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Re: [2014-08-12] U.S. watchdog calls bitcoin 'Wild West' of finance
Wow! We've come a long way. They got maybe 80% of their facts right, which is a big improvement over government agencies a year ago. Yeah, the tone was negative, but that's the job of that government group. The only investments they won't criticize are dollars and US Treasuries.
Re: [2014-08-07] Bitcoin Foundation Seeks to Extend Comment Period for New York’s Bi
The Bitcoin Foundation is wrong. Yes, they didn't get everything they want, but NY met more than halfway on compromising between regulation and freedom for cryptocurrency. The proposed regulations wouldn't affect the average bitcoin user or retailer at all. It wouldn't cause a fork in the chain either. It isn't going to get better than this, take the deal and move forward with expandinding bitcoin services in NY. Whining because you only got 90% and not 100% of what you wanted just looks childish.
200.3 c 2 is nice and clear:
(c) Exemption from licensing requirements. The following Persons are exempt from the licensing requirements otherwise applicable under this Part:
...
(2) merchants and consumers that utilize Virtual Currency solely for the purchase or sale of goods or services
(c) Exemption from licensing requirements. The following Persons are exempt from the licensing requirements otherwise applicable under this Part:
...
(2) merchants and consumers that utilize Virtual Currency solely for the purchase or sale of goods or services
Yeah, this is key. The regs overall basically formalize, into a Virtual-Currency specific charter, what is already required to comply with existing AML/KYC/BSA regs for money-transmitting/exchanging businesses. Thus, the uncertainty is removed, but nothing *really* changes; however, the explicit assurance that consumers and merchants are free to transact without regs is huge - that's really the only avenue a western gov would likely use to attack/constrain bitcoin, so the explicit carve-out is very nice.
That isn't exactly true. At the federal level FinCEN has provided guidance that the exchange of virtual currency constitutes money transmission under federal law and thus entities must register as a MSB with FinCEN. FinCEN's "guidance" is actually very poor and contradicts existing guidance (exchanging USD for EUR is not money transmission). It would have been preferable for FinCEN to do as NY has done and create a new regulated class (or expand "currency exchanger" to cover virtual currencies). They didn't and what is done is done. Still FinCEN's guidance doesn't apply to state regulations. They opened the box and created a huge amount of uncertainty.
No two states even share the same definition of "money transmission" or "money" at the state level and thus the applicability of existing money transmitter regulations on entities that exchange virtual currency for real currency is a huge legal gray area. Only a few states have provided any public information on the applicability of existing regulations. In some states existing regs could apply although that probably won't be certain until after some court decisions. In other states due to the wording it is highly unlikely that the existing regulations could cover virtual currency exchangers without a modification of the statute. This is going to take years if not decades to play out.
Agreed that a federal framework which supercedes states regs would've been preferable....but as you note, that ship sailed already.
On another note, Reddit seems very upset with these regs: http://www.reddit.com/r/Bitcoin/comments/2aycxs/hi_this_is_ben_lawsky_at_nydfs_here_are_the/
A couple valid points made (I'll have to read the regs closer to verify) are:
1) Entities like changetip would fall under this licensing
2) Companies must hold profits and retained earnings in dollars, not bitcoin.
3) Alt-coin exchanges fall under the regs.
I hope the above, plus the bonding issue, are addressed/contested strongly during the 45-day comment period. Also, one thing that would've been nice to see, and which can maybe be addressed in the comments period, is a scaling-up of regulatory burden with increase in business activity (ie, Fred Wilson's "on ramp" suggestion during the hearings in Feb) instead of the regs fully applying to all from day 1.
The folks over at Reddit would be complaining with any kind of regulation that even mentions bitcoin. This is a pretty reasonable compromise. Basically it just applies existing KYC/AML rules to bitcoin companies that are exchanging currency. The fact that it doesn't apply onerous regulations to the average person buying something with bitcoins, or the average company accepting bitcoins in exchange for goods is huge. It sets a good precedent that won't hamper bitcoins growth.
