Bitcoin Jumps To New Record High As Governments, Regulators, Bankers Panic

Tyler Durden's picture

Another dip to be bought as the weekend's pump'n'dump in Bitcoin has led to yet another new record high this morning at $11,850.

Bitcoin's market cap is now $200 billion...

This resurgence comes after a week of considerably more active propagandizing from the establishment.

As we noted previously, this week has seen a new group of establishmentarians jump on to the offensive against anti-decentralization, de-control, pro-freedom cryptocurrencies - urging bans, crackdowns, fatwas, taxation, creating their own cryptocurrencies, demanding citizens sell, and outright confiscation (this group includes governments world wide and their mainstream media mouthpieces)...


India's finance minister, Arun Jaitley, has clarified that the government does not recognize bitcoin as legal tender. According to the Economic Times, when asked about the government's plans to regulate the cryptocurrency, Jaitley told reporters, "recommendations are being worked at." He continued:

"The government's position is clear, we don't recognize this as legal currency as of now."

Concerned over bitcoin's anonymity and its potential illicit uses, justices issued a notice to the central bank and other agencies asking them to answer a petition on the matter, reports indicated.


Turkey has claimed Bitcoin is in fact “not compatible” with Islam due to its government being unable to control it.

In a statement from a meeting of the state Directorate of Religious Affairs (Diyanet), lawmakers said that Bitcoin’s “speculative” nature meant that buying and selling it was inappropriate for Muslims.

“Buying and selling virtual currencies is not compatible with religion at this time because of the fact that their valuation is open to speculation. They can be easily used in illegal activities like money laundering, and they are not under the state’s audit and surveillance,” Euronewstranslates the statement republished by local news outlet Enson Haber.

Diyanet added that the same principles of “unsuitability” in particular applied to Ethereum.

South Korea

Kim Dong-yeon, South Korea’s deputy prime minister and the minister of strategy and finance, revealed earlier this week that the government is investigating various methods to better regulate the local Bitcoin market and tax Bitcoin users accordingly.

While the South Korean government and its local financial authorities are actively discussing the possibility of enforcing a policy on Bitcoin taxation, at a press conference, Deputy Prime Minister Kim stated that the government does not intend to include any Bitcoin taxation policy in 2018’s amendment of the tax law.


A Dutch news paper urges its citizens to sell their bitcoins patriotically because cryptocurrencies can undermine government and destabilize the economy.

A bitcoin world can destabilize the real economy, a euro is also solidified trust.

First, the bitcoin undermines the government because a lot of transactions are about money laundering and tax avoidance. Another problem is that the profits of new bitcoins that come with it do not benefit the government (as with normal money creation), but are absorbed in heavily environmentally harmful computer power.

Central banks also have less influence on keeping the economy stable. In times of crisis, central banks can, through their influence on ordinary banks, ease credit conditions and encourage people to consume. The bank has no control over the bitcoin economy and an economic crisis can become deeper.

The investor has air in his hands when the bitcoin crashes, but also when the company turns out to produce baked air.


Putting money in an empty type of asset is “very, very worrying,” Robert Ophele, chairman of France’s market regulator. Bitcoin has no link to the real economy, Ophele says in a panel discussion at the Paris Europlace Financial Forum, warning that cryptocurrencies are a way to commit cybercrimes, allowing access to illicit goods and services.

If bitcoin was a currency, "it would be a bad one," Ophel exclaimed, as it poses major challenge for central banks and regulators.


The Telegraph reported just around the time of the big drop, UK "ministers are launching a crackdown on the virtual currency Bitcoin amid growing concern it is being used to launder money and dodge tax."

Taking a page out of the Chinese playbook, the UK Treasury has announced plans to regulate the Bitcoin that will force traders in so-called crypto-currencies to disclose their identities and report suspicious activity. 

According to the Telegraph, while "until now, anybody buying and selling Bitcoins and other  digital currencies have been able to do so anonymously, making it attractive to criminals and tax avoiders. But the Treasury has now said it intends to begin regulating the virtual currency, which has a total value of £145 billion, to bring it in line with rules on anti-money laundering and counter-terrorism financial legislation."

John Mann, a member of the Treasury select committee, said he expected to hold an inquiry into the need for better regulation of Bitcoin and other alternative currencies in the new year.


He said: "These new forms of exchange are expanding rapidly and we've got to make sure we don't get left behind - that's particularly important in terms of money-laundering, terrorism or pure theft.


"I'm not convinced that the regulatory authorities are keeping up to speed. I would be surprised if the committee doesn't have an inquiry next year. "It would be timely to have a proper look at what this means. It may be that we want speed up our use of these kinds of thing in this country, but that makes it all the more important that we don't have a regulatory lag."

The proposed changes come amid increasing fears that Bitcoin is being used by gangs to launder the proceeds of crime while also attracting currency speculators - with the value of the coin soaring in the past 12 months.

