me wrong, the concept is awesome, I just don't trust the technology it relies on, with hardware and software open to manipulation as it is right now.

The government thugs are still in control. An important thing to remember.

 

Clever Name's picture

An even simpler question:

What is all that 'work' actually doing? "Mining" for BTC? Highly dubious.

chumbawamba's picture

Generating heat.

I am Chumabwamba.

jonytk's picture

mining is just a game of luck, like lottery, the more power, the more tickets you have to win the lottery.

If there were ever a way to cheat, a flaw on the mining algorith, it could be just upgraded to scrypt or other "mining" algorith.

The only side effect mine could have is the advent of cheap password decoding machines that could bruteforce short passwords based on SHA-256 or weaker.

Oh wait bitcoin could be the cause of websites and banks being robbed. ah the irony.

Bunga Bunga's picture

Who has the most computer power?

The Bitcoin network. All supercomputers in the world combined are a computational joke compared to the mining network.

Sure, the government could buy miners and kill it in a 51% attack.It would cost them today $858 mln, but doubling every few months. I doubt that the bureaucracy could ever win that race.

 

zerocash's picture

The FED can print USD faster than the Bitcoin difficulty increases.

jonytk's picture

most likely chinese chip manufacturers, that's why they drove the price up, to increase sales.

I predict chip manufacturers will fund, with bitcoins, the first fusion-reactor in 2050 to get cheap energy to... wait for it... mine more bitcoins.

asteroids's picture

Brute force search eh? Sounds kinda dumb. At least we use mechanical leverage and have a pretty good clue as to where gold and silver are when we dig. Don't get me wrong, I kinda like bitcoin. I'm still on the fence about it.

Bunga Bunga's picture

If you understand a little bit more of how semiconductors work, you will see that a lot of physical workout happens in the mining chips. 

doctor10's picture

So nobody will take Iranian or North Korean forged US 100's anymore?

Funny how Zero is Zeroing out EVERYTHING

The tighter his grip-the faster it slips through his hands

fonestar's picture

Fuck yourself. 

fonestar has never been so proud to identify himself as a monetary terrorist!

Keyser's picture

You wearing your Che Guevara t-shirt?