To the points above on Reddit:
1. Changetip is a redundant layer to Bitcoin anyways. The bitcoin protocal already allows microtransactions.
2. The section in question effectively says that these companies (MSBs) can't reinvest profits in other ventures. That's fantastic. If the owners of those companies (Bitpay, Coinbase, etc) want to invest in another business, they can take their profits in bitcoin and start another business. It's reducing the risk that deposits are inadvertedly lost through poor investing. I definitely support that.
3. Why should alt-coins be any different? There's risk on those exchanges also, makes sense that they adhere to the same rules. I'm sure there will always be plenty off-shore crypto-only exchanges to go to anyways.
Re: [2014-07-15] Coindesk : ING: Future Bitcoin Protocol Should Include Central Bank
I don't think everyone understands that this guy is talking about an algorithm (something that would be a part of the code) and not an actual central bank. I think it would be great to have an algorithm that could dynamically adjust coin generation based on the global supply and demand of the coin, which would damper price flucuations. But the issue to do it in a way that was clear and transparant, and couldn't be manipulated by miners, whales, exchanges, etc. It might not be possible because there's no obvious way to sample the supply and demand of bitcoin since that happens outside of the code, in exchanges or private transactions.
On that same note, bitcoin would be just as useful even if it didn't have a 21M cap or halving every 4 years. The key isn't the total fixed supply, it's the predictability of the generation. It's factored into the determination of price, which is why the first bitcoin halving didn't have a significant effect on the price (Other than assuring the market that the network wouldn't break, lol). Bitcoin could have kept generating 50 coins/10 minutes forever, and bitcoin wouldn't lose any real capability. And prices would have still risen because the demand has far outpaced coin generation.
On that same note, bitcoin would be just as useful even if it didn't have a 21M cap or halving every 4 years. The key isn't the total fixed supply, it's the predictability of the generation. It's factored into the determination of price, which is why the first bitcoin halving didn't have a significant effect on the price (Other than assuring the market that the network wouldn't break, lol). Bitcoin could have kept generating 50 coins/10 minutes forever, and bitcoin wouldn't lose any real capability. And prices would have still risen because the demand has far outpaced coin generation.
Re: [2014-5-25]Report Suggests MtGox Fraud Led to $1200 Bitcoin Price
This is not news to everyone who has been following the BTC market since 2011. MtGox has been the primary cause for all price swings in the market during that time. Whether or not is was hackers, inside manipulation, or incompetence is up for debate, but that's definitely been the case. Since they've declared bankrupcy, the volatility has gone down a lot.
Re: [2014-05-07] FxM: Cory Vines, the Warby Parker of Activewear, Now Accepting BTC
http://www.forexminute.com/bitcoin/cory-vines-the-warby-parker-of-activewear-now-accepting-bitcoin-31327
Quote
Bitcoin is everywhere now and the latest name that has started accepting them is Cory Vines, the Warby Parker of Activewear. In its announcement, the company said that it was a logical step to accept the innovative payment method. Daniel Lieberman, founder of Montreal-based Cory Vines admitted that his organization positioned itself as a technology-enabled brand, and wants to stay ahead of the curve.
I love how many small to mid size companies are starting to accept Bitcoin mostly because they expect other companies to do it in the future. It's a self fulfulling prophesy, lol.
Re: [2014-05-07] Brickchain: A Store for Cryptocurrency-savvy LEGO Fans
Hmm.. not sure how much demand there will be for people to spend their coins on Lego, but it's always nice to see more merchants, and especially stores that accept only cryptocurrencies.
And is that Dorian's face on the little lego man?
And is that Dorian's face on the little lego man?