In other words, the same reason why the IRS is cracking down on Coinbase clients in the US is also why UK and European regulators are joining China in cracking down on capital flight.

United States

The US Senate Judiciary Committee is currently tackling bill S.1241 that aims to criminalize the intentional concealment of ownership or control of a financial account. The bill also would amend the definition of ‘financial account’ and ‘financial institution’ to include digital currencies and digital exchanges, respectively. According to ranking committee member Senator Dianne Feinstein, the proposed bill is needed to modernize existing AML laws.

The bill would amend the definition of ‘financial institution,’ in Section 53412(a) of title 31, United States Code, to include:

“An issuer, redeemer, or cashier of prepaid access devices, digital currency, or any digital exchanger or tumbler of digital currency.”

If passed, the bill would likely have far-reaching effects for users of digital currencies both in the US and abroad.

Earlier reports also indicate that the White House is actively monitoring cryptocurrencies which could only mean more attempts to regulate the world’s first successful decentralized monetary system. With the growing involvement of Wall Street and the ever escalating media attention, it is not surprising that governments are stepping up their attempts to regulate digital currency.

image courtesy of CoinTelegraph

Simply put, Bitcoin must be providing something of value to the 'people' if all these establishmentarian status-quo-defenders are panicking.

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Haus-Targaryen's picture

I'm a butthurt nocoin goldbug -- but I see BTC rallying and I can do nothing but cheer it on.  Anything to burn the powers that be I am completely fine with.  

I always thought it would be AG and AU getting away from them; looks like BTC is the Hydra that will burn this thing down.  

Burn it down, burn the entire thing down. 

tmosley's picture

IOTA outperforming bigly.

Chuck Norris's picture

If they are panicking about bitcoin at these prices how much will they shit their pants when gold hits $10k?

Arturo's picture

Bitcoin is MySpace. IOTA is Facebook.

dasein211's picture

Which exchanges support iota. Stupid poloniex doesn’t.

Ghost of PartysOver's picture

And who did not recognize the fact the governments around the world can destroy any and all crypto's.  He who controls the internet controls the crypto's as well as he who controls the regulations control the crypto's.  The time has not yet come for the crypto's.  Maybe one day. 

Thom Paine's picture

He who controls, IRS, regulations and laws controls domestic owned cryptos.

Unless you intend to never use it, never transact anything in it you will be caught up in the system - unless like prison, fines.

Citxmech's picture

Who is actually buying BTC at $11k+?  


IH8OBAMA's picture

Panic?  We are getting close to seeing what real panic is.  Fasten your seat-belts, coiners.


tmosley's picture

Luckily, there is no such thing as "domestic owned crypto". They exist on the internet, which is everywhere.

Citxmech's picture

Just a question:  Can internet providers "filter" data streams to, say, selectivly prevent blockchain data from being transmitted/verified while letting everything else through?

tmosley's picture

They could try, but they would have to block encrypted data streams too, and that would fuck up a LOT of services and piss people off to no end (no more online banking, etc).

Citxmech's picture

Thanks for the response T!

Ghost of Porky's picture

Meanwhile, Fonestar just bought Lake Michigan.

tmosley's picture

An analyisis of Bittrex code has made some suspect that they will be adding it soon as well.

Once it gets added to fiat gateway exchanges, watch out!

The_merovingian's picture

IOTA has been the subject of much hype but I believe some scepticism is warranted. The last time I checked it was still using a central coordinator server because their revolutionary tech was not quite ready for primetime. The attitude and basic cryptographic credentials of the development team also raise questions for me. They invented their own hash function (Curl) which cryptographers quickly discovered had serious collision problems. The developers then claimed they had deliberately designed a defective hash function - on purpose - as a copy protection measure. They then did not replace it with a standard, well analysed, hash function but once again decided they knew better than the entire academic cryptographic community and created their own. IOTA also uses ternary arithmetic rather than binary, making it very inefficient on actually existing computers for no practical benefit.

tmosley's picture

This is a very good run down on the bear case for IOTA.

Laowei Gweilo's picture

bear case for IOTA ever being broadly adapted. maybe bull cash for IOTA having some of the most practical application between decentralized partners tho.

of all the B.S. ICOs (cryptos for car industry; etc), IOTA is founded on some pretty good concepts ASSUMING you have agreed upon decentralized partners. it'll never work fully decentralized any uncertain/unspecific set of partners, but for partners that want to use it for financial purposes between one another it has some cool practical application. for me, IOTA for me is similar to Ethereum and Ripple in that I think they have some of the best practical application for different purposes, and the speculation actually hurts them. the sooner their prices stabilize the better the sooner they can reliably serve a financial (networking) purpose. imo =p

yardsale's picture

Binance. xfer BTC, LTC, etc.  Works pretty good and similar to some of the decentralized exchanges like Bitshares.

kochevnik's picture

IOTA not using blockchain, so software issues invoved interfacing to the tangle

MonetaryApostate's picture

Since 2009 alone the ultra wealthy running America have printed over $551 Trillion dollars, & can loan out 90x that!