Yep, it's lego-Dorian
I really wish Dorian would capitalize on his quasi-fame and sell his likeness for Bitcoin related items. It would be pretty low effort on his part, and help him financially. Plus, I can't think of a better face for Bitcoin than a somewhat bitter, intoverted, older Japanese man that loves trains. I'd buy a t-shirt or two.
Re: Don't keep your Bitcoin on an exchange - Help squeeze the shorts
Unless they are needed for an active order, I recommend keeping them in a safe wallet. Cold storage or Bitgo would be best.
Two good reasons:
1) They won't be stolen if you keep your private keys safe and unused.
2) Your BTC can be lent to others who sell them short. By keeping them on the exchange, you allow them to be sold short, possibly repeatedly. This will depress the price, hurting your investment. Get the coins off the exchange and they won't be used by the bears to drive price down. Get enough off the exchange and you will help squeeze the shorts, forcing them to buy.
Two good reasons:
1) They won't be stolen if you keep your private keys safe and unused.
2) Your BTC can be lent to others who sell them short. By keeping them on the exchange, you allow them to be sold short, possibly repeatedly. This will depress the price, hurting your investment. Get the coins off the exchange and they won't be used by the bears to drive price down. Get enough off the exchange and you will help squeeze the shorts, forcing them to buy.
They will also be bought back repeatedly, driving the price up. Shorting just moves the market more rapidly in the direction it's heading anyways, and adds volatility. When prices are rising because demand outweighs supply, the shorters get busted, and it doesn't matter how many coins are on the exchange because no one wants to borrow them.
Re: [2014-05-05] Polygon: Why Eve Online's economist thinks bitcoin could be a scam
He does not have to understand the code, he could download the paper and study it... at least, you'd expect a Dr would do some research before talking.
He could download the code, examine it himself, compile and verify the hash. I realize that examining the code line-by-line isn't trivial, but it's been open source from the start and no one has found a hidden function like DO "On May 5, 2014, Satoshi gets all the bitcoins." Lol
Re: [2014-05-03] Overstock Holds onto 10% of All Earned Bitcoins
Smart move. Give em 2 years and they'll leave Amazon in the dust.
Amazon really is THE giant of our times... even with bad quarterly results the wallstreet still loves them... they are here to stay for a long long time..
Wall Street keeps pumping the cash into Amazon, so they can afford to push out competitors by offering lower prices, even at a loss. I always check Overstock before buying something at Amazon, but most of the time they don't even have the same thing in stock. And if they do, the price isn't even close to what Amazon is charging. I'm sure Overstock beats Amazon in some categories, I just haven't figured out what they are yet. :-/
Almost every single bitcoin bubble and crash since inception has been because of some kind of screw-up or intentional manipulation at Mt. Gox. Even the 2013 run-up from Chinese adoption wouldn't have gone so high if it weren't for Mt. Gox stopping fiat transfers. Even now, the potential for 200K (or more) coins to come out of Mt. Gox wallets still hangs over the market.
So, seems being bearish pays off. Where are the people screaming 'to da moon' 1 week ago? I hope they didn't trust too much money (again) by panic-buying. I won't make any prediction but I think we can see last 12-month low soon.
Also I'm starting to be very very suspicios of BTC being able to go beyond 700 this year.
And the key as within everyone: don't freaking sell unless you need money for the things at the base of Maslow's pyramid. Do that, and we'll have a supply shortage getting us to everywhere you want.
Hell, with only 10mil coins or so in circulation (very optimistic assumption), a guy with one coin has a fair share of power.
Also I'm starting to be very very suspicios of BTC being able to go beyond 700 this year.
And the key as within everyone: don't freaking sell unless you need money for the things at the base of Maslow's pyramid. Do that, and we'll have a supply shortage getting us to everywhere you want.
Hell, with only 10mil coins or so in circulation (very optimistic assumption), a guy with one coin has a fair share of power.
The folks who need money to buy things at the base of Maslow's pyramid aren't likely to be the ones with enough firepower move the price. Selling 1 or 2 coin each month to pay for food and rent is nothing compared to fat cats who are regularly dumping hundreds or thousands of coins.
So, Russia and/or China want to build a version Eastern version of SWIFT? That's, it'll disrupt the global money transfer market, and further highlight the advantages of using a new technology like bitcoin.
Re: NEWS!!CHINA WILL NOT BAN BTC Damn u fonzie,cosmofly,GTO and the rest of fudsters
Central Bank: "You can have a much Bitcoin as you want. Bitcoin is good. We have lots of Bitcoin too. You just can't use yuan to buy bitcoin or trade it on markets unless you have special permissions."
Re: [2014-04-11] WSJ: Investor Group Seeks Court OK to Buy, Revive Bankrupt Bitcoin
I don't even think MtGox is worth the 20% payout to creditors. I don't think they own any real estate or physical assets other than a few servers. The coding for the exchange is crap compared to other established exchanges. The banking relationships are suck, and MtGox didn't have anyway to send out USD deposits. And the reputation of the exchange couldn't get any worse unless it was revealed they also ran a dog fighting league. The only possible asset of MtGox is the contact information of all previous customers. That might be worth a few hundred thousand, or maybe even a million, but I can't imagine many investors wanting to pay more than that.
Re: [2014-04-10] CoinDesk: Lawyers Want Bitcoin Money Laundering Charges Dropped
Not gonna work. They took in dirty money and exchanged it for something clean (bitcoin), which could later be exchanged for clean money. That sounds a lot like money laundering to me. Folks on localbitcoins really ought to register as a money service and CYA as much as possible. They probably could have avoided it if they did something as simple as implementing a half-ass KYC/AML policy. I hope that sellers on localbitcoins that knowingly deal with criminals and dirty money are the exception, not the norm.
What is HODL?
Pretty sure it's a retarded meme born from: https://bitcointalk.org/index.php?topic=375643.0You dare mock the official meme of the Bitcoin speculation forum?
Re: [2014-04-02]Ross Ulbricht Lawyer Wants Case Dismissed, ‘Bitcoin is Not Currency’
From what I understand, for it to be money laundering, you must be laundering money. But, according to the IRS, bitcoin is not money, therefore if cannot be laundered. The only folks that could be clearly accused of money laundering in the Silk Road case would be currency exchanges if they knowingly traded fiat for bitcoins with folks who were buying or selling illegal drugs.
I'm assume that there is a difference in the legal definitions of "money" and "currency", and IRS regulations apply to taxes and not necessarily to areas of the law. Anyway, your proposed defense was already shot down in the Trendon Shavers ponzi scheme trial.
That's true, the IRS has it's own definitions, regardless of the law. I was under the impression that Trendon Shavers was using that defense to avoid the charge of security fraud. I don't know if he was found guilty of money laundering or not. However, in his case, there was a lot of transactions between USD and bitcoin in order to hide what he was doing.
Re: [2014-04-02]Ross Ulbricht Lawyer Wants Case Dismissed, ‘Bitcoin is Not Currency’
Not really. You can launder money through potatoes if you wanted. That's not gonna stop them prosecuting you.
It could stop them from prosecuting you for money laundering. From the Cornell Law site:
"Money laundering refers to a financial transaction scheme that aims to conceal the identity, source, and destination of illicitly-obtained money."
That would be a tough argument to make, in a fair court at least, lol. There's certainly enough drug charges to send him to jail though, lol.
Tax evasion could still be brought up also.
Yes, but wasn't he laundering the Bitcoins for cash? I don't image he's been surviving all this time exclusively on Bitcoins.
From what I understand, for it to be money laundering, you must be laundering money. But, according to the IRS, bitcoin is not money, therefore if cannot be laundered. The only folks that could be clearly accused of money laundering in the Silk Road case would be currency exchanges if they knowingly traded fiat for bitcoins with folks who were buying or selling illegal drugs.