It's all fake, everything.

Bring the Gold's picture

You appear to make assumptions about the amount of bills printed based on the maximum possible. Do you have any actual data to back up your amazing statement that banks created hyperinflation amounts of physical currency? I could see them doing this when they are ready to tank the dollar, but not before.

hal0bender's picture

Same bullshit was said about ETH.  So far IOTA is nothing more than vaporware.  Another Golem or Siacoin that in reality performs like crap.

joak's picture

Yesterday and this morning I have seen IOTA performing at +30 transactions per second (they are in beta). Now Ethereum is at 12 TPS, I won't even mention BTC to avoid any offense.

tmosley's picture

That is true, but remember they still use a coordinator. They are working on getting rid of that, though.

Bear case aside, I remain a bull. Whoever wins this crypto war is going to rule the world.

The_merovingian's picture

The partnership is the best thing that could have happened to IOTA. I love the concept but they really need some structure and more professionalism to make this work. I have no doubt that this was part of the deal going forward.

Mementoil's picture

Gold is the only thing that really scares governments.
Because they can't create their own version of gold out of thin air, the way you can do with crypto-currencies.
And because gold is already in the hands of the people, in the form of jewelry, gold watches etc.

3LockBox's picture

Bankers worried?

Isn't having a bank account a prerequisite to setting up an account?

dasein211's picture

No. You can have your own cold storage wallet. Ledger x. Ledger nana. Breadwallet. Shapeshift. Trezor wallet. And use localbitcoins to purchase around banks noses.

kochevnik's picture

In USA FBI agents posing as vendors on localbitcoins.  Maybe they sell coins they stole

DjangoCat's picture

Prohibition did not work.  They cannot stop mass movement.

Winston Churchill's picture

When they hit the exchanges with drone strikes will be the signal of panic.

But as Squawker has proven,they already own them,so no need at all.

Remember those Cypriot banks ?

The connected are being allowed to get out, same as it ever was.


DjangoCat's picture

In case you forgot, gold was confiscated from the Amercan people some years ago.  The US public holds very little gold and has been discouraged from buying it while the CBs in Asia load up at discount prices.

I would be willing to place a small wager on the meme that the USG has been robbed of all its gold by the likes of the Bush family.

Mustahattu's picture

Gold is manipulated. It won't go to $10k anytime soon.

DjangoCat's picture

Break the control with Bitcoin and gold will be free.

HRClinton's picture

Chuck, I'm doing more than my part to drive AU to $10k.

I'm a HODLer, trading BTC for AU.

Smart dealers see CCs as a way to finally get out of the yoke of PM Oppression by banks and China.

shamus001's picture

All thus talk about money launderig and criminal use! What do they propise as a solution? BAN CASH and use ONLY GOV DIGITAL CURRENCY?

FU! Banks are and ALWAYS HAVE been the ones laundering money through their digital and fiat system! You and your lobbied GOV are the real criminals pushing drugs and doing crime on a global scale.

CONSTITUTIONAL MONEY = Silver. REAL silver, coin...untraceable, free commerce, and whike were at it, Federal Taxation is Illegal, and criminal! So you dont need to worry about taxation dodging, because you do not need a single $! States to donate a small % of staye tax to provide a DEFENSIVE military ONLY.

Laowei Gweilo's picture

I doubt they care about the price per se... Bitcoin price is arbitrary in the sense that, it's created from nothing and it's essentially just 1 person giving another person their FIAT. it still ultimately relies on a zero sum winner and loser of FIAT. no matter if the last trade was $12 or $12,000, it's still a zero sum game because someone basically just gave their USD to someone else. 

reason they care is they want their cut of the transactions, not the actual 'value' per se.

dasein211's picture

So buying gold with fiat is also a zero sum game? Because what is gold priced in as fiat becomes shit?

Killtruck's picture

Pussy. Same as it has always been. 

Laowei Gweilo's picture

sure, but then you have some shiny metals that look cool around your neck lol =p

same with BTC, you're left with nothing but maybe you just transfered your money out of nigeria or away from the IRS

/views =p

kochevnik's picture

IOTA has free transactions.  Remainder of your post simply proves you illiteracy

Spaced Out's picture

Only an idiot would gloat that 100% of $3 equates to "outperforming" 1.5% of $11,799.

Your ignorance is encyclopedic!

tmosley's picture

>Nominal gains are more important than market cap gains

The retardation is real.

Spaced Out's picture

I prefer capital gains over perceived percentage increases.


"Steptoe & Johnson is the company tasked with tracking down anyone perceived to have libeled the Hong Kong-based exchange".

I think you might need those profits :D